The Impact of Covid-19 on Trading Markets
Supplementing our incomes during the pandemic has been driving new traders in droves to trading sites over the past year. Both experienced traders and novices were motivated to learn more about how forex trading during Covid could help build up their savings. Lockdown afforded us more time to navigate the unchartered waters of the trading world. Furthermore, trading became a plausible way to make a profit. Whether trading full-time or buying and holding, riding the wave of increased volatility due to the coronavirus, makes the opportunity to profit a reality.
A Brief Insight into the Markets Over the Last 12 months
2020 has been a tumultuous year. When you combine a global pandemic with the stock market crash of 2020, we both feared and expected a recession. Restaurants and retailers were forced to close their doors because of the lockdown. Investors everywhere were worried about the long-term effects of coronavirus on the market. In addition to the threat of illness, people have lost their jobs, their retirement savings, and even their businesses.
With panic on the rise, people started liquidating their stock to preserve the value of what they had left. Others held still, praying to recover with some short-term gains. Whether right or wrong, faced with uncertainty, people tend to act impulsively.
How Long Does a Bear Market Last?
Like those bears hibernating for most of the year, a bearish market can last up to 10 months before turning around. While fluctuations are expected in the trading world, a 20% drop generally indicates a bearish market.
Prior to World War II, bull markets happened every year and a half. Since then, things improved, and we’ve experienced bull markets roughly every five years. But in March 2020, we witnessed a stock market crash. Thankfully, the bear market transformed a few months later to a bullish one, whereby in August, stocks closed at record highs.
Crypto New Lows in March to All-Time Highs in December
We also witnessed incredible highs in cryptocurrencies following a disastrously low valuation for Bitcoin in March 2020. Within a few short months, the crypto world turned around, and Bitcoin saw record highs by December.
Why Now is a Great Time to Invest
We saw an incredible amount of yo-yoing in the 2020 market, but stocks like Gold still managed to end at a 28% high by the end of the year. We also saw Amazon stock up 73.5% and Bitcoin up 160% by the end of November. So, despite the short-term falls because of Covid-19, not all market investments sank.
Some investors see the lower prices as opportunities to gain. Most of us are still working remotely, so why not use the time you save on commuting and learn more about the forex market! Moreover, use the funds that you would have spent on entertainment for a slice of the crypto pie.
Takeaway
We all know that the crypto and forex markets can feel overwhelming. However, when armed with the relevant knowledge, there is money to be made. When getting started, choose a platform that you can trust and that offers round-the-clock support. Having clear objectives and understanding the level of risk that you are comfortable with is key to succeeding. The market moves at full speed and is almost impossible to predict, so a level head is equally important.
Step into the Future of Trading with TradeOr
With TradeOr, you can rely on our support team 24/7! You can consult a suite of video tutorials to help you open and secure your account, a step-by-step guide to making your first deposit, and how to withdraw your funds. What’s more, we show you how to add the different markets and currency pairs to your watch list so you can get the most out of your account. Step into the future of trading with TradeOr now!