Always take in consideration non of this information is financial advice or official announcement from any specific project, I’m no financial advisor, trader or expert, this is just my personal opinion on certain project mention on this article, cryptocurrencies are extreme high risk assets and you must do you own research, never follow what I or other people say on internet
HODL works until it doesnt - Bitcoin 20% Down in 1 day
1- Institutions are traders
2- Traders trade for profits no matter what
3- This is not charity, institutions will take profits
Dont get me wrong I do have a long term portfolio but this are just things you need to learn to stay alive on this market.
This post is a follow up to yesterday, Im not going to say that "I knew" price is was going to dump, this type of move is totally normal in crypto markets, although historically this kind of parabolic moves either you ride or die, we all can tell that Bitcoin will eventually keep going up IF history repeats again, it DOES NOT HAVE to go up and if you are new to crypto the "HODL" mentality works until it doesnt anymore, all those companies and ppl on Twitter that tells you to HODL for the long term is because they are most likely DUMP their coins on spot when the rally doesnt look sustainable anymore and thats essentially the $40k range, its not about indicators only anymore its about sentiment during a period of price discovery, greed and fear. If you like this space and eventually want to make money after loosing some then you need to understand this is normal, traders usually have more than oner portfolio, their long term portfolio where they do keep long term positions "HODL" and their swing or daily trade portfolio. Most traders make more money on spot just holding their position for long time but if you learn the art of trading technicall analisys then you can sometimes outperform the market and multiply your gains but this is not recommeded since its just too risky, instead you can just identify trends and look for price targets where you fee confortable to buy and a selling point that fill your expectations, no MOON SHOTS alloud.
If we take a look at the Daily chart we can identify a couple of dumps since $19k potentially at physicological levels
$19,490 dump (Almost All Time High)
$34,800 dump (Close to $35k)
$42,000 dump (Overextended $40k target)
It easier for me to go short than to go long and everyone has a different strategy but since I identify my weakness I have decided to stay out of futures when it comes to trade long, If I want to long I just go and buy on spot market and thats it, I have been out of trading since Xmas because going short was extremely risky and since going Long is not my forte decided to wait and it finally pay off, during this runs traditional indicators for me dont work that well, markets can stay bullish more time that what most ppl can stay short, in my case I use data from Glassnode and I dont even have to research that much since they are constantly putting data out on their Twitter account
https://twitter.com/glassnodealerts
https://twitter.com/glassnode
BITCOIN NUPL (Net Unrealized Profit/Loss)
NUPL (Net Unrealized Profit/Loss) specifically looks at the difference between Unrealized Profit and Unrealized Loss to determine whether the network as a whole is currently in a state of profit or loss.
Any value above zero indicates that the network is in a state of net profit, while values below zero indicate a state of net loss. In general, the further NUPL deviates from zero, the closer the market trends towards tops and bottoms. As such, NUPL can help investors identify when to take profit (blue) and when to re-enter (red).
This doesnt mean Bitcoin is going back down to $3k although if you take in consideration or even evaluate the posibility of this chart to be right most of the time there was a posibility the market would crash, I didnt short Bitcoin although did short ETHEREUM, I have become an Ethereum collector for the past year but in moments like this price move faster to the downside and altcoins do bleed more and faster than Bitcoin, by the time Bitcoin bleed -20% Ethereum gave an extra -7% for a total of -27% making my chances of almost getting the full move, I didnt because I never buy absolute bottoms and sell absolute tops nobody does that everytime, you could be lucky on a few trades but thats it although did make a substancial percentage on this trade. If we look at this chart it indicates how on January 2018 a similar situation happen, whenever the price goes into that green territory the bubble is about to pop.
Its better not to make money than loosing money
It took me time, sweat, tears and money to understand that patience is the key, making small percentages is better than making a ton one month to loose it all next month and I just a another human who cant fight FOMO, I cant have some USDT because I want to move it around it happens to everybody so during monets like this I just step away from trading, most of the time remain offline and just watch the fireworks, for the most part of late December I was just watching my long term portfolio MOON known it will crash but at least to a higher point than before.
Whats next for Bitcoin 2021?
We can see a lot of volume coming up, right after a 20% drop Bitcoin was bought almost instantly, for a few hours there was a fight trying to push BTC bellow $30k but it didnt happen, on the 4Hr Bitcoi finally hit oversold on the RSI since December 11, 2021.
Daily Chart, for the first time since December 16 its out of the overbought area and on the MACD its about to cross and the histogram may turn bit red for a continuation to the downside, this two doesnt necesarly means price needs to dump but are indicators that provides some evidence there is a chance it will continue to dump
Potential targets range
1- $35k to $29k (December Close)
2- $24k to $19k
Today I got into a few longs on ETHEREUM and THETA and I did buy some Bitcoin but decided to wait a little bit more to go deep, want to see who Asia reacts to this dump, got a Long position setup at $27k for a touch on the 50EMA, in the short term another -15% dump puts the price on the first range and I would feel more confortable to buy crypto, right now only have algos running on very safe settings getting prepare for any continuation of this dump, NEVER have hopes price will turn around in your favor because 90% of the time it wont, when you have hopes is when you are wrong.
If you already bought Bitcoin and dont trade then just hold it, if you have FIAT to buy just buy some dont sell the house, if you are not into Bitcoin at all buy some just dont YOLO, I mention yesterday that its better to buy a dip than buy a top even if it means buying higher.
Stay safe
.
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