This is my first published idea. I've gained a great deal from this community so I think it's my obligation to contribute what I might have learned from everyone at this great resource:
Every mistake I've made since entering the crypto space in December has come from overthinking the market. Here's some examples and advice, followed by what I think is going to happen with crypto:
1. In Dec: Ripple is only $.25, and newbies might try to buy coins with smaller numerations. That's too obvious, I'll focus on solid stuff like Bitcoin, Eth, and Litecoin, which have recently given me big returns. Ripple proceeded to go to above $3.00, while my solid coins floundered.
2. I won't waste my time on sh@tcoins like Tron and Verge. I'm too pure-hearted to buy anything except the stuff with solid fundamentals like BTC, Monero, Litecoin, Digibyte, DGD. Result: I could have had a Tesla, but I'm driving a Honda. Don't be elitist, buy what people will like. It's ok.
3. Just HODL, don't daytrade. 90% of daytraders lose money. Really? Whoever said that must have been in a bull market. After seeing my portfolio eviscerated in Jan and Feb, I've gotten punched in the face and knocked down many times since I went into cash in March, but I've relentlessly focused learning from my mistakes, and just a few hours ago caught my first falling knife! (and that's another BS piece of advice we often hear, I am trying hard to learn to catch falling daggers, the stop-loss is so small it makes up for the failed buys). Practice with small sums of money to get your confidence up. It will come!
4. Adam and Eve pattern a few weeks ago, along with huge bullish divergence after weeks of falling price. Bah. I'll just wait for the market to show it's hand to me then I'll commit. Guess what? Where I live the $1000 in one-hour pump happened at 4am. Should have hedged with 3% stop loss. Would have caught the bottom.
Here's where I think we are going:
1. Pump happened right after death cross. My 50, 100, and 200 EMAs are green, yellow, and red. We are now seeing the 50 cross back above the 200. Please go back to April-June 2014 on the Bitstamp chart and see how the price surged upwards after the death cross occurred, then downward after it went back. Why? I think that smart money saw this coming and priced this in, because they knew rubes like me would believe the hype. Then, when it became apparent that market cap had topped out people took profits. If we compare to current circumstances, it will be interesting to see if we see a similar decline. We seem to be stuck at $450B total market cap. When people decide that's as high as it's going they'll take profit.
2. Compared to the crashes of April 2013 and November 2013, which took 3 months and 13 months to bottom out respectively, our angle of decline is about in the middle. If we project this out, it would suggest a bottom of between $3-5k sometime this summer if we have a total retracement of somewhere between those two crashes.
3. If we take the Fib retracement from the Feb 20 recovery to 11.8k down to the April 1 low of 6.4k, we have a just about perfect reversal between the .618 and .65. Those bots were strong enough to turn bitcoin back twice, and they'll be looking to buy between 7.6 and 8.1k. That's where I'll be looking to go all in if we go down again.
4. This pump was caused and fueled by a short squeeze, not an influx of new money. Have a look at the balance of longs:shorts now. It's about 2:3 in favor or longs. That's like having TNT laying around waiting for a spark. If it happens we're going down as fast as we went up.
I probably sound pretty bearish, but the more I learn about crypto the more I'm convinced it's going to do more good for the world than the Internet did. We're very lucky to be able to take part in this, let's enjoy! That's what I've got. I hope it was helpful, and it paid back some of what I got from being here!
Not financial advice!
Every mistake I've made since entering the crypto space in December has come from overthinking the market. Here's some examples and advice, followed by what I think is going to happen with crypto:
1. In Dec: Ripple is only $.25, and newbies might try to buy coins with smaller numerations. That's too obvious, I'll focus on solid stuff like Bitcoin, Eth, and Litecoin, which have recently given me big returns. Ripple proceeded to go to above $3.00, while my solid coins floundered.
2. I won't waste my time on sh@tcoins like Tron and Verge. I'm too pure-hearted to buy anything except the stuff with solid fundamentals like BTC, Monero, Litecoin, Digibyte, DGD. Result: I could have had a Tesla, but I'm driving a Honda. Don't be elitist, buy what people will like. It's ok.
3. Just HODL, don't daytrade. 90% of daytraders lose money. Really? Whoever said that must have been in a bull market. After seeing my portfolio eviscerated in Jan and Feb, I've gotten punched in the face and knocked down many times since I went into cash in March, but I've relentlessly focused learning from my mistakes, and just a few hours ago caught my first falling knife! (and that's another BS piece of advice we often hear, I am trying hard to learn to catch falling daggers, the stop-loss is so small it makes up for the failed buys). Practice with small sums of money to get your confidence up. It will come!
4. Adam and Eve pattern a few weeks ago, along with huge bullish divergence after weeks of falling price. Bah. I'll just wait for the market to show it's hand to me then I'll commit. Guess what? Where I live the $1000 in one-hour pump happened at 4am. Should have hedged with 3% stop loss. Would have caught the bottom.
Here's where I think we are going:
1. Pump happened right after death cross. My 50, 100, and 200 EMAs are green, yellow, and red. We are now seeing the 50 cross back above the 200. Please go back to April-June 2014 on the Bitstamp chart and see how the price surged upwards after the death cross occurred, then downward after it went back. Why? I think that smart money saw this coming and priced this in, because they knew rubes like me would believe the hype. Then, when it became apparent that market cap had topped out people took profits. If we compare to current circumstances, it will be interesting to see if we see a similar decline. We seem to be stuck at $450B total market cap. When people decide that's as high as it's going they'll take profit.
2. Compared to the crashes of April 2013 and November 2013, which took 3 months and 13 months to bottom out respectively, our angle of decline is about in the middle. If we project this out, it would suggest a bottom of between $3-5k sometime this summer if we have a total retracement of somewhere between those two crashes.
3. If we take the Fib retracement from the Feb 20 recovery to 11.8k down to the April 1 low of 6.4k, we have a just about perfect reversal between the .618 and .65. Those bots were strong enough to turn bitcoin back twice, and they'll be looking to buy between 7.6 and 8.1k. That's where I'll be looking to go all in if we go down again.
4. This pump was caused and fueled by a short squeeze, not an influx of new money. Have a look at the balance of longs:shorts now. It's about 2:3 in favor or longs. That's like having TNT laying around waiting for a spark. If it happens we're going down as fast as we went up.
I probably sound pretty bearish, but the more I learn about crypto the more I'm convinced it's going to do more good for the world than the Internet did. We're very lucky to be able to take part in this, let's enjoy! That's what I've got. I hope it was helpful, and it paid back some of what I got from being here!
Not financial advice!