What is Ghost Month, and How Does It Affect the Crypto Market?
As of late August, the digital currencies are seeing little or no change during a trade. This is said to be related to the start of “Ghost Month” in the nations where the majority of these cryptocurrencies are domiciled and where the majority of their investors are based. People in these countries believe that investing in anything during the month is particularly risky.
Ghost Month Origins
In Chinese culture, Ghost Month and Ghost Festival are significant events. It is also observed in Asian countries such as Taiwan, Malaysia, Japan, and even India. This does not imply that the market falls every year for traders. It does imply that there is less liquidity in the financial markets, regardless of market performance. During this time, the number of visitors from Asia are mostly low even on the most popular platforms such as Bitcoin-loophole.io or Gemini.com despite a reportedly successful trading record.
The Festival of the Hungry Ghost is a Chinese tradition observed by Buddhists and Taoists in the seventh month of the year. The gates of hell are said to open during the occasion, allowing the ghosts that dwell there to traverse the world. According to folklore, everyone should concentrate on thanking or praising the spirits who are visiting the earth at this time.
The Festival of the Hungry Ghost is when the gates of hell open and spirits from there wander the world. According to folklore, one should concentrate on respecting the spirits who are visiting Earth at this time. Many individuals in the stock market get afraid of the ghost month as it is considered bad luck.
The Chinese calendar’s seventh month will run from August 11 to September 9 of the year. People are urged not to spend a significant quantity of money at this time. Large gatherings, such as weddings and baptisms, are strongly avoided. Out-of-town excursions should also be avoided.
People avoid purchasing a house, starting a company, getting married, making major financial decisions, and other major life events during ghost month. Because of the dread of going into debt, the stock market generally moves down or up during the ghost month.
This is a time to be cautious for traders, but it is a fantastic opportunity to purchase for long-term investors, especially blue-chip stocks that have fallen owing to the market’s temporary weakness. If you bought during a downturn in the market, your paper loss would be gone in 5 years or less. The performance of your stocks might be considerably better or much worse.
This is an excellent topic to cover for investors in psychologically-driven assets like stocks and crypto, where the market’s trajectory is heavily influenced by public opinion. The majority of stocks and crypto assets are in a negative trend. This makes sense, given that the vast majority of stock and cryptocurrency investors are Chinese individuals who adhere to the ghost month doctrine. Those who are strongly motivated by FUD (fear, uncertainty, and doubt) as a result of this mindset might make the bear angrier.
If you’re a long-term stock market investor, you have nothing to fear or be concerned about. There’s also no need to be concerned about the ghost month if you’re a medium-term stock market trader, particularly those who use the Strategic Averaging Method (which is popular among Truly Rich Club members). Continue to buy your preferred stocks, but be cautious when they approach your support level. If you’re a short-term trader, finding suitable firms to trade with might be difficult at this time. There’s still time to make money, but exercise greater caution than normal.
Cryptocurrency traders may be able to profit from a quiet month in the market by gradually building up their holdings while prices remain low. If approached correctly, this may be an excellent opportunity to score some great deals.
If you’re a day trader or aiming for quick profits, you should be cautious with your transactions and consider putting stop losses in place to avoid plunging into the depths of red bars. Generate income while the market is still low. Do your monthly chores and wait for the market to rebound to reap the benefits of your financial discipline. Will you take advantage of this, or will you dismiss it as superstition with no place in the crypto trading world?