Over time, Bitcoin just goes up which makes trying to trade it very risky

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Everyone is trying to time a top or look for a high point to sell, but if you zoom out, hodling tends to work pretty well

Ever since bitcoin was created it was gone from the lower left to the upper right.

Sometimes it is easy to forget that watching it run up to $1k then crash down to $200, or run up to $20k and have watch it crash back down to $4k, but if you zoom out enough, it's pretty clear what is going on here.

Bitcoin has self imposed supply crunches every 4 years that send the price skyward, and it's worked the same every time thus far.

Bitcoin has had 3 halvings and the price has clearly reacted to these halvings, it's never been more clear than in one simple chart.

Check out the chart below showing bitcoin's price with the halving dates labeled there in red.

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(Source: https://www.swanbitcoin.com/why-bitcoin-is-not-a-ponzi-scheme-point-by-point/)

When you look at a chart like that it's pretty clear that bitcoin tends to mostly just go higher and higher and higher.

Plus you can see that there is a trend for the gains to really accelerate in the year following a halving, which is right where we are right now.

Trying to trade Bitcoin can be a fool's errand

I've already lost some of my bitcoin trying to time rips and get back in on dips during this move.

For example, once we broke through $20k and got to the $22k-$23k area and started to slow down, I took some BTC off the table thinking we would get a retest of $20k.

At this point there has been no retest of $20k, and it's gone more or less straight up to $42k with one major pullback down to $30k.

I was forced to buy back in on that pullback, which was ironically still 30% higher than where I sold some, ugh.

There will come a time when taking profits makes sense, but keep in mind that whenever you take profits its very possible you end up missing out to the upside.

For example, I was trying to time a 15% pullback, and missed out on a 100% move with the btc that I had sold.

Doesn't sound like a very smart trading/investing strategy when you break it down like that.

Past patterns point to this thing going well over $100k and it happening towards the end of this year.

There is no guarantee that things play out exactly in the same fashion, but the good news is that if you look at history, there is a very good chance the price will be higher if you hold it long enough.

So you missed the run up to $1k the first time around, well, several years and halving cycles later and it's trading for $40k.

I think those people are glad they didn't sell at $1k.

Anyways, just some rambling thoughts on not being in too big of a hurry to sell during a bull market.

Based on a couple recent patterns I've posted the fun really hasn't even begun yet.

Imagine selling at $40k and watching it go to $250k before this year ends... because that is pretty much what past patterns are saying could happen.

Food for thought.

Stay informed my friends.

-Doc

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29 comments
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I still expect a crash to happen in the next months. A lot of new people are coming and I never trusted these bullish periods. And I’m agree, hold is the best strategy.

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I have been saying for last 6 months or so that Bitcoin will go much higher but then it will dip hard until going back higher again...

There is always people who hunt for quick profits and don't want to wait for the exchange rate to go much higher... I used to be like that when I started trading cryptos...

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Quick profits are greedy.

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Yeah... But I also went from having less than 1 USD worth of crypto to having about 80 USD worth of crypto in just three days due to perfect timing... It was back when Bitcoin network was seriously congested and that caused Ethereum taking over cross-exchange transfers pushing it momentarily to about 0.8 BTC before crashing back to about 0.09 BTC.

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If you expect a crash (and I do too) why on earth are you going to hold it when it crashes?

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It will happen but I don't know when and what will be the price but when that day comes I will buy that's clear.

Buy and hold my friend.

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I already sold my btc for 40k and am now waiting for the crash

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Because sometimes the market doesn't do what you expect.

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That is the nature of trading...we play the odds and aim to be right more than wrong!

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And that is the point. If you "trade" bitcoin your odds of seeing the most gains out of the move are less than if you just hodl it. Time will tell, but trying to trade it burns even the best of the best.

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That sentiment negates all trading - if I just wanted cryptos to actually use, all I'd have is Dash and Hive.

But I am stepping in and out of 18 different cryptos, and the purpose of that is to make gains!

I only invest in ones I think have something going for them, and if one crashes before i sell it, then I hold because there is no point selling cheap

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That sentiment negates all trading

That's exactly right! Bitcoin is for hodling. :)

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Gold is for holding, anything with a 12 year history is for trading

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There are always exceptions to the rule...

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Yes one cryptocurrency is different to all the others and different to the entire history of finance. Lets recheck that next week!

I'm betting the next US civil war (don't panic, that bet is not with you) will kick off before the end of this month, and all forms of history will repeat a new cycle.

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Yes it is quite different actually, and even if it went down or up next week that wouldn't necessarily mean I was wrong or you were wrong. I am talking about over time the currency has a tendency to go up, which is all it has done since it was created.

On the note about a civil war, I hope for all our sakes you are wrong on that one.

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12 years is the blink of an eye, and the civil war prediction underlies a lot of what I keep going on about

But I was going on about a plandemic last Feb and got called a conspiracy theorist!

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Well, you are one! :)

I still don't think it was a plandemic, though I do admit that it worked quite well for those who would have wanted it to happen.

I still think a civil war and a subsequent collapse of American Government is an extremely unlikely scenario. A more likely scenario is localized bouts of violence from time to time. Something which is also terrible, but not something that will destabilize America, its economy, or its financial markets (including bitcoin).

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That's why I used to trade mostly Ethereum, because it was more predictable... Now I mostly trade Dogecoin, because people dump it like no tomorrow to buy random altcoins, so it's very easy to get big profits just by putting the coins back on other side of the trade book... Another one of my favourites in LTC-ETH pair, because the difference between buy and sell sides can be quite large on some smaller exchanges... In the end I withdraw everything as LTC, because Dogecoin withdrawals are manually processed on some smaller exchanges even though other coins are automatically processed.

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(Edited)

Just because you have not timed your trades well does not mean it is poor practice to trade. I have made far more profits on cryptos from trading than from holding over the past four years.

Right now we both could be proven right or wrong within the next six months. Want another bet?

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(Edited)

I've traded professionally for several years. I know first hand how difficult it is to be consistently profitable. With something like bitcoin where you think it's ultimately going much higher, it makes more sense just holding it than trying to time every dip and find yourself missing out on the big move.

What's your bet?

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Things are hard to read - I'm not going to pretend I'm confident how this week will play out.

But here is a nice simple bet:

Bitcoin will trade below US$30k at sometime before April 30 2021.

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(Edited)

Ha, no chance I take that bet. Bitcoin can do anything at any given time. The point is that it will likely be higher than where you sold by the end of this year, possibly significantly, and if you don't get the dip you are hoping for, you are going to be left behind...

The way I have played bitcoin is to keep a core position that I don't plan on selling unless things go absolutely bonkers, then I also have some on the side that I try and trade a bit with... being all out of bitcoin seems pretty risky to me considering where it might be going...

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Right now this is my biggest investment (ignoring stable coins) - riding this one for now, it's going up fast - Cardano

When I think BTC has bottomed out I will jump back in - doesn't take long to swap!

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Well hopefully it keeps working out for you! And an even bigger hope would be that you make so much flipping between coins that you can eventually buy up a nice stack of HIVE and get this one moving as well. :)

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I could already do that, and it's top of my watch list

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I fully agree with you. Trading Bitcoin let alone the rest of the crypto is a losing proposition for most people because of the extreme volatility and the fact that most exchanges have a lot of manipulation by whales going.

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