Warning a massive amount of thumbsucking and generalising ahead.
I've been in cryptocurrency since 2016, it's not that long in human years, but in HODL years, it's a lifetime of experience. I've gone through a full bear and bull and bear run, so I'd like to think I am more prepared than before. I'd also like to think I am better equipped than many traders in this market for the first time.
Over the last 5 years, I've won and lost money in fiat terms like you wouldn't believe. Stomaching losses of 80% is always harder when the unit number in fiat is larger.
After these past few years, I've become desensitized and less emotive; I have learned a lot and am more systematic in buying and positioning.
Do I take a flyer on a shit coin here and there? Absolutely, but this is well within my risk-reward ratio, which I refuse to break. I preach Bitcoin, but I am no maxi; I think it is still the best version of cryptocurrency to date, but I am not opposed to seeing what else is out there and scoring me more BTC in the future.
Perhaps I'm a Semi-maxi, lol, if there's such a thing!
Looking at the data
We've been enjoying quite the bull run from the BTC floor of $3000 after the crash down from $20 000, and man, what an amazing ride it's been since the halving. If we overlay the previous halvings date ranges and look at BTC on-chain data of how many wallets are pulling into cold storage, it's still very bullish.
So I am going to assume that if that doesn't revert, that we're halfway through the bull run. The problem with being halfway is the second half is exponentially more violent in its dips and rips. If it plays out as it has previously, we will eventually have an altcoin season that will mint more millionaires than ever before.
This part of the bull run is where you need to keep your greed in check and try to roll out of positions as best you can without spooking the market and enjoy some of those profits.
Beginners luck or do I suck?
One of my personal key indicators of a frothy market is who is buying. I am starting to see many crypto haters starting to get in; the gains are too good, and people think it will continue like this forever and FOMO in. As one friend makes gains, so it provides social proof that you can do it too. Suckering in a host of unsophisticated retail investors who buy and sell at the spot price.
I've had people who I would never imagine ask me about crypto, and they're buying in on all sorts of coins without knowing the risk they are taking. Some have even outperformed my trades, and I'm supposed to be the one taking this thing seriously lol, man wtf am I doing with my life?
Remember I mentioned coins are still getting clawed off exchanges? As retail gets in, they tend not to move off exchanges, and as that builds up, I will start to worry.
As soon as that reverts and speculators start to hold bags ready to dump, then I think we'll start to turn net sellers, but for now, exchange liquidity continues to drain.
Unit bias buyers are taking aim
Bitcoin has become a serious mans buy, you can see it in how quickly the dips are gobbled up, and as the price keeps moving up, people feel "priced out" of Bitcoin. This is where altcoins thrive; the unit bias kicks in; we can already see that with shitcoins like XRP and Doge getting pumped 500% and 22 000% in the last year. If a coin is close to a dollar, under $10, people will buy the fuck out of it.
Since no one gives a shit about issuance rate, market cap, circulating supply, all they see is the unit price as a factor on if it's cheap or expensive. You're going to see over the next few months anything under $10 get pumped the sky-high.
People will feel priced out of Bitcoin, Ethereum, and even BNB as it crosses the $1 000, and the low-value altcoins will be where all the speculation drives.
Institutions will continue to pick up Bitcoin and ETH, and this pressure will force retail into more unit bias trades. As these unit bias trades move up, it provides a positive reinforcement loop that can continue running for some time.
If you don't believe that the market is that stupid and people will figure out something is overpriced, then you only have to look as far as Tesla. They did a stock split, and as soon as the new share price was seen as lower in fiat terms, people gobbled it up even though the stock was considerably overbought before the stock split.
The unit bias bull market is starting to pick up, so hold on to your coins this is going to be a hell of a year.
Have your say
What do you good people of HIVE think?
So have at it, my Jessies! If you don't have something to comment, "I am a Jessie."
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