HOW TO PROFIT FROM THE NEXT BTC CRASH
Many of us lost lots of moola during this downturn. Others of us did okay because we knew everything was overinflated but we could've done so much better. Very, very few of us here made nice returns in the last 30 days.
If you were disappointed by your returns this downturn, now is the time to learn.The following provides a template for what you should be thinking the next time you are heavily invested in a crypto bubble and btc crashes.
The BTC downturn play is incredibly simple. In a nutshell...sell your btc before it approaches the Moving Average (MA). buy when it gets there. sell the bounce (20% is decent target) and/or buy alts for quick flip. sell and wait for next MA.
1) bring up the 50/100/200 day moving averages on your daily time frame. These are core supports that BTC bounces off of during its bull run.
2) Keep an eye on the first crash. Really good chance you will not anticipate the first crash, nor should you really. Plenty of money made at the end of bubbles. The first crash of a true change of trend will likely be harder than all the previous corrections during the bull run. We crashed straight down almost 50% in a few days. None of the other corrections did anything like this at this speed. This was a huge warning sign, but our greedy little eyes didn't want to see it.
3) IT WILL BOUNCE OFF THE 50 MA, even if it initially dips through it. The market was so freaking bullish before hand, there will be a lot people thinking they are "buying the low" and the first crash will likely correct back up significantly. If you determine the crash is coming and you are still significantly away from the 50 MA, you could sell and wait until it touches to buy. If you have held too long and your approaching the 50 MA, just wait. it will bounce.
4) Look at each FIRST time the price approached each moving average. Every time, the MA sent the price back up above it, even if it took a day or two. Many times it sent it 20-30% higher. Look to buy right at the MA
5) enter oversold alts. hold until they bounce sufficiently for extra profit and exit to fiat. See #6 for which alts.
6) After the 50 MA sell off the bounce, LOOK for alt coin charts that were late to pop. We saw XLM, CVC, BNB, a number of coins go off on late elliott wave runs AFTER btc crashed from 20k to 10k. Why did this happen?
Because btc's own run pushed down everyone's charts. they were pushed down FOR MONTHS. Bullish coins had a relief of pressure once btc lost all that value and they took advantage to initiate either a wave 3 or wave 5.
7) monitor BTC to make sure it is hold ing above the 50 MA. sell your wave 3/5 alts once you begin to receive bear signals (MACD divergence is common at the top on 30 min/1 hr chart, RSI overbought)
8) At this point, if your convinced a downtrend is in place, you could sit 100% on the sidelines. More aggressive traders can ride the bounce back up approaching the ATH (but obviously if this is a bear scenario it won't get there)
9) prepare to buy at 100 MA. Don't bother entering before that unless you intend to day trade and sell it within hours. Enter alts that are oversold. sell bounce. exit into fiat completely. wait for 200 MA.
10) rinse and repeat 200 MA
NOTE: you may be on the sidelines for days at a time. It's just the safest way to play a downtrend.
Many of us lost lots of moola during this downturn. Others of us did okay because we knew everything was overinflated but we could've done so much better. Very, very few of us here made nice returns in the last 30 days.
If you were disappointed by your returns this downturn, now is the time to learn.The following provides a template for what you should be thinking the next time you are heavily invested in a crypto bubble and btc crashes.
The BTC downturn play is incredibly simple. In a nutshell...sell your btc before it approaches the Moving Average (MA). buy when it gets there. sell the bounce (20% is decent target) and/or buy alts for quick flip. sell and wait for next MA.
1) bring up the 50/100/200 day moving averages on your daily time frame. These are core supports that BTC bounces off of during its bull run.
2) Keep an eye on the first crash. Really good chance you will not anticipate the first crash, nor should you really. Plenty of money made at the end of bubbles. The first crash of a true change of trend will likely be harder than all the previous corrections during the bull run. We crashed straight down almost 50% in a few days. None of the other corrections did anything like this at this speed. This was a huge warning sign, but our greedy little eyes didn't want to see it.
3) IT WILL BOUNCE OFF THE 50 MA, even if it initially dips through it. The market was so freaking bullish before hand, there will be a lot people thinking they are "buying the low" and the first crash will likely correct back up significantly. If you determine the crash is coming and you are still significantly away from the 50 MA, you could sell and wait until it touches to buy. If you have held too long and your approaching the 50 MA, just wait. it will bounce.
4) Look at each FIRST time the price approached each moving average. Every time, the MA sent the price back up above it, even if it took a day or two. Many times it sent it 20-30% higher. Look to buy right at the MA
5) enter oversold alts. hold until they bounce sufficiently for extra profit and exit to fiat. See #6 for which alts.
6) After the 50 MA sell off the bounce, LOOK for alt coin charts that were late to pop. We saw XLM, CVC, BNB, a number of coins go off on late elliott wave runs AFTER btc crashed from 20k to 10k. Why did this happen?
Because btc's own run pushed down everyone's charts. they were pushed down FOR MONTHS. Bullish coins had a relief of pressure once btc lost all that value and they took advantage to initiate either a wave 3 or wave 5.
7) monitor BTC to make sure it is hold ing above the 50 MA. sell your wave 3/5 alts once you begin to receive bear signals (MACD divergence is common at the top on 30 min/1 hr chart, RSI overbought)
8) At this point, if your convinced a downtrend is in place, you could sit 100% on the sidelines. More aggressive traders can ride the bounce back up approaching the ATH (but obviously if this is a bear scenario it won't get there)
9) prepare to buy at 100 MA. Don't bother entering before that unless you intend to day trade and sell it within hours. Enter alts that are oversold. sell bounce. exit into fiat completely. wait for 200 MA.
10) rinse and repeat 200 MA
NOTE: you may be on the sidelines for days at a time. It's just the safest way to play a downtrend.
Note
TL;DRThe pattern is obvious. In the next crash, which you probably will intuitively know is coming but can't unclench your Golem hands off your shiny coins, you will miss the first dump. Don't worry, the 50 MA is significant support. sell a few days after the bounce off there.
Then merely sit out and wait until it falls to the 100 MA. buy, enter oversold alts, sell back into fiat after bounce. wait for 200 MA. rinse and repeat.
Note
significant bounce off 50 MA
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.