The Fear and Greed Index can help investors understand where the market sentiment is and give them objective information about changes in sentiment before there are even any changes in price.  When the market is hot, greed rises and some investors may inadvertanly remain in a trade much longer than they probably should have. This realization is good to have but the trick is to respond before its too late. 

On the otherhand, fear is the antithesis to greed, and will typically cause investors to quickly exit their position way too early.  Fast and steep movements in price are more often than not influenced by whales aiming to shake retail investors from their positions.  Granted, there are legitimate signals that indicate a market cycle top and those are typically marked by off-the-charts greed and, within a short period of time, a massive rolling state of fear and panic followed by intense sell pressure. 

 The key is to not follow the herd, learn to identify reliable sources of information which are not intended for the sheep.  Become a cool hunter, remain level-headed and objective, understand the tools at your disposal and use them to strike when the time is right according to all your "senses".  An investors senses is their indicators. Identify a few good indicators that fit with your trading strategy and style, becoming an expert at their use by doing research, practicing on simulation apps, and tracking performance over time. This approach added to any trading strategy is one way to improve results and maintain a sense of dignity when caught off guard by the inevitable dump that comes out of nowhere. 

If you are new to crypto, you probably have heard about the DCA strategy. This is when a set amount of money, typically no more than an investor can afford to lose, is invested at regular intervals. Many centralized exchanges (CEX's) allow automatic timed purchases, which is a great way to accumulate a position and take advantage of the law of averages to moderate the average purchase price for those assets. This method allows traders to profit from market increases without putting a significant amount of their holdings under market risk. 

The investor will select a fixed amount of money to invest in a particular cryptocurrency and establish a frequency of purchases that fits within their investing budget and risk tolerance.  This method does not time market movements, the purchase is made automatically each week or bi-weekly, until the investment goal is reached. 

A DCA strategy smooths out the average purchase price and separates the stress of staring at the screen all day waiting for the perfect time to buy. 

This is a long-term investment strategy and may subject the investor to high costs in fees. This is because CEX's typically take advantage of new retail investors who are unfamiliar with low cost decentralized exchanges (DEX's). 

It is a prudent approach, for any investment strategy in cryptocurrency, to conduct thorough research before adopting any trading strategy. 

When conducting research, it may be helpful to connect with experienced community members in your favorite project. Discord and telegram have many communities that are friendly and helpful for learning more about a cryptocurrency project. Simply going to the project's website and finding the social media icons at the bottom of the page. 

We combine the Lump-Sum Trading strategy with the Trend or position trading because they typically go hand in hand for the newer or intermediate investor.  

Trend retail investors will oftentimes hold their positions for a few days to a few months, buying into a trade when the market is low and exiting the trade when the price goes higher.   This allows a retail investor to profit from directional movements of the market, trends, using various signals to determine the best timing of those entries and exits. Some trend traders may also enter into short positions when they anticipate downward market movements.  However, they may also invest for the long-term if the market is expected to move into an upward market movement like a bull market, if they are able to get into a trade at a low price comparable to lower price targets called support. 

This strategy involves a deeper understanding of indicators, to determine wheree resistance is and support will be when the price begins to fall. The key is to understand the trend, as they say in trading, the trend is your friend until the end. 

Investors in this strategy will identify trend reversals using indicators like moving average convergence divergence and the stochastic oscillator to improve the probabilities of success in their trades.  This strategy comes with significant risks, depending on the amount of capital being used,  Educating oneself on the use of indicators is the key to success, as is understanding the volatility of both the market and the particular asset one is investing in. 

Fast swings in the market are often intentional, as market makers and whales who are using large amounts of capital to move the market one way or the other, typically in an effort to accumulate the liquidity that is entering the market by retail investors. 

Education is key before committing large amounts of funds and trading more stable assets that have a larger market cap until the skills can be built up over time. Using sound risk management techniques is key to success, such as setting s stop loss somewhere near the entry price. This will alow the trade to be "stopped out", or terminated, if the price is at risk of going below the entry price.