What drives crypto and other markets? The Market Cycle

TL;DR

> $JMPT shows strong performance in September, currently at $2.77;> Market cycles are asset value fluctuations happening repeatedly;> Understanding cycles helps to avoid losses due to panic selling instead of HODL;> Psychology and economics play an important role in driving market cycles;> Investors should pick assets or projects only after due diligence and research.

What is the market cycle?

  1. The market cycle explains that asset values are volatile. This helps to understand that sometimes losses are inevitable. However, HODL can work in the long-term, as asset values tend to return to previous heights.
  2. Understanding the cycle helps to decide when to enter and exit a specific market to increase profits. For example, investors understanding the cycle could avoid panic selling when prices decline.

The four stages of the market cycle

Accumulation

Mark-Up

Distribution

Mark-Down

Why do the market cycles happen?

1. The Business Cycle

2. Investor Psychology

  1. Fear of missing out (FOMO). This phenomenon typically occurs in the mark-up or distribution phase. Investors don’t want to miss out on gains and buy without properly researching projects and companies.
  2. Hot hand fallacy. Hot hand is a belief that an individual or entity is more likely to have continued success because one has had a string of successes.
  1. Timing is challenging. Cycles can last for years, months, or even weeks: it is difficult to assess the cycle stage and decide when to invest. However, understanding psychology helps to avoid selling at a loss.
  2. The cycle may come to an end. Individual stocks or crypto projects might fail, and their values could go to zero without rising again.

$JMPT price performance

1. Constant demand loop

2. New platform features

3. Expanding task offering

4. Growth potential

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JumpTask

JumpTask

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JumpTask - the gig economy-based marketplace that allows companies to make the most out of the collective skills possessed by a globally dispersed workforce.