Making your first million is the hardestAfter that, it's leverage.
The issue for me as a long-time trader, is people these days don't seem to have time, patience or the ability to absorb information.
They read an article or watch a few seconds of a stream and assume they know!
I am not just talking crypto, I mean in general. The attention span of a fish.
I read a pretty decent article by this guy @holeyprofit
He talked about Bitcoin Mania with a lot of truth, most people won't want to hear.
Article here
The issue is the whole market right now are currently hinging on or near their all-time highs, Gold, Bitcoin, SPX (S&P500) stocks such as Meta, NVIDIA and loads of others.
Instead of shouting for even greater highs, the question should be "what is sustaining the rally?"
For the majority of retail traders, they assume it's different this time. Gamestop was up until it was not.
The issue is that they never learn. They have no concept of time factors and the assumption that markets only ever go up is the very reason the majority of traders stay broke.
Crypto is a really interesting space, when I first got involved in 2011, it was a punt. I got lucky, but buying cheap and selling high is what most people strive for. Yet, reading posts and social media content - nobody sells, they all buy low, stacking sats when the price drops. So where is the profit? Well paper gains I assume.
Game stop...
Not to focus on Crypto; the markets as a whole can be profitable and just like Kenny Rogers said - "if you're going to play the game boy, you got to learn to play it right. know when to hold, know when to fold, know when to walk away and know when to run"
Every hand's a winner - every hand's a loser.
Key message there!!!
Trading vs investments - if you are looking to make it big on one deal, that's different than profiting from the market every week, every month and every year.
Risk management is key, scaling your account, cutting losers quickly and adding to winners. Many won't understand this concept. Markets go up and everyone is a genius in a bull market.
Once you start scaling an account, the trade percentages in terms of rewards you seek don't matter the same. You don't need 10x returns on your thousand dollars.
A 3% win on your million-dollar account is a different game.
Back in 2021; I wrote this educational post about the psychology of the markets. I used the Simpsons as a way to get the message over.
Markets breathe and the rise and fall, rise and fall.
Once you realise you can take from the market consistently, you will see the stress disappear, and the care of price up or down matters less. Your investment criteria changes and the scope gets wider. This is how you scale from that first million, into the second and third. Not having all eggs in one basket and hope it goes up forever.
What if gold drops 10% and you are long? can you afford a 5 year spell on the investment you have? These are the kinds of questions you need to be asking yourself.
What if Bitcoin's halving is a buy the rumour, sell the news and we take another 3 years to get back to a new ATH?
"ah it's different this time" - yeah I heard all that in 2021 when certain influencers were calling for $135,000 worse case within a month. We are 2024 and still roughly half of the way to 135k??
I know for you guys who want to learn and progress you would have read this far; for those who "already know" they have stopped reading about 4 lines in and seeing a picture or 2. They leave a comment due to their keyboard warrior mindset and fish-like capacity for thinking.
The point is to ensure you deploy proper risk management, especially here near the tops of a lot of these markets, trail your stop losses, and don't forget to cash out your profits. Paper gains can quickly become paper losses. If you're serious about money making, be prepared to diversify, be prepared to sit on your hands, keep cash in your pocket as well as be prepared to take calculated risks.
Disclaimer
This idea does not constitute as financial advice. It is for educational purposes only, our principle trader has over 20 years’ experience in stocks, ETF’s, and Forex. Hence each trade setup might have different hold times, entry or exit conditions, and will vary from the post/idea shared here. You can use the information from this post to make your own trading plan for the instrument discussed. Trading carries a risk; a high percentage of retail traders lose money. Please keep this in mind when entering any trade. Stay safe.
