Bitcoin Forum
November 12, 2018, 07:26:07 PM *
News: Latest Bitcoin Core release: 0.17.0 [Torrent].
 
   Home   Help Search Login Register More  
Pages: [1]
  Print  
Author Topic: Logic- Not Emotions: Making profits in any market cycle  (Read 21 times)
Doctor_jay
Newbie
*
Offline Offline

Activity: 12
Merit: 2


View Profile
April 26, 2018, 01:51:15 AM
 #1

Logic, not emotions. It's easier said than done, but this is the key to surviving a bear market. The recent bear market in crypto may have seemed like an eternity.  So you would definitely feel the heat if you've bought crypto at a high price and then see it lose it's value day after day.

You are not alone.

In fact this is part of the very too common investment market cycle! The cycle has been repeated over the years and with many other investment vehicles. Some past examples of such cycles are:
  • Japanese bubble and bust of 1980s/early 1990s
  • The “Asian miracle” boom and bust of the 1990s,
  • The tech boom and bust of the late 1990s/early 2000s
  • The US housing and credit-related boom and bust of last decade
  • The commodity boom and bust of late last decade into this decade.
Cryptocurrencies are not immune to this pattern.

Investor psychology plays a big part in this expansion and contraction cycle. We know it shouldn't, but emotions do indeed override our logic. Emotions lead us to buy when we have a fear of missing out. Emotions then lead us to a euphoric phase where strong growth makes us believe we will continue to make huge gains. So we either invest more or continue to hold.

This phase is normally short lived, but we don't sell due to greed. Emotions then make us panic when the downturn accelerates. Finally, emotions make as sell when prices bottom out and we feel there is no hope left.  

Numerous studies show people suffer from lapses of logic when investing. In particular, they:
  • tend to down-play uncertainty and project the current state of the world into the future –resulting in a tendency to assume recent investment returns will continue;
  • give more weight to recent spectacular or personal experiences in assessing probabilities. This results in an emotional involvement with an investment – if it’s been winning, an investor is likely to expect it to keep doing so;
  • Tend to see things as obvious in hindsight – driving the illusion the world is predictable resulting in overconfidence;
  • Tend to be overly conservative in adjusting expectations to new information – explaining why bubbles and crashes normally unfold over long periods;
  • and tend to ignore information conflicting with past decisions.
So, rest assured, it's not just you!

There's a large crowd of investors that tend to do the exact same thing. This magnifies and accelerates the cycle more than it really should, making it more painful for everyone.Crowd mentality is evident in trading- it's because of this that 'smart' traders know how to make money in trading.There are a few things to note in crypto world, which makes it very easy for 'smart' traders to play the game more effectively.

They know that behavior can be contagious: social media and news channels cause this. This is expanded from the fact that most crypto investors get their information from the same sources.

They know that pressure will cause you to behave on emotions rather than logic: uncertainty, drama, fear of missing out, fear of collapse, grand theories of opportunity; these all feed your emotion.

They know that major displacement events will motivate investment: cryptocurrency and blockchain will 'revolutionise' the world, it will replace <insert any name here> industry, it will create freedom for individuals and bring a well deserved anarchy to our state; all these statements are too common in the channels that promote cryptocurrency.

While the emotions you experience during any market fluctuation is organic, there’s no denying that some cryptocurrency influencers and investors orchestrate initiatives to manipulate cryptocurrency prices.

No, these aren't the 'whales' and the 'sharks' of the crypto world.

No, not the big players that can easily move the entire crypto market with a single swift move.

I'm talking about the common crowd of investors that you see lurking on the social media channels.

You have the Shills who are trying to promote their crypto to make a quick buck- they're happy to promote useless coins at the expense of other investors looking for genuine investment opportunities. If you don't know how a shill operates in the crypto world, then you need tolook at this!On the other hand you have FUD-spreaders, spreading fear, uncertainty, drama. They missed the boat and are hoping their online shenanigans can temporarily bring the coin’s price down enough to allow them to buy in at a discount.

This makes it hard to decipher a genuine concern from someone who is looking out for the community.

You also have fan-boys, true diehard fans of a coin. They believe their coin will solely resolve all world's problems and will protect that belief by any means necessary. They spite any other coin that may be doing better in growth.

Finally you have the trolls, who are simply indulging in a few laughs.The recent crypto crash is definitely no laughing matter though, especially if you invested anytime between December 2017 and January 2018. If that's the case, most of your investments would have seen anywhere from 40 to 60 percent in losses.Having seen such loses, some would have surely sold out. Others would have decided to hold on to their precious coins.

 But are these loses enough to end of your crypto journey? do you continue to hold your bags and hope for the best? or do you play the game the way it should be played?

You will find the rest of the post easier to read, with images, here - Logic, Not emotions- Surviving a bear crypto market - where I provide some examples on opportunities of making profits even during a long bearish cycle.  



Blockogy's mission is to educate the market on blockchain technology and cryptocurrency, and to play a strong part in the mass adoption of these. We see the potential for this technology, the advantages it will bring, and how it will shape the future. Along with it though will come the downfalls, the downturns, and the uncertainty. We hope to alleviate this uncertainty, by creating awareness, providing education, and tool sets that will help promote the adoption of blockchain technology.
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
1542050767
Hero Member
*
Offline Offline

Posts: 1542050767

View Profile Personal Message (Offline)

Ignore
1542050767
Reply with quote  #2

1542050767
Report to moderator
1542050767
Hero Member
*
Offline Offline

Posts: 1542050767

View Profile Personal Message (Offline)

Ignore
1542050767
Reply with quote  #2

1542050767
Report to moderator
Moiyah
Member
**
Offline Offline

Activity: 322
Merit: 20


View Profile
April 26, 2018, 06:52:44 AM
 #2

Quote
But are these loses enough to end of your crypto journey? do you continue to hold your bags and hope for the best? or do you play the game the way it should be played?

Nice words and encouraging post you got there, buddy. But losses are just a natural thing in cryptocurrency trading. Ever since we've entered thing crypto world we already knew the consequences it will give to us, but giving up is not the right thing to do. I still continue to trade and still hodl coins that I think is the worth got a long term investments.

Quote
Investor psychology plays a big part in this expansion and contraction cycle. We know it shouldn't, but emotions do indeed override our logic.

I also admit that sometimes, my emotions overtake my performance and affect my mood. I also can't deny the fact that I am also panicking when the price of my coins are dropping seriously. I just have to let that emotions pass and accept whatever it takes.


▀▀▀▀▀▀     │      SWIPE      │      Monetizing Mobile Engagement Data     ▀▀▀▀▀▀
▄▄▄▄▄▄       Whitepaper     Telegram     Twitter     Reddit       ▄▄▄▄▄▄
omonuyak
Sr. Member
****
Offline Offline

Activity: 602
Merit: 264


View Profile
April 26, 2018, 07:18:18 AM
 #3

The market actually have it own mind and that is what many investors did not know. Bitcoin is not limit to the global downward trend of most of the trading instruments and the cycle has repeated itself several times. The most things that traders did not know is that Bitcoin cannot continue to go down and it cannot continue to go up also therefore you must follow the pattern in other to make profits from this market.

███ Bitsgap.com - Cryptocurrency Multi-Exchange Trading Platform ███
[Sign up for Free]
Portfolio Tracking | 25+ Exchanges with One Interface | Free Arbitrage
Pages: [1]
  Print  
 
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!