0/ This whole bear market I've been repeating that Bitcoin prices move quickly, unexpectedly and in large jumps. If you are following any of the technical analysis talking heads or if you think you have an edge in doing TA yourself, take a few moments to analyze historical prices
1/ The chart below, for example, has data from 1/1/15. The scatter plot shows daily returns. Do you see how many of those are above 7%?
No need to go far, remember 4/1 when BTC moved from 4,150 to 4,900?
How many "experts" saw that coming?
2/ When markets go down, you often hear: "well... I'll just take my money and wait on the sidelines"
The opportunity cost is massive. I remember in 2008, after the crisis, when many investors were on the sidelines and only came back after 2011 at much higher prices.
3/ Here's a list of the top-1 day moves of BTC since 2015
4/ And here are the top-weekly returns since 2015
5/ As an example, let's assume you invested in BTC in 1/1/2017 and during that period you "only" missed the top-5 blocks of best 3 days. Or a total of 15 days 'only'. The details are below but the bottom line is that you would have missed 40% of the total return.
6/ Of course this analysis is largely biased since it excludes only the best returns but the goal here is to show that by not being allocated 100% of the time you are exposed to a massive gap risk.
7/ So beware when the talking heads, the so-called 'experts' of Bitcoin, tell you with all their confidence that Bitcoin will do this or do that. THEY DON'T KNOW. And if they did, they would spend less time at twitter and conferences and more time trading.
8/ I won't name them but they are keeping you away from your long term profits. They always have the 'best' explanations. Usually followed by charts and pseudoscience.
They speak well, with a lot of confidence and sound knowledgeable to the uninformed.
9/ There's also a case of negative selection. There are so many of them that by pure chance we will witness one or two that make great calls. And they will be loud while the #rekt are quiet.
Our lifespans are probably not long enough to separate investment luck from skill.
10/ Very few strategies will beat dollar cost averaging. Allocate slowly. Wait for stress and buy a bit more. I know investors who bought BTC above 13,000. But also bought below 150.
Follow @matt_odell's advice of #stackingsats and you will be ok in the long term.
11/ source for charts: hodlcalculator.herokuapp.com
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