When an asset’s value drops, it can be said to “dip.” The term is used across a range of financial markets and is often used to describe the price fluctuations of cryptocurrencies.“Buying the dip” is a technique in which investors take advantage of drops in an asset’s value. By purchasing at a lower price, investors “average down” their asset purchase price or maximize profits on undervalued assets. Many markets, however, are highly speculative. And this is particularly the case with the cryptocurrency market. A dip in the value of an asset may signify the start of a longer downward trend. A future bounce back isn’t a given. Waiting for price settling, undertaking due diligence, and utilizing incremental buying protect buyers against poor investments.
