Trade vs. HODL - avoid traps

[1miau]

After all, we know how valuable Bitcoin is, so we need to protect and possibly even increase our holdings but when doing so, many traps should be avoided.
One of those traps is to fall for the misconception to increase Bitcoin profits from trading reliably.


Trade vs. HODL



Bitcoin's fundamentals make it very suited to HODL because Bitcoin’s supply is limited to 21M units itself. By HODLing, Bitcoin should increase likely in value long-term and HODLing is our safest way to make a profit. Low risk – likely to succeed.
But we need to be patient and favor safer long-term gains instead of quick but more insecure profits.


Technical analysis is risky

Some people have claimed, that trading by technical analysis is a reliable way of making money – it’s not true because it's very risky, especially for short terms (daytrading). If technical analysis would be predictable, it would be easy to take a credit, give it to a "professional" trader and he would make a profit.
Be careful and don’t fall for such offers, it’s a scam!
Because if technical analysis would be a reliable way to generate profits, everyone would be a millionaire. A coder would have coded these "technical analysis patterns" and trade according to them.
Such a program does not exist because it doesn’t work. Technical analysis is not predictable and doesn’t generate reliable returns.
Like xkcd explained it: technical analysis is more like a pseudo science:


https://xkcd.com/2101/


HODL instead!

When we are HODLing, we are taking advantage from Bitcoin’s scarcity. Bitcoin is limited to 21 M BTC. And every 210,000 blocks, block rewards (for miners) will be halved, decreasing newly issued units of Bitcoin aproximately every 4 years.
By HODLing, we are simply taking advantage from Bitcoin's scarcity because Bitcoin is a good asset for saving. It might be volatile in terms of Bitcoin price now but as more people will hold Bitcoin, we could see Bitcoin's price getting more stable – increasing demand for Bitcoin as a store of value even more.

It could take some years until we see some decent profits as Bitcoin's price has been moving in cycles of around 4 years but so far HODLing has proven to be reliable (and will also make Bitcoin less volatile).

Tl; dr:
Better HODL, don't trade!  


Translations:

Language	translated by	Title
___________________________	_________________________	_______________________________________________________________________
Arabic	Nalain420	التجارة مقابل HODL - تجنب الفخاخ
Bahasa Indonesia (Indonesian)	Taufik123	Trading Vs HODL - Menghindari Jebakan
Bengali	Z_MBFM	ট্রেড Vs হোল্ড এর ফাঁদ এড়িয়ে চলুন
Deutsch (German)	1miau	Warum Trading so riskant ist (und man besser HODLn sollte)
Français (French)	iwantmyhomepaidwithbtc2	Trade vs. HODL - Évitez les pièges
Nigeria (Naija)	Chilwell	Trade vs. HODL - avoid traps
Română (Romanian)	GazetaBitcoin	Tranzacționare vs. HODL – evitați capcanele
Türkçe (Turkish)	mindrust	Al-sat vs. HODL - tuzaklara kanmayın
Pakistan (Urdu)	Compromise me	تجارت بمقابلہ HODL - پھندوں سے بچیں۔

Reserving new translations is currently not available.

[1715029502]

1715029502

[drwhobox]

I have tried bitcoin trading and failed, I learned technical analysis but again failed. Bitcoin just doesn't follow the technical analysis terms like the forex or it is me who is failed to give my 100% effort on learning and implementing those into bitcoin trading.

But after trying so many years, probably a good 4 years trying to trade bitcoin successfully (make profit day trading), I gave up 2 years ago. Now I can live my life peacefully and avoid day trading.

[un_rank]

Hodling is a more consistent means of benefiting from bitcoin and does not require any sort of technical skill to utilize, all you need to know is how to properly set up a wallet and back it up, making it accessible to even newbies to bitcoin.

But checking the info-graphics, I do not consider hodling to be a linear path to profits, there are pitfalls and market volatility which makes it difficult to hold on to your coins. There is also the emotional development one has to go through to hodl through different market situations.

HODL, don't trade! 

Should this apply to everyone or those who do not profit from it? No trading strategy guarantees profits, but there would be people who get net profit from trading.

- Jay -

[1miau]

I have tried bitcoin trading and failed, I learned technical analysis but again failed. Bitcoin just doesn't follow the technical analysis terms like the forex or it is me who is failed to give my 100% effort on learning and implementing those into bitcoin trading.

