Bear Market or Not
First of all, I'm sorry for having been away for quite a long time. I started a new job in the last few months and I had to slow down my crypto activity due to lack of time.
Let's take a look at the Bitcoin chart first :
A top was found at almost $69,000 on November 10, 2021. The bottom of this bull run was found at $28,754 on June 22, 2021. It is reasonable to think that as long as we have not made a new bottom, the hope of making a new top is allowed because a new bottom would be a very relevant confirmation that we are in a bear market.
Of course uncertainty is the strength of the markets. The fear of making the wrong trading decisions can be very stressful especially when you are new to trading.
There are several possible scenarios, but let's keep it simple :
Either the Bull Run continues and at least one new top will be found.
Either the Bear Market starts and in this case what can we do?
We can sell nothing and continue to hold. It is a reasonable decision, that the price of Bitcoin goes up or down, especially for very long-term investments
(a few years or more, such as waiting for the next Bull Run or the one after).
I think the price of Bitcoin can continue to rise during this month of April but I don't think a new top will be found. This Bull Run already lasted longer
than the previous ones. In addition, we are soon entering a period known by the expression: "sell in May and go away". I think this is the most likely scenario but I could be wrong.
As I had already mentioned in a previous post, I hold a good part of my bitcoins over the very long term (about 0.15 BTC) on different wallets.
I have about 0.1 BTC on Binance, including 0.04 BTC in staking which constitutes a small reserve available, so I don't need to transfer additional funds if needed on the exchange. So I have 0.06 BTC left that I can use for my trading.
After the last Bitcoin drop in January, I had put sell orders between $42,000 and $62,000 amounting to $100 and $200 per order for a total of just under 0.03 BTC.
I keep trading funds available as the Bull Run may continue and the Bitcoin price may continue to rise. And opportunities on Bitcoin/Altcoin pairs can also be interesting.
As I mentioned in my first posts, most of my bitcoin comes from the faucets and ptcs I've been doing since 2017, plus I don't need to convert my cryptos to FIAT to live. So even if I'm wrong and Bitcoin just goes up and never goes back below $42,000, which seems unlikely to me, I couldn't really feel like a loser. Certainly I would not buy btc with what I have already sold but I would have funds in BUSD available for other crypto opportunities. And a lot can still happen between now and the next halving in 2024.
Managing your risk well means better managing your emotions to avoid situations that are too stressful. I chose this action plan because it suits me in relation to my current situation, my projects, my personality.
In no way is this example of my Bitcoin portfolio management (I won't talk about my altcoins) an incentive to sell. I just wanted to give a fairly concrete example for people just starting out. I invite you to build the action plan that suits you, while carefully measuring the risks you are ready to take.
We must not forget that we can lose everything and very quickly. Patience and calm are our weapons against market volatility.
Let’s go back once again to the Bitcoin chart :
It is true that the price of Bitcoin has never fallen below the top of the previous Bull Run, but it is also true that in Bear Market, Bitcoin has also always made downward corrections greater than 80%. One must be careful and not have the belief or certainty that the price of Bitcoin will never drop below $30,000 or $20,000.
It is also likely that the bull run in the financial markets will end soon (perhaps at the end of the year or next year). There were new market tops, for example the CAC 40 Index, the S&P500 Index, the Nasdaq 100 Index.
CAC 40 Index :
S&P500 Index :
Nasdaq 100 Index :
Unprecedented events mark human history. We can try to think of examples from the past to better understand the future, but the future will always remain uncertain.
This is not investment advice. And the possibility that I'm wrong is also to be taken into account.
The crypto market is young, volatility is high, do your own research and measure the risks before making a decision.
Thanks for reading my post and happy earnings :)