The longer you are in the cryptocurrency market, the more trends you begin to notice. That there are 4 cycles that are roughly split evenly between bull and bear cycles. That during the bull cycles people in the market will always claim that this time is different. That we won’t see a blow-off-the-top moment, and go through a cold bear market. But, so far in crypto’s young history, this rhyme repeats every single time. There is always a big thing in the market that begins the stampede toward crypto, only to slowly disappear.
Not only do you notice the trends in crypto the longer you have been in the market, but you will also easily notice the mistakes that people continue to make time after time.
Over the years there is one mistake that I have seen people make the most often. And it would end up costing them a fortune. This common mistake is people becoming impatient and chasing gains.
Let me explain this in more detail. Let’s say there is one cryptocurrency that you are very passionate about. You have put in the research and came to the conclusion it has a very bright future. Therefore you have been accumulating building a position for over a year. You are convinced that it will soon take off, and the price will soar. Unfortunately, since you have begun accumulating this coin the price has done next to nothing. Only moving sideways and even dropping a bit.
However, a year has now passed and your patience has begun to run thin. A different coin that you’re not a fan of has just exploded upwards in value. It is the talk of the market. It is up 500x in the last week. You begin to feel jealous that everyone is making profits with this other coin, while you are sitting here with your favorite crypto that has been losing you money.
And so you decide to convert this position into the hyped coin of the week. As soon as you do that, the price begins dropping and is suddenly down 30–40%. What many people don’t realize is that when the market begins going crazy over certain crypto and it has gone up significantly in value. That usually means the pump in price is already nearing the finish line. You are about to become someone else’s exit liquidity.
To make matters worse, soon after you sold your favorite crypto, that too begins to pump. You bought a coin that was finished appreciating in value and sold your own prematurely. A lose-lose scenario.
One of the most frustrating parts about the cryptocurrency market, also makes it the easiest to make money with. Bitcoin and Ethereum are the magnets that control the entire market. When they pump, altcoins will soar even more. They almost always rise in tandem. The cryptocurrency market is too young, and individual projects usually don’t move on their own merit yet. It can be frustrating to see projects that have no merit or value pumping alongside something like Bitcoin.
But this also means you should never panic, become impatient and trade into another crypto that is pumping. By chasing gains, you will only end up losing. There is no worse feeling than watching the coin that you were very passionate about and discovered early. Only to see it finally pump after you sold from being too impatient.
To be successful in this market, all you need to do is have patience and survive the cycles. If you can do that, you will have great success.
How about you? Which cryptocurrencies did you sell too early?
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