Are You Disappointed With Cryptocurrency Market?
Keep calm. It’s not personal
Lisa has bought her first Bitcoin during its ATH at 60k. She expected the asset to go up, and it did at 62k.
After a few weeks, it rallied down. She said to herself, ‘this can’t be happening. This doesn’t seem right.’ Then before she could even finish her thinking, it went further down to 29k.
She cried at night. She couldn’t sleep. This was her first investment. She was told by her friends to buy Bitcoin.
The next day, she sold all her Bitcoin at the price of 30k with a 50% loss.
As soon as she sold it, the Bitcoin price went up to 32k.
Ever feel like Lisa? Is she right with selling all her Bitcoin?
What’s wrong with this scenario?
Mom, I want to introduce you to Mr. Market — my boyfriend
Some traders personalized the market and viewed the market as a person. They start to think that they have a relationship — a special bond. If the market trend goes up, they feel giddy inside. In their head, they started thinking about what they’re going to buy with their investment. They think about Lambos, big houses andsleeping in a bed full of cash.
If the market trend goes down, they feel betrayed. They feel cheated. They feel sick to their stomach. There are times that they would wake up physically sick.
It became too personal.
On Dec 18, 2013, the term HODL was born.
GameKyuubi posted this on a cryptocurrency forum called ‘Bitcointalk.’ Here, he mentioned that ‘he is a bad trader for holding Bitcoin.’ However, he did not mention why he bought Bitcoin the first time and why he’s trading Bitcoin. At that time, he probably had drowned himself drinking whisky.
During that time, the price of one Bitcoin was 744 USD.
Step back and analyze what’s wrong
We, traders, act as the market owes us something because we gave them our time and money and that the market should reciprocate back to us.
Some traders feel that even if we have the perfect indicator - everything will be smooth sailing. When anything goes wrong, they jump to the conclusion that the market is out to get them.
The market DOESN’T KNOW YOU.
The market is not HUMAN. As a result, the market action doesn’t always match our expectations.
Just stay FOCUS
The reason why you should enter cryptocurrency is to focus on your strategy:
When that strategy tells you to buy, then enter.
When that strategy tells you to sell, then exit.
Keep it simple. Have one to max two chart indicators only.
Have a stop loss in between. No strategy is 100% effective.
If you plan to be an investor, just HODL. Don’t look at the charts all the time.
For technical analysis, here is an example:
In figure 1 of BTC/USDT pair, we have only used one strategy for buying near support and selling at the resistance. The best indicator to used is FIBONNACI RETRACEMENT.
As per (yellow) arrow we can see that the strong support is at 32,715.77 USD and a strong resistance is at 40,000 USD.
We can identify this as follows:
- During this time, the perfect entry would be around 32,000 to 32,715 USD
- Exit would be around 40,000 USD
- We can also see that during this time, the price is on accumulation first. We can either buy when it breaks the resistance or buy at the support.
If you have frustration on the market, it’s important to disarm it. The market is compromised of traders/investors who buy and sell at their pace.
If you plan to invest, STUDY. But, please don’t enter the market because everyone is talking about it.
Before you invest, learn the purpose of the blockchain and the coins. Study the history of Bitcoin and the altcoins, then analyze the market movement. Don’t invest in something that you don’t know. Begin with the fundamental analysis, then go technical. Practice virtual trading first, then move on to real-time when you know how to handle it.
If you cannot handle the volatility, then stay away from it.
Where’s Mr. Kyubi now? Probably in his own yacht, still drowning himself in drinking whisky. LOL
The asset mentioned above is not financial advice, and this post is for educational/entertainment purposes only. However, if this guide has helped you towards becoming a profitable trader, please ‘clap’ below so others will see this post.