— Jesse Lauriston Livermore
Most of the principles that work in the stock market also apply to crypto, if you ask me. The only thing that sets us apart from the stock market is "degeneracy." We are a breed of our own in here...
A few years ago, I wrote a post titled "The Gambler's Mentality," where I explained how many so-called crypto investors were missing out on generational wealth and ruining their portfolios by adopting the mentality of a casino player in investing in crypto, rather than studying cycles, halving patterns, and TA to make the most out of this asset class.
The gambler mentality is still alive and well. I personally know of a few cases where people are still making the same mistakes over and over, but on a relatively small scale compared to the "degenerate traders" like this guy called @MiyaHedge on Twitter, who managed to lose $12 million in one day on Binance futures.
He wanted to be the no.1 Binance trader but ended up broke... Imagine how much crypto he could have bought on spot and how much money he could have made in this bull market. In case you were wondering, the bull market is still in play, despite retail acting like it's a bear market or something.
The fear and greed index for Bitcoin is at 30 points, indicating fear, Bitcoin search on Google trends is bottoming out, and BTC.D looks to be falling off a cliff soon. Nothing is obvious, though. In the case of this degenerate trader I just mentioned, it was obvious that ETH would fly yesterday when BTC looked to be forming a bottom around $61,000, but that wasn't the case.
It got nuked, taking the whole market with it, and so did the account of this Switzerland-based trader. Nothing is obvious in this market, aside from the fact that we are two months after the halving, and it usually takes about a year for BTC to top out after the halving is in.
What's also pretty obvious to me is that no bull market so far has ended in pessimism. On the contrary, the euphoria has always been the indicator showing us that the bull market is near its end. I have not seen that yet among crypto participants.
You know what else is obvious to me? If just a couple of months ago, you were regretting not buying more crypto during the bear market, what the heck are you doing now not loading up on these discounts? I know, you're probably waiting for $40K BTC... Good luck with that!!!
You become average when you're distracted by everything and committed to nothing. This is the case for most of the crypto market participants who refuse to have a macro vision of their holdings and instead get lost in details and day-to-day swings.
Yesterday's FUD was caused by Mt. Gox's announcement of starting to repay investors as of July. If I had a dollar for every time I heard that. Such news caused the dump of more BTC in just a few hours than what Mt. Gox is supposed to repay over the course of a few months. Same shit every cycle.
There are many factors influencing price swings, and nothing is obvious, but we sometimes forget about that and act as if we know exactly what BTC is going to do next. We don't... Hence, it's better to chill on spot and trade the bigger waves than getting drowned with toilet water on leverage trading.
What do you think?
Thanks for your attention,
Adrian