Remember When Everyone Was An Awesome Bitcoin Investor?
It's been two and a half years since I started investing in cryptocurrencies and boy does it feel like an eternity. Given the crypto market is only 10 years old I guess it is a long time. I have invested in stocks for 20 years, but that market has been around for more than a 100....hmm, turns out the ratios are the same.
Maybe that is why I feel comfortable trading crypto?
The Everyone is an Awesome Bitcoin Investor Chart:
Ya'll remember this period of time? The second half of 2018, now a full year ago it feels like a distant memory, but it also was a warning signal that shit was gonna go pop in the near future.
See, during this period everyone was an awesome bitcoin investor. I knew guys that had never actively invested or traded anything before making a ton of money and telling me I was crazy for not buying more hand over fist.
Maybe they were right - I did all my buying well under 10k, hell that would have been some great money buying at 10K and selling on the first pull back to say 15k.
But that is not how it usually works, because if I'm the type of person buying like crazy at 10k (after price almost doubled in a month) and then price goes to 15k then buy buy some more cause we are going to crack 20K!
Selling on The First Sign of Cracking
This is where people get in trouble. Everyone is an awesome investor when something is going up non-stop. What happens when it stops doing that?
Sadly, many don't want to admit it won't go up up up anymore and end up riding it down down down.
Now don't get me wrong, I held a chunk for the ride down myself. I wish I had sold more in the mid-teens. What saved me though is I didn't chase it on the way up.
Then this happened Chart:
Fast forward into 2018 and we all know what happened. Looking at it now it seems so obvious, but back then all we had was the first crack.
It was that big pullback into the 12ks and then a hard rally that failed well below the 20k high.
AND THAT WAS IT - It was the first time price failed to make a higher high since the move started. That was are little flare that we all wanted to believe was a shooting star instead.
The Point of This?
The point of all this is when everyone including your uber driver is telling you how they are killing it in bitcoin or some other investment - it's time to get the hell out of dodge because the fat lady is gonna sing!
It happened the turn of the century with the dot com bubble and then it happened again with crypto.
So just remember, the next investment that has been running hot and has your barber, uber driver and waiter bragging about how much money they're making - keep an eye out for the first crack and that sell signal.
Cat, Out!
Published by ScaredyCatGuide
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Ha ha... this was funny to read (for me)- about Uber and barber. A comparison I've heard so many times.
I sometimes drive for Uber. Not for money. Just because i Love driving, love to talk to people. Been doing this since 2015. Great way to run away from a PC for a change. For someone who has no obligation to work from 9 to 5 (i am retired)
I love shilling about cryptos. Always. Everywhere. My Uber pasangers included. I even kept a sign "Bitcoin accepted" for some time in my car. Few years back. (Took it away once BTC Tx fees skyrocketed to several USD's)
I keep promoting cryptos just as much in the bear markets, as i do in the bulls runs. And i have seen BEARS more than once. 4 or 5 times if to count em all. Back in the days we were mining satoshis with plain CPU, we simply had no market . True market. Then came MtGox. But even that was not bears. Just a scam n fraug from insiders.
And now? If we could only trully imagine and appreciate how much we are manipulated.
True bears may come in 2025. And true Bulls as well. Still long way to walk to mass adoption.
But this is all fine to me. I am here for a trully long run.
My first 6 years here - was just nice warm-up.
And i see a future world much better than today. All 100% connected and 100% decentralized.
I remember last year at holiday parties everyone was talking about it and asking questions. Plenty of college students looked to get it as the older guys were still hesitant. It will be interesting to hear their stories this Holiday season!
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True!
Sure it grew too fast and corrected horribly, but that makes it all the more appealing to buy now. That over-correction will re-correct and the market will rise again - just as the dot com companies did.
That's right! It's a matter of selecting a handful of solid coins with a use case and let the rest work out. Just like with the dot com bubble. You want to own some APPL, but you may also end up with some busts like pets.com
It's funny to me that people who were complaining to me that they didn't buy at 10K when we were at 15K refuse to buy now at $3,200. Smh lol.
Ha ha! Well said! It's pointless trying to time the bottom. Buy now. If it drops lower, buy again. If it drops lower still, buy more!
true that :D
I wish i could use this advice.
But, i don't believe in The US Federal Reserve Note.
The thing about bitcoin is that it is not a stock, a bond, or even an investment. It is a fiat-currency replacement.
And, at some point, it is going to replace fiat-currencies.
At some point The US$ will be only valued by collectors.
So, I will ride through all of the cracks and drops and pullbacks.
My best plans are to sell things for cryptos, to make more cryptos.
Next time I'm just going to make sure I actually short the downside instead of hodling. :)
I hear that bro!
If you can figure out the right levels to buy and sell at, you can make quite a bit of money at those highs. The problem is knowing what point to sell and buy at. It always seems to go up way too high too fast, then it pulls back, then goes back up to near where it peaked, then it crashes, goes back up a bit, crashes, back up, etc. If you're just gonna buy it and forget it, you better buy in early, and then you still better know when to sell.
Yes, there is a big difference between and investment and a trade.
Nice post. This is especially true with a new asset class. The .com bubble is a perfect example. It was new. Most didn’t understand what they were investing in. The bubble burst, and many lost a fortune. Finally people grasped what it was, allowing it to rebuild into the massive market it is today. I’m not sure we’ll see a crash like this in the crypto market again. I feel once it does recover, the market will be much healthier and sustainable. Doesn’t mean we won’t see healthy corrections, or even stagnation. but I’d be surprised to see a complete collapse like this again anytime in the near future. Still, your point is a good one...and people should be willing to take profit along the way in any market.
Yeah, basically it has looked very much like the dot com bubble....just happening even faster. People forget it took 5 years for the dot coms to recover.
The 200 day moving average, or moving monkey as some would call it lol, will keep you in the trend, and out of the way when things turn...it was so much clearer in crypto too...
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