Scrapping The Bottom Bare Naked

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I got to tell ya, the psychology of the crypto market is indeed a fascinating one. No doubt the smart money is getting smarter, outperforming the masses, and making tons of money while plebs are getting flushed out constantly.

Just a few weeks ago I was discussing with a good friend of mine, the man who actually brought me to crypto, and at that time(two weeks ago) he was talking about being in accumulation mode in regards of crypto. We've both become a bit of EGLD fanatics lately.

His average entry price for EGLD was of around $40. Mine is at close to $70. The ATH of this coin was $541. If sometime in one-two years from now this thing will get back to that level($541) we're both gonna see some nice returns on our investment.

The problem is that he's now out of the equation. He sold... just a few days ago. My friend fell prey to the mass mentality of waiting for lower price ranges to buy more. I'm not saying it's not going to happen, but neither do we have any certainty in that regard.

In the pic from above you have a comparison of some of the most renowned cryptos out there and the lows they scored back in 2017-2018 and during the current bear market as well. If history is to repeat itself and altcoins will have to bleed down to 2017-2018 levels, then there's definitely more room to fall.

BUT, no one said the market has to do that. We didn't have a blow-off top during the 2021 bull market, thus why would we have a similar bear market?... It's something I've been emphasizing for a while on my shitty blog.

If the math used by my friend is on his side then he will clearly benefit from nice discounts, once EGLD will be down to something like 98% from its ATH, like ADA did in 2018, but what if that doesn't happen...

EGLD is currently 90% down from the ATH, BTC is at about 72% and most of the atcoins out there, HIVE included, have already corrected something like 80%-90% from their peaks. Waiting for the ultimate bottom might leave you bare naked scrapping the dust...

Now I'm not saying I got myself a deal with buying this shitcoin at $80, $74, and $56 respectively. It might dive as low as $30 or even more, but to me, an altcoin that is down 90% from its ATH is a hell of a deal. Funny, but this friend of mine got inspired by this move by some dude on the internet saying his waiting to buy EGLD for $5.

Good luck with that.

Thanks for your attention,
Adrian

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7 comments
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If it works out, good for him, but what makes the other guy think $5 is the bottom?

There's something about dumping an entire bag to buy the bottom, it often doesn't work out. It's like buying the top, you go all in, get rekt, now you wait and wait then miss out, probably end up fomoing back in and it drops and trade sideways, leaving you in fear and what happens? You dump again, rinse and repeat.

DCA is the best strategy I'd say, because on your way down, your "average cost" is lowered like a margin price in futures, then on the way back up, it's fun gains all through. Never run out of stables is what I'd say is crucial.

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Never exit the position completely if your price target is already 10x your cost.

People who trade like this often end up buying it back at a much higher price than the price he sold.

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(Edited)

Analyzing the graph it seems that up to 26 dollars there was buying interest, then it is a pump up to 560.

You should buy as they suggested, periodic purchases, achieving a lower average cost.

But it is difficult for the recovery to be fast if it reaches 26 it will lose more than 95% of its value.

An investment that loses 90% is very risky Investing, because it is difficult to recover to previous levels, but in crypto everything is possible, and just looking at the 2017-2018 graph, all currencies lost more than 90%

There are many Alcoins that are the same and are good projects, time will tell us which will recover and which will not

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I wonder if he will FOMO back in at worse prices if things don't immediately go his way.

Hope he has a plan covering multiple scenarios!

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