The mainstream media is about to declare Bitcoin dead for the umpteenth time, as the cryptocurrency market rapidly lost 18% of its value over a week. However, not only is this situation far from the end of all crypto, it can even be turned to your advantage. We will explain how, and give a list of cryptos to buy during the dip.
- Last weekend, the stock market plunge sent the cryptocurrency market down the drain and caused massive liquidations across the board. Top cryptocurrencies lost 10% to 20% of their value on average, and the total market cap shrunk by $700 billion;
- Some crypto platforms even managed to benefit from this event. For example, MakerDAO capitalized on ETH liquidations, while ATOM decoupled from the bearish trend altogether;
- While some see this as a setback, for others this is an opportunity to buy the dip. We highlight several cryptos to buy during the dip: BTC, ETH, FTM, ATOM and NEAR.
What happened in the last few days?
Late January proved bearish for the cryptocurrency market, when after the market correction this past weekend erased almost $700B of value from the total market cap. Bitcoin went down 28% and ether suffered a 40% loss, reaching the 6-month minimum.
The sudden collapse is said to be tied to the movement of the tech stocks, as the Nasdaq composite stock index fell by 5%. (Some analysts claim that the real reason is not that simple).
Other possible reasons could be macroeconomic: the stock market is in a comparable position because of the US Federal Reserve press conference. The topic was the asset-purchase program and various related policies; the announced conclusion points to the increase in federal funds rate.
The proposition of a blanket ban on cryptocurrencies by the Central Bank of Russia did not seem to shake the markets much. Russia is now walking away from the ban in favor of regulating.
Now that the sudden selloff is slowing down, are you asking yourself, “What coins should I buy for dip?” If yes, then read on for our list of cryptos to buy during the dip.
Cryptos to buy during the dip
Regardless of the reason, this correction could pose a chance to buy the dip. Speaking of, what is the “buy the dip” strategy, exactly?
Simply put, this is a contrarian angle to the golden rule of trading — “buy low”. When the market cools down, and the price bounces up, there will be a good chance to sell high for profit.
But for that chance to be guaranteed, you need to know options that have enough potential to recover. What are the best cryptos to buy now?
Check out five cryptos to buy during the dip that we think are a safe pick.
This one is obvious: after all, it is the original cryptocurrency and is the most adopted one. History proves that in Bitcoin there have been multiple cycles of dips and rallies, each culminating in a new record.
From January to April 2013, BTC rallied from $13 to $230. The sharp correction took the price down 70%, to $68 — which is still a 423% profit from the 2013 opening price.
A similar pattern occurred in 2017-2018: the price pumped parabolically to little shy of $20,000. The subsequent weeks saw a sharp pullback below $7 thousand but again, it’s worth remembering BTC at the start of 2017 was trading below $1 thousand.
Is Bitcoin dip 2022 the same? Time will tell, as this cycle seems to be playing out differently so far.
At the moment of writing, one BTC is traded for $36,413.60. Bitcoin is down 21% in comparison to the opening price in 2022.
Many Bitcoin bulls claim that the $100,000 target is still on the table — but maybe later than sooner. Stock-to-flow model author Plan B still sticks to it, and despite being in the red, El Salvador president Nayib Bukele continues to announce dip purchases.
By 2022, the sheer volume of utility in the Ethereum ecosystem is nothing to sneeze at. Like with Bitcoin, it should be out of question whether one needs to buy the dip of ETH.
Ethereum was also hit rather heavily in the correction. On the weekend, its daily losses came up to 14% and caused massive liquidations of collateral in MakerDAO, Compound and Aave.
At the moment of writing, one ETH is traded for $2,438.79. Ethereum is down 34% in comparison to the opening price in 2022.
What’s in store for Ethereum in 2022? Ethereum will keep facing stiff competition from layer-one blockchains such as Solana. On-chain data suggests that at the moment value is flowing out of Ether into altcoins and even NFTs.
Nevertheless, the upcoming shift to Proof-of-Stake can help ETH secure its leading position. By the way, the Ethereum Foundation ditched the “Ethereum 2.0” label, and now it is called “Consensus Layer”.
The following altcoins are included in the cryptos to buy during the dip list because they managed to outperform both BTC and ETH in 2021 and 2022 so far. Why did Fantom do better than the rest?
Over the course of 2021. Fantom went parabolic from $0.017 all the way up to $2.25. This is a 13,135% growth in a year.
In 2022 alone Fantom outperformed Ethereum in more ways than one: it beat its transaction activity on Monday. The DeFi network flipped Binance Smart Chain after the launch of 0xDAO (DEX), Multichain (cross-chain bridge) and announcement of Solid Swap (AMM).
At the moment of writing, one FTM is traded for $2.19. Fantom is down only 3% in comparison to the opening price in 2022.
Fantom almost reached a new ATH on January 16, pumping to $3.35 not long before the market carnage. The drop caused it to return to the $2 support but the trading volumes and technical analysis suggest the discount may not last too long.
Altcoin Sherpa, for example, predicts that the $3.3 resistance may be broken soon, which means a new ATH.
Another unexpected asset in cryptos to buy during the dip is Cosmos. Its fundamentals proved to be so strong, that it actually rose during the selloff.
Cosmos’ ATOM managed to rise by 8% during the bloodshed. The defying factor was the anticipation of airdrops of Cosmos’ hub tokens and the bridge to Polkadot.
At the moment of writing, one ATOM is traded for $31.09. Cosmos is down 5% in comparison to the opening price in 2022.
Despite that ATOM has already shaken off the gains, it might still be too early to buy in. Before that, analysts recommend to watch whether ATOM defends support levels at $25 and $20.
More opportunities for growth are certain to appear in 2022, as four major upgrades and the bridge to Polkadot are in the works.
Near Protocol (NEAR)
Another layer-one network that attracted attention among cryptos to buy during the dip is Near Protocol. Unlike the previous two, it sports an Ethereum Virtual Machine-compatible platform Aurora, where the dApps can already migrate to.
NEAR somewhat repeated the price movement of ATOM and FTM. Unlike these two, it actually managed to score a new ATH on Jan 15, 2022: $20.42.
It is already down 45.47% down from the ATH but the good news is: you won’t be buying the high!
At the moment of writing, one NEAR is traded for $11.13. Near Protocol is down 23% in comparison to the opening price in 2022.
So where does the confidence in the bounce come from? In the short term, NEAR entered the oversold area very quickly, creating circumstances attractive for buyers.
In the longer term, Near Protocol’s Aurora and Rainbow Bridge were cited by the Panthera Capital’s analyst as the features that can cause explosive growth of the ecosystem.
What coins will explode in 2022? Whatever any shiller says, the real answer is, no one can tell you for sure. These five cryptocurrencies, however, are a safe pick to profit within 2022.
Did you enjoy the analysis? Do you have your own ideas? Make sure to let us know in the comments below or on social media (Twitter, Facebook, Reddit and Telegram)! Check out our blog for more crypto news coverage and educational articles.