Maybe I'm not the right person to ask, since I'm a natural contrarian, but I'll try to express my experiences for this bubble:
- I saw the bubble forming in december with that parabolic run up, comparable to any time prior and any market, especially when it was advertised so much on MSM and even normies where talking bitcoin and new crypto people trying to become hedge fund managers, those were some bad signs, especially when cnbc teaches people how to become millionaires buying xrp around $2 to $3.
Quote: "When the shoeshine boys have tips, the stock market is too popular for its own good" - Joe Kenney
- I was bearish since January after a hard smashdown through a local fib on the 1h followed through on the larger structure and luckily could have sold on the bounce at 17k, then I knew the bubble popped after hard dumps;
- Was scalping between fear and capitulation with barely any sleep, sometimes no sleep at all, but 1-2 hour naps before the next alarm went off. What a hell of an exhausting time!
- The capitulation phase was insane, I still can remember some guy dumping one 12k bitcoin order followed by another 3k order, a signal for me that the bottom was probably almost in. The price action was insane, jumping all over the place, but I've enjoyed watching and scalping it, a time never to forget :-) The funny thing is, I was more frustrated with Kraken with their issues than anything else, but luckily, I trade on all the other major exchanges as well;
- Then came the run to the double top and I became bearish after seeing fake bot pumps all the way up to the double top, within a rising wedge pattern. It reminded me of Dow Theory of a double top bull trap (which I've posted in my quick scalp post): tertiary trend within secondary trend within primary trend;
- The dumps in the despair phase I did not saw coming this sharp and got rekt in a scalp I was in when bitmex logged me out and kraken went offline when it started dumping, knowing to be liquidated and sitting with a bag that I could have sold for a small loss at the bounce for the latter.
- Then came the 7.25k bounce and everyone was super bullish to the moon again, but as for me, it was just a premature reaction based on nothing, but g20 excuse;
- Then came the depression phase, where I saw it as an opportunity to buy and had been buying for over a week. It was no more scalping, only accumulating. It helps to see it at a discount price from the top, not a bad price after all.
After learning from dot com, I think this bubble pop went pretty well for me. Had one big loss vs great winners. I think the hodlers that have bought it around the top will be happy in the near future, unlike dot com, this market is almost ready to become huge after regulations and implementation phase.
I'd love to read more experiences from others, including you buddy :-)
Like you I learned some hard lessons during the dotcom bubble. There was a point where everyone and their mother was literally speculating on tech stocks including mine. I blew up my first account that year, half my stocks were delisted, the other lost 80% of their value and went mostly to paying fees on my brokerage account. I sold near the bottom like a chump and then watched in horror as they took off again. I did everything wrong and I resolved that if I were to see another event like this in my lifetime I would never allow the same thing to happen again.
I got into crypto late, procrastination...skepticism, call it what you will but I didn't jump in until bitcoin was around 5k. I'm still upset about that. I have a tech background, I'm a libertarian, I've known about bitcoin since 2009... what was my excuse?
- I took some profits around 10k. Maybe too early but I could sense us going parabolic and didn't want to get burned. I watched in amazement as we rose towards 20k, still very skeptical as kids much younger than me were convinced of a perpetual bull market. At a fast food restaurant the cashier overheard me mentioning bitcoin and said that she had bought some. That Joe Kennedy quote resonated with me.
- Was making a killing off alts in november/december/january, and went all fiat at 17k range and waited for the crash. Everyone was calling out ridiculous targets like 50k and I was being attacked in chat for pointing out obvious things like bearish RSI divergence.
- I thought 10k was the bottom and jumped back in, doubled up on the way back up and was elated.
- Failed to see the January bull trap for what it was, but my guard was up and as soon as we broke below 13k I went to all fiat again. My biggest loss, but I'm glad I didn't ride it all the way down.
- Scalped on the way down with small position sizes to keep myself busy. Really wanted to short but didn't have a margin account at the time. (I thought BFX and MEX were my only options and I'm in the US). Traded only USDT pairs.
- Caught a few falling knives and took small losses on stop outs.
- Thought 6k was the bottom and went all in at 8k.
- The run to the double top didn't smell right to me, and I had suspicion that it was a B wave... volume was dropping as we went higher and the structure didn't seem impulsive. Sold 11k on the first top.
- FOMO'ed back in at 10k to the double top and paid for it. I saw the drop coming but didn't think it would be that sudden and that deep. Didn't raise my stop losses in time and took a significant hit getting out around 9.6k
- Shorted my way down to 7.2k while everyone was calling for 3k I knew the bottom was near as price spread was tightening and volume was dropping on the dumps. Also, there was a huge amount of panic amongst the traders, but very little volume on the way down.
- I had a little too much hope on the run up to 9k and psychologically, I was depressed when that breakout attempt failed. I stopped shorting after 7k feeling like a squeeze was imminent. Meanwhile I noticed that people who were once permabulls were becoming permabears. I knew this was the time to begin accumulating so I started buying alts that I was fairly sure were bottomed.
I could sense the depression in the air. Heck I could sense it in myself. It was like a heavy blanket over the market. People kept saying that we needed a real capitulation, but I think that was more the bears in large short positions driven by greed rather than sense.
88.6% happens in bubbles, but crypto is maturing and this is the year that large amounts of capital are being poured into the market both in private equity and coins. This is the year that we will begin to see real business use cases and recognition by regulators and institutions. Capitulation was clearly in February in that classic waterfall pattern. This move down to 6.4k was diminishing in strength not picking up steam. The confirmation for me was the 10 day accumulation period and constant retests of the bottom.
- I bought the bottom :) I figured, probability was on my side. Upside far outweighed the downside after a 70% correction. Crypto isn't going anywhere and everyone knows that. I had also come to terms that I was more stressed out when I was in fiat than I was when I was building my coin holdings. It's been house money since last year, and I couldn't allow my fear to cause me to miss opportunity. I remember a quote by Baron Rothschild "Buy when there's blood in the streets." I think this the difference between the whales and the minnows. Whales and minnows both feel the same emotions of fear and greed, the difference is the whales are always emotionally one step ahead while the minnows buy the tops and sell the bottoms. I'm a minnow, but I want to swim with the whales.
My end game has always been to build a sizable crypto position and swing trade to increase my account, but entering the market in the middle of a parabolic move was never ideal. I wanted to get in when the smart money did. I believe this is a (potential) opportunity to do so. You're right, this has been an incredibly exhausting experience. Vacillating between FOMO and fear constantly, waking up in the middle of the night to alarms... Learning to day trade and scalp even though I'm not an intraday trader. In the end I think I can say I came out of it relatively unscathed, and a lot wiser. Hopefully, I can take this experience into the next bear market.
Next came rally to 11.8k and yes I still held. It was a bull trap
By 8k i switched bear. I wasn't depressed by 6.5k as Id made some $$ shorting :)
Now people think its a suckers rally. I feel different as I got on the right side of the trade ;)