U.Today – Veteran cryptocurrency advocate and researcher, economist Raoul Pal shares his personal opinion and recommendations for all cryptocurrency traders and investors affected by the ongoing price decline. He admits that “maximum fear” has arrived, but expects all his followers to hold on.
‘Violent Shocks in the Zone of Maximum Fear’: Raoul Pal on the Cryptocurrency Collapse
Today’s cryptocurrency crash is a “shakeout” and a reset of risk-taking levers, economist Raoul Pal shared in his X post. He still predicts powerful growth as a major feature of the entire 2024-2025 period, but warns that both the policy and liquidity response could take time.
Markets have already entered the “maximum fear” zone, he admitted. In just one week, the Crypto Fear and Greed Index has fallen from 74/100 to today’s level of 26/100, which is the upper level of the “Fear” zone.
As such, it is imperative to hold on and move away during periods like this. In some ways, what is happening today is natural for bullish phases in cryptocurrency markets, the economist says:
In summary, for Pala this landfill is simply an “unpleasant washout.”
Early today, the price (BTC) fell below $49,500 to its lowest level since mid-February. The total amount of liquidations exceeded $1.22 billion in equivalent.
No leverage, no FOMO, no noise
Pal concluded his post by sharing a few rules for surviving such events with minimal damage. First and foremost, he recommends avoiding falling victim to FOMO and using leverage on futures positions.
Instead, a good trader should focus on a basket of a maximum of 3-5 assets, while the “degen” (high risk) allocation should be restricted to 10%.
Next, due to the increasing risk of attacks, Pal recommends using only on-chain wallets with self-custody or even multi-signature support for cryptocurrency operations.
Instead of trying to outsmart the market by “catching knives,” the economist recommends considering a HODL strategy. He has announced that he is not selling anything and says that adding to long-term holdings could be a astute bet on a downturn.
