I was just speaking with a friend of mine about current investments in crypto and stocks. And one move that I made was to sell my shares in Bloom Energy (BE) and switch the returns into Netflix (NFLX). But what's important about it is for me selling under the psychological threshold price. Bloom energy was heading towards the $300 mark, while I have entered the position on it at $198. In my mind I wanted to sell at a round number which was $300, but have decided to lower it at $298 thinking that a profit of $100 per share is good enough. But even by doing that the price would move close to it. So the last move was to lower my selling point to $295 which was matched on the market and the order was executed.
Days after I have made the sell, rechecking the price of Bloom Energy (BE) on NASDAQ I saw that it was trading around $270. This showed me that when there is a strong wind and a stock moves high in a short period of time, it is better to take profit. And taking profits has greater chances of success if you lower the barrier under the psychological threshold price. This applies in both stocks, crypto or any other financial domains where you want to exit the market at a specific price point.
Looking back I remember the previous bull cycle where I've set the goal of selling Ethereum only if it reaches $5,000. And while it missed that by a couple of dollars, as probably the $5k was a psychological threshold for it which was not reached, I ended up not selling and not taking any profits. I don't plan to do the same mistake in the next bull run, but cannot but wonder if 5K will be the barrier or if there is another in upstream. Many "analysts" say that ETH will go much more and probably I will be influenced by that as well, but first I will have to watch the market how it evolves. I hope not to miss taking profits again on Ethereum as I am holding some since 2017 and I've got tired of being left behind.
But I think in all this time I have learned my lesson and my latest move in stocks proves it. Not only that I have succeeded to sell for a nice profit, but I did it before the trend was reversed for the involved asset. And it is not the case that I wasn't trusting the asset to do better, but taking profits it is much better. By doing that allowed me to switch to another asset that I was tracking (Netflix) at a low price point, on which I am already +5% ROI. That's not a huge move and I know that the entertainment domain doesn't experience huge swings, but if it goes over 20% probably I will exit the market again and pick another asset to ride. What I discovered from all these experience is that taking profits is an amazing feeling, even if you don't do it at the peak.