Updated: Apr 30
It's a great time right NOW to invest in the crypto market at large. Bitcoin is getting ready to top out but before that happens, it's likely to drop down around 50k.
UPDATE: Well I was right about this on 3/28/21 I think we could see an even lower BTC at this point as its losing Dominance in the market and seemingly ending its bull run.
How could anyone anticipate this? Market cycles.
Everything, whether it's the stock market, Planets, human beings, even crypto, exists and move in cycles. One main thing to look for in the stock market and the crypto market, in particular, is Moving Averages. Typically, you want to watch for 21-day moving averages and 51-day moving averages. There are even smaller time frame moving averages to look out for if you're trading daily but for the long term, these are the main ones. If you go back even further in an asset's history though, you can anticipate what the market is likely to do, in the case of BTC we have a long history to look back at.
Now, something to keep in mind here with market cycles; when there's an end to a market cycle and assets become weak, you want cash! The main point here is that you want to understand the market you are in and anticipate when it's going to shift. Basically what this helps you do is buy low and sell high, pretty much what every investor or trader hopes will happen... but, it is statistically very likely that you will not be able to time it perfectly. This is very important to realize however as you can still get close!
The main thing to watch for within yourself is your FEAR / GREED ratio.
This helps you stay impartial and helps you make decisions without emotion involved. Basically, this allows you to stick to whatever your plan is even if BTC dips 3% and you become Fearful, you still hold because you know, based on cycles, that its just a temporary adjustment. In the event of a Greed scenario, like BTC gaining up to 6 figures, you might want to keep holding your entire portfolio because emotionally, you feel really good and you're super hype... instead of trimming your position to secure profit, you could lose a lot. This isn't always the way this goes, but if you know what cycle you're in, you are more likely to make the better decision. In this way, statistically, even if you're right half the time and wrong half the time, you will still be profitable.
A big deal recently with BTC (and for the entire crypto market at large) is Tesla announcing that they are now accepting BTC for payment! BTC for cars... pretty crazy and very big news for the fiat system we exist in. What's even more impactful with Elon's announcement for Tesla is that: "Bitcoin paid to Tesla will be retained as Bitcoin, not converted to fiat currency." Elon will not be converting BTC to dollars! What does he know that we don't? Actually many people hold the sentiment that cryptocurrency is the future and that fiat currency is ending its reign.
Now, this doesn't mean cash is dead, not at all, but it's something that many people are giving up on and buying into crypto as their main investment. Although I believe BTC is an incredible long-term investment, I don't think you should put all your eggs in one basket, and I especially don't believe the dollar is dead. People need to realize, and you would if you looked back in history, that market cycles end... and when this happens, you want cash for stability and/or the next asset that is getting ready to move.
Something extremely important to keep in mind is what has occurred throughout history, particularly, what happens when market cycles end. Let's take a look at the situation of the Great Depression. The Great Depression didn't start when things were bad, it happened suddenly when things were great!
All of a sudden the Great Depression happened when people thought stock prices could only go up. Everybody thought they could be a winner in the stock market. A huge amount of retail investors showed up and lost big time... Its a very similar situation we are in right now. The amount of interest in day trading right now is crazy and not everyone understands the concept of market cycles. Same thing we saw before the Great Depression. Its important to know that over 99% of day traders lose money.
I'm not saying we are at the top of the Stock Market or the top of the Crypto Market, but its getting close and I want people to have the information they need to make the important decisions when the time comes. Dont go along with the herd. With that out of the way, here are some tools and resources I use that can help you position yourself in an educated way in the crypto market.
I am extremely bullish on the Altcoin market. BTC isn't the only coin to invest in, ALT coins have been extremely volatile with some moving over 4,000% in the last year, (take a look at STORJ coin). Altcoins (anything other than BTC generally speaking) move in conjunction with BTC and the time is coming very soon where we see ALT coins go parabolic! We are about to see BTC end its bull run, in other words, end its cycle of moving up, as this happens the ALT coin market will make incredible gains upwards. With this information, it's also important to understand it's incredibly unlikely that you will buy at the absolute bottom or sell at the absolute top.
