Long-term rating: Overweight
Short Cycle Rating:
Short Cycle Rating:
Lighten up in small-cap cryptocurrencies
Bitcoin waits for accumulation on the right
Lighten up in small-cap cryptocurrencies
The China Internet Finance Association, the China Banking Association, and the China Payment and Clearing Association jointly issued an announcement on preventing virtual currency risks. Affected by this negative regulation, Bitcoin fell again, with a drop of more than 10%. In issue 145, we explained the pros and cons of buying bottoms on the left and buying bottoms on the right, and suggested that investors wait for the bottom to be built and a clear platform on the right appears before considering buying bottoms and grasping the second half of the bull market.
It is true that the left side can grasp more profits, but it also has to bear more risks, that is, the risk that the bottom is not the bottom, and new lows appear one after another, which makes many bottom-hunters doubt life.
If being able to fully grasp a round of trends is compared to an exam, with 100 points from the beginning to the end, then for most of the market, it is easy to go from zero to 60 points in the exam, as long as you don’t chase the rise and fall, If you hold it for a long time, you can make money from the trend.
A few people can rely on fundamental and technical analysis to buy at a lower price and sell at a higher price than others, and score 80-90 points in the test, but if they want to further improve from 80-90 points to 100 points, to achieve a complete bottom-hunting and escape from the top, the difficulty increases exponentially.
Doing a good deal on the right side is an 80-point strategy in the market. By sacrificing a certain amount of profit in exchange for more certainty, taking small losses and making big money is an account that is easy to settle after thinking clearly. Driven by the stock market, there will always be people who fantasize about copying at the lowest point and selling at the highest point.
We looked back at the historical data and found that in each cycle, if investors choose to hold firmly, they can get 432 times the return. If investors can only eat fish and not fish before the sharp correction in each cycle Head fish tail, that is, do not pursue bottom-hunting and buy at the lowest point, escape from the top and do not sell at the highest point, the overall return of investors is 39489 times, which is 90 times that of firm holding. If investors do not perform well, they only enjoy 60% of the return in each cycle, and they can achieve 27,586 times the return, which is 63 times the firm holding.
Bitcoin is still in a downward trend. Although Bitcoin has signs of bottoming at the 30-minute level, there is no answer at the moment whether it will rebound or reverse after the bottom. A question that many investors worry about is whether it will be too late to buy if it appears on the right side, or will they be short-lived?
The turning point of a market and the sharp rise after the turning point will not end easily. It needs time and space, just like fragrant wine needs fermented wine, and juicy fruits need to grow. Time is definitely sufficient. We take March 2020 Take the big bottom on the 12th and the market turning point in September 2020 as examples.
