Crazy Dump, 400k Failed Traders, Emotions and What to Do

It was an amazing dump! It was a great lesson for those who ignored the value of knowledge and experience. It was a super valuable example of "What will be IF..." for those who bought Bitcoin and other altcoins without thinking and planning such trades.

As a result, 396 000 traders blew $2.5B within 24 hours! They gave their own money to Market Makers, Manipulators, Whales, Institutional Investors, and just Smart Traders. These traders made a mistake in the past, thinking that they would make tons of profit in a simple way.

In average, every trade paid about 6300$ for such a lesson!



What about the situation in the crypto market?

Of course, we can see a strong bearish sentiment in the market. We may think that the bearish pressure destroyed the bullish market, and we shouldn't expect an upward movement in the nearest future.

Bitcoin has been moving downward from 69 000$ these weeks, and probably we shouldn't talk about a correction anymore. The price reached 42 000$ point, and it is -39% from the ATH. For Bitcoin, which is not so volatile as other coins, it is really a lot.

But I wouldn't say that we are in the bearish market for the months. I think the dump was the reason of manipulations first of all. I didn't see any solid news which could push the price downward. That's why I would consider the bearish period, but also I would think about the reversal from the local bottom and a new upward wave in the direction of the ATH.

Yes, it may sound weird, but from my point, this dump could be the part of the perfect plan to kick "wrong" investors from the market, get their money and push the price to the ATH after that. That's why I'm averaging my long positions. I use the dump to rebalance my portfolio, add new positions from the local bottom and watch for further market movement around the current levels.

Look at the daily chart of Bitcoin. The price reached very strong support between MA200 and 42 000$-40 000$ support levels. RSI is in the oversold zone. If the bulls can defend the support, it will be able to start a solid bottom for the market. Bullish setups will allow opening new long positions, and the market will have everything to reach the ATH and even update it. Of course, we will need much more time for such a movement. We should forget about Bitcoin for 100 000$ in 2021. But in the long run, the new ATH will be a reachable target for Bitcoin and altcoins.

Maybe you think that only stupid traders buy when the market is super bearish. But I want to remind you that the best trades for buying come when there is no hope in the market.
It is not a mistake to buy at lows, average trades, think about new highs when the majority expect new lows. The main mistakes are in wrong money and risk management.

I plan my trades considering bullish and bearish directions. I have the exact trading plan which tells me what to do in the market, where to open trades, how to manage them, what to do if the price moves in my direction and against me, where to exit. Such an approach makes the main difference between gamblers, who blew $2.5B during these 24 hours, and professional traders who could protect their profit and capital and now have everything to catch new trade opportunities. Definitely, I want to be on the right side. And what about you?