Friday, December 22, 2017

BREAKING: Bitcoin Crashes -35% in less than a week!


OH NOOOOOOO

THE SKY IS FALLING

THE BUBBLE IS BURSTING

And I'm buying the dip, ehehe.

Why?

Because Bitcoin "crashes" every quarter. And its totally and perfectly normal behaviour. As per my previous post, let me update it a bit:

Bitcoin Crashes
Jun 16: -41%
Jan 17: -37%
Mar 17: -31%
May 17: -33%
Jun 17: -39%
Aug 17: -20%
Sep 17: -40% 
Dec 17: -35% (as of now)

Bitcoin Prices
30 Jun 16: $636
31 Jan 17: $970
28 Mar 17: $1,195
31 May 17: $2,303
30 Jun 17: $2,455
31 Aug 17: $4,743
30 Sep 17: $4,388
31 Dec 17: ?

Can it drop further? Of course it can. Another 15% drop from where we currently are sitting at can be totally expected. Deeper than that though would be rather interesting and get my attention. Anyway, I will continue buying it as we go lower and lower. Because I'm just stupid that way. 


Please for the love of your own money, DO NOT PLAY WITH CRYPTOS IF YOU DO NOT UNDERSTAND IT.

16 comments:

  1. Hi gmgh, thats quite good insight. How much do you think i should allocate for dollar cost averaging(aka buy the dip)?

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    Replies
    1. Hi Anon,

      You seem confused what is DCA and BTD.

      DCA = Fixed amount of fresh capital injections at fixed periods, regardless of price. (I would recommend value averaging instead, but that is much more complex to execute, but the returns are significantly better)

      BTD = See extreme down days, inject capital ad-hoc to take advantage of the situation.

      This was/is a BTD situation.

      Delete
  2. What are the figures for Oct and Nov?

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    Replies
    1. I guess only, but some one trader i read him, he said 32689 is the top for this round. So far i follow his forcast, quite chun, I would be rather anonymous. Pls do your homework, crypto is dangerous. LOL

      Delete
  3. Hi GMGH, thanks for lending strength with this post amidst the fear. Prices have gone back up this morning.

    Your blog has inspired many including myself to dip into cryptocurrency.

    I’m a late comer, started a Coinbase account 3 weeks back with a weekly limit of $250. Can only buy and cannot sell, buy using credit card as bank credits are not available. I buy little bit on ethereum and litecoin every week, it’s little, but it gets me started and the limit helps me managed my fear and greed. As a Singaporean living in Australia, my sg passport name in full did not match my other ID docs which resulted in me not being able to register for GDAX. Transfer cost from my Coinbase will be high to buy alt coins at other exchanges. Exploring other platforms like btc market but quoted price is high there. Still waiting for instructions from quoine exchange. Nevertheless, will keep trying, exploring and buying weekly :)

    Nick: ceiling design ~ I love what I see every morning when I open my eyes :)

    ReplyDelete
    Replies
    1. Hi Anon,

      Although the price statistics are interesting, the best thing to help you hodl stronk is to have a very clear and deep understanding of the cryptos that you are in and why they are worth it as investments.

      I always and still do recommend Gemini. Don't bother with any exchanges (other than Coinbase) that deal in SGD. The spreads are high are the liquidity is non-existent. I heard good things about Kraken until recently when their servers are unable to handle the load. Coinbase limits increase over time, and that is of course the easiest way to get into cryptos. While waiting for your limits to increase, read more and study more!

      For full disclosure, I have exited 99% of my LTC position after Charlie Lee sold off his entire stack.

      Delete
    2. Hi GMGH, thanks for the advise. Gemini is not available for Australia too :(
      I asked my family to send me stuff so hopefully I can set up Sg accounts.

      I find Charlie Lee’s declaration of sale strange. He didn’t have to do it unlike in a stock market. In fact, I think his Twitter said he sold most cryptocurrency he owned and not just LTC. This came 1-2 days before the crash? What if he had sold LTC at $400 and quietly bought back at $200 during the crash?

      Yeah, i’m reading up more, trying to understand more while waiting for my accounts to get sorted :)

      Merry Xmas to you!

