Hello guys, and welcome to this second episode where I am talking about a topic that has raised a lot of voices and a lot of opinions which is whether or not holding coins blindly is a wise thing to do given the crazy gains of cryptocurrencies volatility in the past ,so in the last episode I have tried to illustrate how the current market state is different from how it was one year ago and how you can gain from every upward movement or downward movement without getting yourself exposed to the market for a long period of time. For all of this details and more check out the link of the previous episode :
https://steemit.com/cryptocurrency/@ismailkah/why-hodling-is-bad-for-your-health
In today’s episode I’m going to talk about a practice that we heard of all the times and had become like a symbol or a secret formula to getting rich with cryptos and I am referring to the BTFD or “Buy the dip”.
Basically, buying the dip means buying assets mainly bitcoin and altcoins whenever they crash in price .
Well, just to make something clear the general purpose behind my articles is to incite you to go out there and learn more about how the market works and stop taking actions blindly just because some so-called experts are advising you to do.
Since the middle of July until late December of last year we had witnessed one of the most aggressive bull runs in history of the cryptocurrency market that lasted for a 150 days approximately driving the price of bitcoin from 1800$ to 19200$ and the total market capitalization from 70 Bn$ to 620 Bn$ with some dips of course as shown in the above graph .now, this is where the whole “buy the dip” ideology had started because it would have been effective if you had accumulated more of your positions every time the market had suffered from a dip(yellow arrows).
On the other hand, let’s have a look at the current market state from December up until now: it would have been a disaster if you bought a position every time the market had dipped and you would find yourself not only hanging with a losing position but also you would have less fiat to follow the market whenever there is an opportunity (consecutive daily green candles).
Accordingly, I am going to show you how you can wisely deal with the cryptocurrency market and how you can cross your way to be a better trader :
1.first of all, we need to choose carefully the people we follow either on twitter or YouTube or any other social media because one way or another the way we think and the way we handle our trades is directly affected by those that we listen to. well, I am not going to throw some names but what I will advise to do is to look for influencers with a background of trading in traditional markets because after all the crypto market is still in its early stages and the majority of those who made some crazy gains in the past are not necessarily experts but they are telling you what to do either way, well I’m sorry to break it down for you but their strategy of the past is now worthless for all the reasons above even if we saw a similar bull run in the future ,if you become a better trader you will benefit more and you will learn how you can secure your gains and get the hell out of the market when you should instead of holding blindly.
2.This terminology of ‘Buy the dip’ does not necessarily exists in traditional markets .in fact, we only refer to retracement because retracement are a powerful way to enter a given trend if you had skipped the first wave, retracements are generally determined by Fibonacci retracements and whenever a retracements had surpassed a 100% of the initial wave. Well that’s a reversal my friend and this what the majority of crypto investors fail to understand because in this case it is not a “dip” anymore, but that’s a different trend that you are going to counter-trade it if you bought a position .
3.As I mentioned in the previous episode, the crypto market now can be played both ways so it is wiser to follow the market and to write down a clear strategy that involves many scenarios the bullish ones and the bearish ones and don’t rely upon hope and luck because this is called gambling and that’s not what we do here my friend, trading is all about disciplined and planned steps and always have a plan B because if great traders have a winning ratio of 60% trust me you’re going to lose more than you will win so go out there and learn about risk management and how you can reduce your losses.
I hope I was with some help into picturing the reality of this market because after all ,we are all here to learn and trading require acquiring new skills regularly and to not stick with the same strategies and approaches .
Until the next episode.
Happy trading 👍
I bought the last dip. Dont have money to spend on the current one but Im not loosing sleep due to the market.
Well,others might have
Actually, its good to buy the dips if you have a strong mind of just filling your bags with some coins to make it look heavy☺ not to quickly dump it once it get a little sharp rise.
This is mostly what majority are doing and its gonna burn your heart.
Only buy a coin to be part of the network rather than buy to be part of the gainers (which in most cases, will end up being the loser because of the tyrant whales in the market before you).
A simple advice.
Buy whatever coin you felt is at the dip now, lock them up, and get your mind off it, do your regukar activities, quit being a full time crypto spy and learn to endure even in the hardest temptation. Always remeber, tomorrow is another day, put on a big smile, and say to yourself, "even if bitcoin is dying, what more should i expect of it when all things gonna die"😉.
PS: bitcoin will hit the lowest mark you can ever believe this year and wont ever rise until mid 2019.
That is also a strategy to consider and about your hint one thing i know for sure is that no one can give an exact prediction for the long term given the fact that there is a lot of parameters the fundamentals ones and the technicals ones
It is very dangerous to buy the dips, by thinking that we will get a bounce in price, since 4-5 months crypto market is going in only one direction, that is DOWN. I think one should wait till we get a considerable up-move in price and stay there.
It is okay to miss a little upmove in prices, it does not worth of taking risk at this moment, Stay safe all traders and investors.
That is exactly what i'm trying to enlighten people about
Thanks for sharing your thoughts. Buy the dip is all fine and well but only if you remember to sell the tops ;)
Well,it is not as easy as it sounds .isn't it?
so many dips, when your not sure where the bottom is
yeah that's like trying to catch a falling knife
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