It's because "technical analysis" doesn't work. Or why are there so many people trying to sell their "trading courses based on TA"? 
They could just trade themself and make big profits as it's always advertised by them. But they don't do this. Wonder why? 
Because it's not a reliable way to make a profit. 

Maybe, we could analyze economic events and try to predict the market (often by insider knowledge). That's hard as well and also very risky but simply by drawing some lines into the BTC chart, and hoping that we are right, won't get us far. Or it wuld be very risky and only based on luck if we get far.

But checking the info-graphics, I do not consider hodling to be a linear path to profits, there are pitfalls and market volatility which makes it difficult to hold on to your coins. There is also the emotional development one has to go through to hodl through different market situations.

You are right, the info-graphic was intended as a Meme. 

[isaac_clarke22]

Holy crap! This thread is spot on from what I experienced when I attempted day trading back then. I don't even know what most of those terminologies meant in the "trading" image.
I took some time to learn day trading through Youtube (I believe it was Cryptojack channel that taught me not sure if the channel is still active though), since I was not fan of just reading books and not being able to see the demonstration of how signals are used. Binance was the first exchange I tried since it's the most mentioned one at that time.

I only knew some instruments like Bollinger Bands and RSI and I thought that just by simply following the tutorial would somehow give me a satisfying results/profits, but nah. It all ended up in a loss and just by learning and watching throughout the whole tutorial I was already exhausted considering I also have my 9-5 and I was only trading in hopes of having some side hustle. I just went on and go full hodling and call it there. Best decision of my life.

There might be some people really earning a lot from trading, but I won't go through those hoops of mental exhaustion ever again. Trading is not meant everybody.
Love the tl;dr by the way, sums up what should I had done instead. I could have invested it more in learning programming instead.

[sheenshane]

Stay away from trading by technical analysis


HODL instead!
.
.

tl;dr:
HODL, don't trade!  

I tend to agree with this and I think you nailed the right point.

I tried trading once when I had free time when I don't have a small business outside but now, I can't focus too much on crypto just like trading which is time-consuming, or else, it's a wasting time.  Technical analysis won't work, it might I believe in fundamental analysis that's based on news than this technical analysis.  It's always the price is unpredictable.

I learned to HODL in the long-term and aim for profit than trading.
But, if you want to gamble your money and have a short-term of waiting profit, trading is good for you.  It's a high risk if you're lucky enough, there will be a quick profit too.

[1miau]

I just went on and go full hodling and call it there. Best decision of my life.

Wow, glad to hear you got it sorted!  

There might be some people really earning a lot from trading, but I won't go through those hoops of mental exhaustion ever again. Trading is not meant everybody.

I totally agree here. The mental exhaustion part is a very important point. It's part of the game for trading and can also result in big losses if traders are making rushed decisions.
As you've said, it's much more efficient to dedicate the time for other things.

After all, trading is a very risky and stressful way to make money:

A trader after he traded successfully
 

[Die_empty]

I have tried bitcoin trading and failed, I learned technical analysis but again failed. Bitcoin just doesn't follow the technical analysis terms like the forex or it is me who is failed to give my 100% effort on learning and implementing those into bitcoin trading.

Applying one's knowledge in sectors like Forex and trading to Bitcoin might not yield accurate predictions. This is because bitcoin is not like other foreign exchanges or stocks that can be manipulated easily. I observed that bitcoin is gradually becoming independent from external manipulative forces.  

But after trying so many years, probably a good 4 years trying to trade bitcoin successfully (make profit day trading), I gave up 2 years ago. Now I can live my life peacefully and avoid day trading.

The best advice I always get from most bitcoin supporters is just keep hodling because the gain of keeping your coins is far greater than the little profit you make from trading. Although the price currently looks attractive to trade, I have decided to keep my coin because it is my long-time investment.   

[cryptoaddictchie]

I agreed. No matter what you think or analyze, with a supply like 21million and some of those arent even used or loss in the space. We can see how limited this could be, imagine you have a 1 bitcoin over that fixed supply, even smaller or scarce than the peoples population among the world. You can see it worth in the long run that will succeed. This is an incredible explanation OP!

[Despairo]

You missed the most important thing here.

Make sure you're buy Bitcoin and not buy shitcoin aka altcoin

It doesn't matter how long you hold, shitcoin will always being a shitcoin where it might be a scam, become a deadcoin, etc. There's no point for holding shitcoin for longer than 6 months or a year, also you shouldn't diversify your investment to other shitcoin. If you want to diversify you need to buy other assets e.g. gold, stock, or real estate.

