Fear & Greed - You Can't Just Stop Being A Human
Haven't the last couple of days been interesting for bitcoin and crypto markets? First, we all wait for some surprise big bull move that was supposed to happen in December, according to all so called crypto experts and gurus. That didn't happen. Ok, we can wait a little longer. Perhaps, there is a slight delay due to supply chain delays happening in the world, and everything would go back to normal and January we correct the course back to the original destination, Moon. Did the wisdom of the crowd fail again, or crowd failed the wisdom?
Bitcoin and crypto prices keep going down and down. It is starting to look real when Eth drops below 3K, btc goes below 40k, hive drop below $1, ltc drops to almost a hundred dollars. I was ok with thing prices dropping right? Why should it bother me? After all hodling is long term and short term prices don't mean much. To hide the painful reality of things, we may even say - "happy if it is down, happy if it up" and carry on with daily routine. That does sound like a good strategy. Except it doesn't work with humans. Humans aren't capable of being happy all the time under all circumstances. This is especially true when it comes to markets.
Wether we like it or not, human emotions play great role in how markets move. And the biggest culprits of all are fear and greed. I have read several books on trading, investing, and markets. One thing they have in common is they all warn about fear and greed and try to teach about how to be more disciplined traders and investors. However, one can't learn managing emotions by just reading books. I am not even sure fully managing emotions is even possible when it comes to trading. Watching portfolio going up and down, and not having emotional reactions is not an easy task.
Hodling may have changed this a little bit. Emotions are linked to logic and reasoning. We try to make sense of things as they happen and experience emotional responses to them. When hodling, we can remove logical decision making with only one initial decision to hold regardless what. Then everything else kind of becomes irrelevant. Yet, we still experience fear and greed when we see wild price swings. Since, decision not to react has already been made by when decided to become hodlers, these emotion do not affect us as much as they otherwise would.
But even hodling is not the ultimate solution or answer. Because it means different things for different people. I realized I became a hodler when I couldn't sell btc when I was actually ready to do so last year. I never considered myself to be a hodler and but since I never had a good opportunity to sell for few years, that kinda became a norm. It didn't matter any more. But this doesn't remove the fear and greed from the equation. Let's say we decide we will sell btc if it reaches 100k. Will we actually do it when that happens? Chances are, whoever held for more than 3-4 years would still keep at least some of them. Why? Greed. Because we want more than 100k. We want it keep moving up and up.
The same applies to other crypto assets as well. Why not wait for more. We always want more. This might be a good thing, if we are lucky to be in one of the good performing assets. What if we are invested in not so good performing assets? Btc keeps going up and up, and this coin we own doesn't do anything. All it does it keeps losing value against btc. What if we are in a wrong asset, thoughts keep going through the mind. What if we are missing out on something better. Doge? Shiba? What about BNB? No, I don't think we can shut our emotions down and completely get rid of fear and greed. But over time we become better at it and perhaps can use this reality to our advantage.
In fact, this is the message many trading and investment book try to convey. They will tell us that professional traders, market makers, and institutions master the way to manipulate markets and take advantage of fear and greed of retail traders. Books can inform us about such tings, but can't really teach. When it comes to fear and greed, I believe we learn the skills through experience and participating in the markets.
For example, one thing I am very confident and convinced about is that btc always goes back to its previous all time high prices given enough time. It has done so many times already. Why should the next time be an exception. Just knowing the historical performance and looking at charts doesn't not necessarily provide such confidence. One must go through bear and bull markets and experience the true fear and greed, perhaps even make bad decisions. As more time goes by, easier it gets.
This is not always true for all markets. There has been many times throughout the market histories when assets go to zero and disappear. Holding on to such assets neither would be logical, nor even in sync with emotions. That is even beyond fear and greed. This is something else. This is an irrational emotional response that is only trying to prove ourselves that we were right in investing in these assets and market has been wrong. Being in such situation is probably much worse than fear and greed.
Luckily, bitcoin is not an asset that will go to zero and disappear. Chances of something like this happening are very very low. This means, we don't need to spend a lot of time doing research and worrying about fundamentals, technicals, etc. We can just let btc do its thing. Whatever it does, it will still be around. I am yet to see a good reason why it wouldn't be around for many years to come.
Btc has also become an indicator for the rest of the crypto market. If btc is doing well we are probably in a bull market for the rest of the crypto, if btc is struggling that means trouble for most of the crypto as well. Fortunately, we on Hive have many things to do on this blockchain, and keep ourselves distract with participating in content creation, communities, games, etc and keep building crypto equities too.
When things look boring or bad in the crypto markets, it is probably a good time to get more active on Hive and get things done. We are just humans. Not sure what will markets do next. It is still fun to be part of them. It is fun to be part of Hive. Let the fear and greed do what they do. Just don't let them make decisions for you.
Obviously, none of this is a financial advice. Figured it would be more productive to put my thoughts on these not so impressive crypto market days into a post and send it to the blockchain for permanent safekeeping. Let me know your thoughts in the comments.
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Awesome
Fear and greed, since you put it, I remember all the spaces where these feelings have been expressed in me as my days pass in Hive as the currency goes up or down, however, it is as you say, in Hive there are many things to do, such as creating content, which keeps us always active, generating and contributing to our incredible Blockchain.
This is what we will definitely experience in the world of crypto in the sense that there's no stable price though as human we can never be the same when noticing such price especially when it's low but at the same time others are happy as well because it is a good time to invest more in it.
The first thing that comes to my mind when one says
is The Black Swan by Nassim Taleb - the only book related to trading I've read. It made me think totally different about exceptions
There are always unknowns.
