As an investor as well as a trader, the main focus is on the profit you can make. The higher, the better but in order to get the maximum, you have to know when to enter and when to exit. TA can help you a lot and you can also learn from those who have more experience.
Ever since the May drop happened, I was watching legends sharing their theory on different platforms. I'm pretty new to this, so learning as much as possible is my number one priority, therefore it's essential to learn from the best, but who's the best?
You can decide who to learn from just by watching if what they say confirms. Every trader has a different strategy, so watching charts with different indicators can be confusing, but what counts is the results.
When the May drop happened, there were people saying BTC could go even lower, could revisit the $18k - $20k area as there's a lot of liquidity there to be captured. BTC bottomed out at around $29k back then, which was already a 55% discount, so buying at $29k when you know it came down from $64k is priceless.
As a trader, you watch the charts, apply the tools you think work best, calculate your R/R ratio and make a decision. Short or long, if you know what you're doing, you can make profits. As an investor, you wait for you entry, buy, then hodl till it's time to sell. So if you know you can spare another $10k/BTC (in case it goes to $20k) it's something to consider.
My funds are limited, I don't have $10k - $20k to set aside in case BTC hits $20k, so I had to decide what to do. Finally I decided to listen to myself, buy the dip at around $30k as I could not lose that opportunity and then see what happens.
Long story short, BTC has reached the $52k area as predicted, after which the next dip should have happened, down to the $20k area. Instead, BTC started to write new ATHs, one after the other.
When the first new ATH has happened, people started shorting, expecting to close their short position as low as possible, but BTC had other plans. It dipped to $58k or so after which the only way was up. The smart ones closed their position with a small profit. Some have admitted publicly they were wrong, while others said nothing.
By now we know this cycle is not like the previous two. This means you can use your TA tools to predict what's going to happen and follow the plan, till the market invalidated your theory.
This is not an exact science, you can never know for sure what's going to happen. We see orders not being executed as miss the target by a few cents or dollars, we see fakeouts, shakeouts more often now.
Crypto is going mainstream and as institutions are involved as well, the stakes are high. Those who have the necessary funds will do everything to shake you out of the market, to close your positions in order to get what they want.
Trusting someone blindly just because they have decades of experience in trading is not exactly a good idea. I am glad I have chosen to listen to my gut. Imagine me still sitting in cash while watching BTC do more than 2x and alts as well. I don't even what to imagine.
So, what's the biggest lesson I've learned? Making a decision is always your responsibility. You're the only one who can decide what's right or wrong as you're also the one making the profit or taking the loss. No one can know exactly what's going to happen as the market moves its own way. Make your own decision and learn to live with it. Also, follow your favorite legends to see if they are willing to admit things did not work out as planned. Those who only shine when things are going well are not the ones you want to learn from. No one has a 100% success rate.