Anyway I'm 100% agree with your point, it's better to hold Bitcoin rather than to trade it. Just make sure you're buy Bitcoin with money you can afford to lose, so you wouldn't really worried when the Bitcoin price suddenly drop for 80-90% in the bear market.

[Maus0728]

Hmm..So is position trading acceptable for bitcoin and not considered as trap?

I mean you don't have to go through a tedious task of technical analysis on a daily basis; instead, you can look for buying and selling on a much longer timeframe. This way, you can maximize a good return but it will take a lot of patience and a bit of mental strain. Even if you don't sell at peak, there is still a good probability that the price will retrace for buying opportunity.

I don't know, it feels like some people do this trick in accumumulating sats in the long run.

[mk4]

I have tried bitcoin trading and failed, I learned technical analysis but again failed. Bitcoin just doesn't follow the technical analysis terms like the forex or it is me who is failed to give my 100% effort on learning and implementing those into bitcoin trading.

Even if you used TA on forex, it still doesn't mean you're going to make money. Always remember when doing active trading, you're trading against actual professionals on trading desks working for huge companies. Quite difficult to win against them if you're just a retail trader trading in your pajamas.

[Crypto-DesignService]

DCA is another safe way to hodl Bitcoin long-term. It provides lesser risk since the price is very volatile.

[pooya87]

It doesn't matter how long you hold, shitcoin will always being a shitcoin where it might be a scam, become a deadcoin, etc. There's no point for holding shitcoin for longer than 6 months or a year,

That is so contradictory! If you know something is a shitcoin and it is going to die, then there is absolutely no justification for buying it in first place let alone bagholding it for such a long time as 6+ months! The only time buying a shitcoin could be acceptable is if you are seeing an ongoing pump and want to jump on board and most importantly if you get out very quickly like after gaining 20% profit or a couple of hours whichever came first.
That's one of the rare cases that trading is OK with me.

[jrrsparkles]

HODL is the safest but not really easy to follow cause being patient when the market goes up and down everytime is a stressful job too but once we understand this is how it will be and adapt the condition then it will be a money making heaven.

On the other hand trading is risky but I do day trade with small capital compared to my portfolio value for fiat so I won't touch my long term investments at any cost and cover the expenses along with needs and wants via profits from day trading.

[un_rank]

I don't know, it feels like some people do this trick in accumumulating sats in the long run.

This could work to accumulate some sats if done right. For example, one who held through the last bull run, cause they have not reached their target profit has the exact same amount of bitcoin as they did during the bear market, but another who sold at the peak or some percentage off it and bought back at the bottom or some percentage off it, would have a much higher amount of bitcoin in their portfolio.

The downside here is you have to be constantly checking the price as well as holding some stable coins which you exchanged for bitcoin, while waiting for the retrace.

- Jay -

[libert19]

Hodling works for Bitcoin alone, not for others. Have given up plenty money by holding coins until they turned to dust. Had I converted those profits into BTC, would be having good amount of BTC today. But oh well, it's what it is.

[Peanutswar]

There are alot of people who would like to earn immediately that's why they make a trade and get a ride with the market volatility which is still good if they have fundamental and other tools for making short-term trading, but the profit is not assured right here if you don't have the knowledge, that's why still tons of people make a lot of time just to consider this as their job if you are just an investor that doesn't want to really care with the price movement because you are aiming for months or years of holding I guess this is a great deal for making a hold for me its the safest than making risk with the short term trade sometimes the market not assured movement because of the whales.

[BRINIRHA]

hodling is indeed much more effective for me. even though I am a beginner but I prefer to be hodling than keep trading it every day. maybe because my schedule is quite busy in managing the business. so I'm not confident enough to do technical analysis to trade. because I also do not understand much about technical analysis.

and I think hodling is more comfortable because my mentality is more awake. moreover, I continue to collect bitcoins with an installment strategy like DCA. so I can stay focused on my business. and let my investment run and increase as time goes on.

but I have occasionally tried trading but it was in altcoins. and it is only done occasionally when I hear an event is happening or a hype is brewing.

[mk4]

Hodling works for Bitcoin alone, not for others. Have given up plenty money by holding coins until they turned to dust. Had I converted those profits into BTC, would be having good amount of BTC today. But oh well, it's what it is.

Hodling can work really well for certain altcoins as well. The only problem being that you need to actually pick the correct ones, in which is very difficult to do — it's pretty much like looking for a needle in a haystack.