Research! Research! Research! I smell blood.
Updated
I don't disagree with the notion that right now we are set up almost identical to the market in 2014. I don't disagree that we probably have a while longer before we see a bull run. But I am pretty confident we aren't going to see 2+ years of bear market and I don't think we will see a 2+ years of bull market after. I think what we are experiencing is the final days of true manipulation, the beginning days of true adoption, and a culmination of some really strong forces. The noise will continue, but the rise will be more steady. Let me explain...
Maybe we haven't hit rock bottom but with the bulls crying their eyes out and people shorting so sure of themselves, I would say that it's a pretty good time for some or all to get wrekt. Think about it. There is a moment when you can make both animals cry. The minute of reversal where it's obvious that a massive gain is coming, but hasn't yet so the shorts get liquidated because of the lack of coverage. And then there are the bulls that so badly want something to moon, but in reality it's going to be a slow steady climb.
Going back to the rate of adoption, think of the bell-curve that happens. No where in that curve is there a break. Adoption and price accelerate through about 1/3 of the total life cycle. There is however sometimes a chasm, much like the described perilous valley in the accepting of humanoid robots, that causes confusion before all of the early adopters get on board. The only thing there is to determine is how long the life of a cycle will be. In my last post I messed around with GDPs of five countries. I found at just one percent of their GDP in crypto-currency, the number is actually a little more than what the current market cap was listed at that day of 299B.
In a perfect world right now we would see enough growth through adoption that we could take profits and new money coming in would offset the profit taking. But instead let's see what a macro story can tell us. Right now there just aren't enough retail stores taking crypto to make a difference but what happens when that threshold is crossed.
1. Some one buys something with crypto.
2. Price of crypto goes up due to fiat entering a market.
3. Amount of fiat in cirrculation goes down
4. No reason to sell crypto for fiat because enough retail to sustain oneself.
5. You get paid in crypto from work.
6. You buy more stuff gradually shifting more GDP to crypto.
6. Cycle repeats.
This is what we should be striving for but due to where we are in this adoption cycle right now we are still ironing out wrinkles and people don't see a bigger picture. So Research, Research, Research! Prop up your own currency and figure out how you can make actual differences. Lastly, sniff around for the blood. Look at opposing views and see who is either scared or overly-confident. Just like bulls think the market will go up even in the short term, bears tend to think they will continue going down in the long term.
Refer to my Buddhist approach to investing for inner peace if you seek the middle ground. ;-)
Maybe we haven't hit rock bottom but with the bulls crying their eyes out and people shorting so sure of themselves, I would say that it's a pretty good time for some or all to get wrekt. Think about it. There is a moment when you can make both animals cry. The minute of reversal where it's obvious that a massive gain is coming, but hasn't yet so the shorts get liquidated because of the lack of coverage. And then there are the bulls that so badly want something to moon, but in reality it's going to be a slow steady climb.
Going back to the rate of adoption, think of the bell-curve that happens. No where in that curve is there a break. Adoption and price accelerate through about 1/3 of the total life cycle. There is however sometimes a chasm, much like the described perilous valley in the accepting of humanoid robots, that causes confusion before all of the early adopters get on board. The only thing there is to determine is how long the life of a cycle will be. In my last post I messed around with GDPs of five countries. I found at just one percent of their GDP in crypto-currency, the number is actually a little more than what the current market cap was listed at that day of 299B.
In a perfect world right now we would see enough growth through adoption that we could take profits and new money coming in would offset the profit taking. But instead let's see what a macro story can tell us. Right now there just aren't enough retail stores taking crypto to make a difference but what happens when that threshold is crossed.
1. Some one buys something with crypto.
2. Price of crypto goes up due to fiat entering a market.
3. Amount of fiat in cirrculation goes down
4. No reason to sell crypto for fiat because enough retail to sustain oneself.
5. You get paid in crypto from work.
6. You buy more stuff gradually shifting more GDP to crypto.
6. Cycle repeats.
This is what we should be striving for but due to where we are in this adoption cycle right now we are still ironing out wrinkles and people don't see a bigger picture. So Research, Research, Research! Prop up your own currency and figure out how you can make actual differences. Lastly, sniff around for the blood. Look at opposing views and see who is either scared or overly-confident. Just like bulls think the market will go up even in the short term, bears tend to think they will continue going down in the long term.
Refer to my Buddhist approach to investing for inner peace if you seek the middle ground. ;-)
Note
Something I forgot to mention. If there was a 2+ year bear market last time this happened in the charts I would expect it to be around half of that now. Conservatively speaking in 2013 I believe the price shot up to $1000 and fell to $200. Now the price has shot up to almost $20,000 and has fallen back down to $6500. Not quite 80% but even closer back in February. A way to look at this by guesstimation would be to say the market is almost 20x bigger now on the high side and about 32.5x bigger on the low side. Let's use the smaller number 20x. If the last full cycle lasted about around 913 days this next one could be less 20% of that or 20x shorter. Not the same calculation mind you.
At 20% shorter it's going to last 730 days total minus the 180 we've already experienced. If it is 20x shorter it would have lasted 46 days. So now you have a low and a high number to work with. Look for correlations in the numbers to help you along. When market sentiment and psychology is involved there is no rational causation.
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