Should you buy dipping sauce?Bitcoin prices start from approximately… Every Saturday | Capital | June 2021
Bitcoin price It plummeted from approximately US$60,000 to US$42,300, and fell 30% from May 10 to May 18. When I stare at the chart, I am observing the development of the whole thing.
I am ecstatic!
Don’t worry, this is not my sadism after the market crash, I just like to buy on dips, especially after a massive bull market that doubled investment overnight.
I did what any sane person would do, and I bought it for $42,300.
Look, the crash continues.
The price of Bitcoin fell again by 30% to $29,900. To say the least, my portfolio is red and has shrunk dramatically. I break even on some, and even profit on others, but in most cases, I’m still underwater.
As the price of Bitcoin tries to break through the $42,000 resistance level, I have seen many cryptocurrency gurus, traders, and YouTube users posting about how to buy on dips.
This is what prompted me to write this article.
why? Because you don’t know whether the price of Bitcoin has fallen or whether it will go lower. If it continues the bull market, you can claim influence on Twitter by posting your screenshots. If not, you may complain and regret.
Don’t get me wrong, even if I don’t know if BTC has crashed. We are in the same boat.
Bitcoin prices have been fluctuating since the fall, and even the May 23 crash is suitable for this integration phase. The rapid surge from US$31,000 to US$41,330 in the past week has caused many retail investors to buy at the top of the range.
This 33% surge and nearly two 10% retracements were enough to flip the Fear and Greed Index from 13 (frightening) to 38 (almost neutral). This dramatic shift in small gains shows that investors are panicking.
This is a recent excerpt article,
Obviously, BTC tends to be bearish, but after falling into the buy zone, the price will fluctuate slightly to $42,267, ranging from $32,565 to $33,837.
What happens at $42,267 (the peak of the right shoulder and the 200-day moving average) will be crucial.
This will be a test of market sentiment between bulls and bears or investors and whether they are afraid and concealed or ready to join.
If you, the reader, one thing will take away from this article is:
From 33,186 US dollars rose 27% to 42,267 US dollars.
Although the rebound mentioned in that article has already appeared, I want to direct users’ attention to something more important, which is the 200-day moving average (MA) of $42,820.
Although the Bitcoin price has not yet tested the 200-DMA, anything can happen here.
- The BTC price may fall to 42,000 USD, go down and complete the right shoulder of the head and shoulders (HNS) pattern, which is expected to fall 53% to 13,876 USD.
- Bitcoin price may not retest $42,000, but continue to fall, which is the current situation. According to HNS settings, this action will still cause 53% of crashes.
- Or BTC may sweep through the May 19 low at a price of $29,990, which may attract many traders to go short, believing that the HNS technical form is working, but it will only reverse the rebound and successfully break through the $42,000 and 200-DMA $42,820.
Any of the above situations may happen, or the price of Bitcoin may take a completely different path, which is the focus of this article.
No, I, YouTubers, or encryption experts on Twitter have no idea what will happen. Therefore, it is not in anyone’s best interest to invest blindly to keep your humble altcoin bag for years.
Therefore, don’t go all-in without proper planning.
I learned this lesson the hard way, and I think I’m on the path of becoming “risk-averse.”
So, this is what I am going to do.
- reduce risk: Don’t invest. Most altcoins look bad and are highly correlated with BTC. I would rather lose my profit than my capital.
- Calculate the risk: If I want to invest, I will wait for confirmation, that is, the 200-DMA $42,820 and 50-DMA $43,686 on the daily chart will break and retest.
- This will allow me to invest in altcoins, but with a strict stop loss setting, which varies according to a person’s risk profile.
- My risk appetite is between 0.5% and 1%. After we get confirmation, I will tend to increase my position.
3. The biggest risk: Invest in all, then sit down. Of course, this only applies to the “degeneration” of a strong stomach, which I am not.
Disclaimer: This is not financial/investment advice.