      Delete
    3. Hi Anon,

      I would imagine the best scenario is to get a trusted and also somewhat knowledgeable / interested family member with a DBS account to apply for Gemini. However, I last heard is that they are swamped like crazy with applicants!

      If he had kept a token sum of 100/1000 LTC and had sold the rest, I would have still stuck with the cause. LTC is really fast and cheap to transfer around, which is essential when BTC costs $20-30 USD for a transfer and the ETH network is so prone to backlogs. While ETH is handling things well as of now, I expect things to get significantly worse next year once a few dapps go online and start seriously competiting with trivial transactions. On the bright side, they do have scaling solutions and I have to say, it's probably one of the few cryptos that still excite me when I look at its development!

      Merry Cryptmas to you!

      Delete
  4. Do you guys think that a bigger correction >60% will come. Btc will be here to stay but what about the big dips as more people are drawn in, there has been warnings it can be worse than GFC. Would like your opinion on how to handle/hedge our coin portfolios? So we can remain strong hands! :)

    ReplyDelete
    Replies
    1. Hi Anon,

      I think a big correction is definitely in the cards. Especially if you consider how fast the recent run up was and how virtually every single people who own BTC before the start of Dec are swimming in massive profits.

      It is not fair to use the GFC as a comparison. Stocks are stocks. Crypto is crypto.

      My only recommendation to hedge is using Gemini to trade out BTC/ETH for actual USD instead of using Tethers which are on many exchanges. This bounce of the dip low is also a good chance to evaluate your positions and get rid of shitcoins.

      The next best solution is to just go away from the markets and focus on other things in life until 2022, haha.

      Delete
    2. Thanks for the advice! Really good insights. I mentioned GFC because a few 'experts' are warning that this could be the biggest bubble in our lifetime. And looking at the drops in the past, dips of 40-50% or more in portfolio value in a matter of days, makes the subprime bubble look like a walk in the park lol. I do agree to hodl but why do you mention 2022, do you mean cashing out out cryptos then?

      Delete
    3. Unfortunately, I have met extremely few "financial experts" who really understand the technology and the implications of Bitcoin and blockchain technology.

      Crypto will always crash, but it's just another day as usual.

      I predict that by 2022 crypto would have gone totally mainstream and the supernormal profits that can be had now will no longer be easily obtained in the future.

      Delete
  5. 40% drop in 1 week in cryptos is merely like 5%-10% drop in 1 month for stocks.

    It's normal (like eating & shitting) ... and will be normal many many times in the future.

    To remain strong hands, you need either to maintain 50% cash or have good-paying iron ricebowl job, or both.

    By maintaining 50% cash allocation (or whatever amount lets you sleep at night), this means regular rebalancing & taking off some profits from cryptos when they have cheong-ed & buying more cryptos when price drops (like now).

    Sooner or later, there will be 80%-95% drop in cryptos. No escaping it. How to survive with the remaining good cryptos is the question.

    ReplyDelete
    Replies
    1. Hi Anon,

      I disagree about a 80-95% drop. In fact, I think that as the market matures, especially in 2018 with heavy institutional money coming in, the absolute drawdowns will get shallower and shallower. Up to -70% is the limit I would imagine, but of course it is largely dependent on what caused the high and how fast it reached there.

      It goes without saying, that REGARDLESS OF INVESTMENT TYPE, you should not be invested with any sort of money that you will need any time soon. Doesn't matter if its crypto or stocks.

      About maintaining a cash allocation and rebalancing, that comes down to individual strategy, portfolio and risk management goals and objectives. I personally let my cryptos ride because this market is so ridiculously profitable that I don't even need to trade it to make supernormal profits.

      Delete
  6. Best time to buy now.

    Wondering where you guys are trading your SGD for BTC / ETH now that Coinhako is more or less defunct.

    Cheers,
    Sean

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    Replies
    1. Hi Sean,

      I would not say that it is the best time to buy now.
      However, it is definitely better now than last week. A lot of people had FOMO that they will miss the BTC sub 20k boat and the ETH sub 1k boat. Buying on FOMO doesn't usually work out.

      I use Gemini and I have no issues with them.

      Delete

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