The "Buying The Dip" Strategy Will Soon Return
Utilizing The Correct Strategy
Looking back to 2020 and my article entitled, “This Is Not 2018 – It’s Time To Buy The Dip!” reveals how buying the dip in a bull market is a very smart move. However, the opposite is true of bear markets. Instead of buying the dip, you should be shorting the pumps. That’s how it works. You can try buying dips in a bear market but you will have to be an exceptionally skilled trader. Not exiting a long position effectively and timeously in a bear market will quite simply mean that you suffer loss, or get rekt! Exercising a good strategy at the wrong time is the same as trading without a strategy, for the simple reason that the outcome is the same! In both instances, you are likely to lose and are completely reliant upon luck.
Shorting The Pumps
This is what I have been doing since LUNA did us the favor of definitively confirming the bear market. Up until that point, the opinions were quite mixed. The majority has now realized that this is officially a bear market and we need to see a solid bottom before getting excited again. There are still those living in denial but they are few and far between. You need to execute the appropriate strategy for the season you find yourself in. Buying the dip is a bull market strategy. In a bear market, you simply wait for a confirmed bottom or short the pumps. You just have to be careful you don’t end up on the wrong side of the market. Personally, I will cease opening shorts at approximately $22K to $20K. Even though I am expecting $19K, I would rather play it safe, even if BTC were to go even lower.
Opening New Longs & Fresh Accumulation
This will take place at the same time that I cease shorting the market. I will look to begin meaningful allocation at this point. Outside of another swan event, I don’t see BTC dropping significantly below $20K. However, I am only able to work with what the charts are currently showing. There is the possibility of $13K from a technical point of view but that is still an extreme case in my opinion. I think Cardano will be a great buy at this point. I was not that interested in Cardano previously due to it being completely overvalued in my opinion. BTC at lower levels could very well usher in a Cardano price under $0.25.
Volatility Post Bottom
Even after establishing a bottom prices will continue to be volatile. There may well be periods of boring sideways action but there is also likely to be sudden and violent moves. Bitcoin will most likely range between $30K and $60K throughout 2023. I am personally not expecting new all-time highs prior to 2024, although I will be happy to see new highs arrive earlier. As I am writing it looks like ETH is about to lose the $1700 level. Expect a bloodbath if it does. Stay focused and conduct your own research, as this is not financial advice, merely my views.
Disclaimer
First of all, I am not a financial advisor. All information provided on this website is strictly my own opinion and not financial advice. I do make use of affiliate links. Purchasing or interacting with any third-party company could result in me receiving a commission. In some instances, utilizing an affiliate link can also result in a bonus or discount.
This article was first published on Sapphire Crypto.
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