All last year I was writing about how Crypto was going to the moon and it proceeded to do so and in the last few weeks I’ve been writing about how it has peeked and will fall back to earth and it is in the process of doing so. I hope these columns have been helpful for the profits these last year have presented.
Now what?
I believe we will see bitcoin under $20,000 and Ethereum under $1000 and as I write Ethereum has just dropped below $2000.
So how should be invest or trade in Crypto.
Firstly, trading anything is tricky and you really need to sit in front of the screen all day long waiting for opportunities. Trading is close to gambling especially when the volatility of Crypto is so huge that swings can go a long way in each direction. Im not trading this so I guess I shouldn’t express an opinion, but as Im a bear I’d be selling the rallies. Swing trading this is also a great opportunity… untill it legs down and you get crushed long. Such is the traders life.
Investing on the other hand has clear strategies, if and only if you think Crypto has a great tuure. (I do)
Mine first:
Stay away till the crash is over and then acquire Bitcoin untill the next halvening and the consequent vertical rally. Im expecting to be able to buy between $10,000 and $20,000 but it could be lower but I’ll be fine to average below $20,000 because the next run will go to $100,000… at least in my thesis.
Dollar cost average. This means you simply keep buying bits and Bobs of Bitcoin right now, tomorrow, next week, forever. You simply don’t care about the price to day, you buy regularly and forget trying to time the market. It is literally a dumb strategy, but it actually works well if the market you are DCA’ing is going up in the long term.
Max out the Crypto cycle.
First there is the Crypto winter. Acquire Bitcoin with pinches of any major that gets stupidly cheap
So my model of Bitcoins progress is the chart of Ririble on the basis it is a fast horse without the momentum of Bitcoin. A month ago I posted the Bitcoin and Rarible chart as follows:
Rarible
I expect this ‘canary in a coal mine’ chart to continue to hold and right now its:
This is kind of how I see the Bitcoin bottom looking, followed but a fair amount of bobbling along the bottom afterwards. This was 2017 and I also think that’s a fairly good guide to how things will pan out.
Its not a pretty prospect if you hold but if you plan to buy the bottom for the next boom/bubble it’s a mouth watering prospect.
Watch out for new developments, like DeFi last year and NFT this year. Buy pinches of the initial pioneers. (If its not a new crypto segment discuss at conferences or funded by silic0n valley VC giants, don’t bother)
Ride Bitcoin up then sell down some to jump into Defi/NTF majors.
Then sell down big wins to jump into second tier Currencies that haven’t boomed yet.
Sell out entirely when the new geniuses are singing Bitcoin to $1,000,000 and the noise of stupidity explodes. Better to cry all the way to the bank because you missed the top, than be crushed on the other side of the bubble.