Crash. What is it and how to avoid its consequences?

Everyone knows that now the atmosphere of the wild west reigns in the crypto-currency market. Chinese miners create their forks, start-ups come out every day, as a result of which, new currency pairs arise, and whales of the market control the course in their own interests, creating the necessary information background.

Of course, there is relative stability, but from the market you can expect anything. Manipulation of the course in someone's interests is still a common thing. 

In the case of traditional markets, such illegal actions are prohibited. Although, various supervisory authorities periodically initiate criminal cases against trading players and even fine banks that, in pursuit of excess profits, are creating nightmares for the market. In the list of distinguished periodically fall Royal Bank of Scotland, Citigroup and JPMorgan. What can we say about cryptomarket, in which there are no supervisory bodies, and anyone who owns capital gets powerful levers of influence at the auction and is in fact not limited by anything.

Crash it is a sharp collapse in the exchange rate caused by artificial or natural causes.

It can occur in a natural way, after an event that could potentially cause panic for investors, or caused artificially, by creating a resonance of factors that can influence the exchange rates. Often, attackers use the so-called "stratification" strategy, placing orders for the purchase or sale of currency on a special scheme, which creates the illusion of pressure on the asset in the direction of decline. After forming the necessary information background, it is possible to expect, with a high probability, that any negative event will cause an avalanche-like collapse of the course. If the asset is highly liquid and has a certain real value, the rate will be restored, which means that such moments are ideal for issuing purchase orders.

The example of such event is the recent crash of the second currency, by the market-capitalization, Ethereum, which occurred in June 2017.

It all started after the beginning of crowdsale of the long-awaited Status project, whose execution of a smart contract led to a critical failure within the network. This caused the impossibility of carrying out transactions in the ecosystem. The oil was added to the fire by the fact that the official observer of the Ethereum network blocks was temporarily absent.

The exchange rate sank by about seven percent. But the most interesting began later. One of the players issued a warrant for the sale of 96 thousand Ethereum coins, which totaled approximately 30 million US dollars. After its execution, numerous stop-orders began to work, which provoked panic and an avalanche-like fall in the rate. For a couple of minutes, Ethereum fell from 300 to 13 dollars. After a while, the course quickly recovered, but someone already had a good chance to earn decent profit, and in 10 minutes there was another crash, but not so deep.

The story with Ethereum is not special. Most of the crypto-currencies is much less capitalized and more vulnerable to market manipulators.

Periodical sharp failures of a course occur constantly on various currency pairs. Especially if we are considering a period dominated by a "bearish trend". As an example, we can use ripple, whose rate has constantly slowly fallen after an unprecedented growth in May 2017. About once in every two weeks, this drop was interrupted by crashes, as a result of which the rate fell by 15-20 percents, then it was restored but by 25-30 percents. 

Some traders "put buckets" in order to catch the collapse and buy the currency at a delicious course. But in order to correctly predict the event and put the order on the right currency pair at the right time, you need to perform a detailed analysis of the data. Users of Cryptics are spared the need to search and analyze a large amount of information, from raw data from exchanges to the analysis of social networks and media. The system of intellectual trade constantly monitors the set of crypto-currency pairs and performs calculations for the analysis of events in real time. You just have to go to the control panel and get the information you need, or entrust your funds to AI system. A unique intellectual trading mechanism will independently assess the risks and conduct the necessary transactions.

If you want to protect your funds and sell a low-liquid asset in case of a possible collapse caused by natural factors, you can use the platform`s crush prediction - the self-learning tool that predicts and reflects to the crash event in the real-time, which gives its users a possibility to earn creamy profit on each currency crash. 

Source: Cryptics.tech, @Cryptics_Eng