Obligatory Dogecoin price
Before you do anything, sign up to a crypto exchange!
*It can take some time to verify your identity so you're able to deposit money into your account. I recommend getting that setup as soon as you possibly can, even if you're not ready to put money in to your account.
Exchanges/Wallets I Like:
A solid, albeit boring exchange that I trust and feel is really simple to use. They have a solid lineup of coins but not as many Altcoins as I'd like. They do however have the ability to connect an API to make rebalancing your portfolio super simple. I recommend a solid API below
KuCoin quiet-frankly blows my mind! They have a ton of solid Altcoins and actually have a trading bot built in to their app that lets you automate trades! It has a higher learning curve as you can do so much with it but dont let that scare you from setting up an account. The main attraction here for me is the wide selection of Altcoins available and you can also connect an API to further automate things.
Uphold is a solid wallet/exchange that you can connect to Brave browser and its just super basic and simple to use. The fees, however, are higher than BinanceUS and KuCoin I believe but its still worth using.
I have another secret that you should definitely capitalize on:
Brave is an incredible browser that automatically blocks ads and trackers that saves you bandwidth and time while browsing the internet. The part about it is you can directly connect your crypto wallets to it and if you turn on "Brave ads" you can earn BAT (Basic Attention Token) for free! I feel they are revolutionizing advertisements on the internet with this. Another cool aspect to this is creators such as myself can connect "Brave Rewards" to websites like this one to making it super easy for people to donate BAT to creators they value. I love it and as I am writing this BAT is worth $1.44
Now that I feel like I was able to get my general point of view across, its time to share my resources.
First up Live Coin Watch
I've been using Live Coin Watch for short-term trades. It's a great resource for short to long-term information on coin prices and the percentage increases. You can favorite coins that you like and whatever you have available on your brokerage to keep track and see where things are going. They have some information about the projects and the Twitter account associated. Really cool
Next up is Shrimpy
Shrimpy is an API that you can connect with your brokerage account to easily and simply rebalance your portfolio. You can even follow other people's trades, probably the coolest feature!
You can see other people's performance from 1 day - 1 week - 1 month and decide if you'd like to follow them. They have chats too so you can talk to the people you follow. The professional account is $19 a month which seems a little pricey but when you compare that to what you can make by using it, it's pretty affordable. My favorite leader is the Trex, actually hilarious and doing really well if you look at the 1 month performance. The link for Shrimpy is my referral and you can follow me if you want. I share my thoughts and have links to a Discord channel where you can get even more resources.
Another resource I'd like to add is the daily videos from two Youtubers, Blockchain Backer and Tyler S.
Both are incredibly well-researched guys and while they don't have the same opinions, they actually complement each other in their technical analysis. Tyler S is hilarious, something people don't always appreciate but he brings some of the best TA I have ever seen. Blockchain Backer has been in the market since 2019 and really knows his stuff when it comes to market cycles and analysis in general. Both have classes I would recommend to anyone, they are both extremely affordable. I'll link their accounts below.
Tyler actually has a competition going on at the moment to win 5 Ethereum which is valued right now at $8,495 Check out his Youtube for the link to enter.
Twitter is next on the list
Twitter is a great resource when it comes to research. A simple search of any topic brings up a list of people talking about it and you can judge from there if you want to follow or not. Lots of great discussions and the two YouTubers I listed have accounts worth following. I use Twitter mostly for stock market research but it's worth mentioning.
Last but definitely not least: Discord
Download and set up Discord if you don't already have it. There are many servers out there to join and some have educational resources as well as general chat where you can interact with people already involved in trading. The server linked is called Listen Like Thieves, in it you will find books and videos to check out relating to crypto and the stock market, as well as Bots that have commands you can use to easily see different stats related to crypto or the stock market. Really great resource to use.
I hope you enjoyed this blog post and that at least one thing listed here was helpful to you. I am not a financial advisor so please make sure you do your own due diligence in all these matters. Take care