I agree. Activity tends to be down around that time so it's easier to have more people see your own content.
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As a trader and investor, one need to be more disciplined because wether we like it or not, human emotions play important role in how markets move.
When the prices start dropping and bye is trending downwards but all the talk is about an upcoming bull run, to me that is a good indication that a huge drop is on the way lol.
You are definitely right about fear and greed and that price fluctuations don't really mean much when you hodl. It's like: 🤷♂️ "yeah price goes up price goes down, same old story."
When it goes way down it's much more exciting though. One starts to get that "hmmm, maybe I should buy some more" feeling 🤔
lol
That's why trading is a losing game, most people don't have the conviction to learn to trade and remove emotion from there decisions. While professional investors are using algos, they hardly looking at the same data you are and have a distinct advantage and ripping peoples faces off
To be honest, I didn't care the price fall of HIVE and continued to be here. I had done the same when the price increased. However, if we talk about the others coins, it would be good to determine a sell point in the bull market.
yep it's a roller coaster
It's actually really interesting from a psychological point of view. One can study oneself and therefore the whole market psychology itself when we go through these cycles.
THe cycle is something like this:
=> This is where weak hands sell and diamond hand hodl
Repeat 😂😄😅
All I can say : It’s Shoppingtime once again !!!
So far so good, hodling and staking has proven to be the best strategy for me. As long as am getting stake rewards to hold on to, am cool with the market’s activities
Vey timely article. Yes, experiencing such emotional roller-coaster for years, though it will not completely make a trader unaffected, but somehow it will help him or her avoid an emotional decision. I imagine how many traders exited from our local market due to fear of COVID variant July last year. In my case, I waited 6 months before disposing my stocks except one. They bounced a little, but the downtrend still continues. As for my performance in blockchain based game, I saw the value of my token falling from 1,000 plus USD down to just 130 plus USD. Just listened from CTT earlier and I am now beginning to see the importance of HBD in a time like this.
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2022: BTC 40K FEAR ... to 20K by next week!... to 0 !!! It will be banned!!! It is bad for the environment !!!
LOL markets
"But even hodling is not the ultimate solution or answer. Because it means different things for different people."
Mhm, it just means holding on to something, no? #HODL for your life, never ever sell :p
This is the raw truth!!!
Many altcoins; shitcoins and memecoins, won't survive this dip. Those who will survive are those who have had experiences of similar situations or those whose leading members/developers have had similar experiences with other projects. The latter can apply what they learnt in other projects to make sure their project survives the dip.
But for Bitcoin, we all know it will rise and its rise will surpass the previous ATH. But when? We don't know.
This is where Patience comes in!!!
In hive, I don't have to worry too much about the dip. In fact, this is the time I need to acquire more Hive. The Hive project and community is indeed awesome 👌
Is bitcoinwisdom.io not working for anyone else or is it just me? All I get is a blank screen ...
It is working on my phone, but not working on my desktop.
I sold all my crypto this morning because everything is red. Am I #winning?
100% winning!
So smart. See red - sell, when green - buy. Such a simple but a powerful indicator.
Thanks for sharing.
We have not made or lost any money until we sell.
For anyone who believes in the overall coin, token, stock, baseball cards, NFTs (insert your preferred investment here) then downward pricing simply means the item is on sale.
Not everyone feels that way and that's okay. We all operate to our own comfort level.
As for me...I do love a good sale. ;-)
Discounts are always good, if you have cash left that is.
Well I wouldn't say that everybody is totally happy with it, you have to admit it, it's more fancy to see a higher hive price but this is cryptocurrency we should get used to it. In my humble opinion I'm ok if the price keeps around $1, on the other hand I do love this dropping cuz it's like a great opportunity to get some hive taking advantage of the special discounts you know 😏
Yes, the investment world is very boring
and you have to don't be emotional
but in these bad times it's very hard to make it...
But of course the better time will come
So I keep my coins too
and I hope for the best
because we can't do anything! 😧
spoken like a true student of the game
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STOPCheck out the last post from @hivebuzz:
I guess everyone is used to manage their Fear and Greed especially is very volatile price action. It takes a practice of patience and courage to master this skills. I learned from the bible that the love of money is the root of all evil. We should be here for the aim to fix centralization issues through web 3 and not for the money. Great post you shared today @geekgirl
Explained nicely. :) It is hard to watch value drop so much. I'm trying just chill and be patient, but it is hard and it does suck. I have a headache since seeing the crypto prices.. :P
educative write up I must commend. Fear and greed no doubt are human beings’ characteristics. However, in my opinion (I might be wrong though) I don’t think hodling at a period of fear , uncertainty and doubts is a sign of greed ; I see it as a sign of tenacity for an ardent risk taker.
Your explanation is amazing.
Crypto tokens are really going bearish this period. It takes the grace of God to be patience.
Greed leads to downfall and when it is connected to crypto, where up and down is the rooted system and, like progressive waves, faces crests and troughs, then being too much greedy will cause fatality and sometimes being subjected to financial loss.
I think,the best part of dealing with the crypto is to have a mediocre satisfaction, that would help to being limited in greed and which is in fact nice for the future.
Hello, have you drawn this photo yourself? Ah,this looks so lovely and artistic...
Greetings, 🙂
excellent insight, thanks!
Trading is not for the faint of heart.
It has been 6 months since I first arrived on the crypto sphere, and way less time I luckily found Hive.
This is my first bear and it is really scary but I try to gather strength from posts like yours and occupying my mind with thoughts and actions which generate value that doesn't depends on green candles, like writing articles and curating XD
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