Bitcoin has been rising for several weeks now. That $16k was supposed to be the end of the world! However, now that many of those present have bought their position, the eternal question may arise… Should we continue buying Bitcoin or should we start selling?
Warning This article does not constitute investment advice or an invitation to invest. It is for information purposes only. You are solely responsible for your trading and investment decisions.
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Continue buying Bitcoin?
Bitcoin is undergoing the classic winter rally in line with market logic, buying in winter and selling before summer.
All resistances are falling, one by one, and others are still above them, of course, but they will certainly be crossed like the others in the months ahead. However, one question remains for most people in the market: should I keep buying bitcoin?
There are two possible answers to this question. Where do you stand on crypto and Bitcoin?
When am I supposed to buy Bitcoin? My position on BTC
- If you’re a bitcoin maximalist then according to your vision the unit of measurement is bitcoin so 1 BTC = 1 BTC. I don’t even know why you’re reading this article! I’m still interested in your feedback on the quality of the latter!
- If you’re a long-term buyer… If you’re in it for the long haul, define what that means for you. If you’re in for 1 or 2 years, is it really long-term? On the other hand, if you’re in it for decades, your ambition is probably to buy Bitcoin. Whatever the price, I can understand your instinct to buy constantly, even at that price.
- If you want to take advantage of cycles and maximize your profits, in that case, you’re there on 2 – 4 years. You have to respect the logic of buying Bitcoin is no longer in a buying position to take full advantage of this cycle since the $30,000 break.
As you can see, it all depends on what you want to do short term. So even more so, buying is out of the question, except perhaps for opportunities to take advantage of the trend and we call it a swing. I’ll let you reread my article to determine your exact profile !
Start selling BTC?
The question has been pertinent for some time now! In fact, if you’ve managed to get to $16,000 or even $2,000, you’re already making more than twice your investment.
The 0 headache method. Shad (= Sell Half At Double) means selling 50% of your investment as soon as the share price has risen x2. And so on! So you’ll sell 50% at x2, 50% at x4, 50% at x8, etc.
BTC / USD resistances
The right technique, just like in a range or short-term trading, is to sell resistances! They are marked in red just above and correspond to areas where there has been strong activity during previous crossings at these price levels.
We can see that we’ve easily crossed the $38k mark and that the next one is at $48k! And we’re not going to lie, it feels great! The problem is, in the event of a new ATH, how do we go about it?
Bitcoin’s psychological figures in dollars
1$, 10$, 100$, 1000$ etc. All round numbers, especially those with digit changes, are psychological numbers. They serve as support and resistance. Why is this? The brain likes round numbers. If you tell yourself to sell at $50,000 and common, nobody says, I’m going to sell at $4,9850 and I’ll be fine, you’d rather sell at $50,000. However, it’s not uncommon not to see the number hit, and so frustrated people sell lower! A good technique is to sell all psychological figures minus a certain percentage.
If you apply this method to Bitcoin, for example, placing orders from here to $200,000 every “X8” can be a good solution. This way, you’ll sell 68, 78, 88, etc. And you’ll be sure to have sold close to the top. We call this a reverse DCA.
In the wake of the latest BTC price hike, I hope I’ve given you enough tips to make you feel comfortable buying bitcoin, selling and apply the same methodology with many cryptocurrencies. Of course, this list isn’t exhaustive, as there are many other methods for both buying and selling, including Fibonacci.
Until we see the weekly results, which is off to a good start, I hope you have a great week!
Entrepreneur & Dad, passionate about cryptocurrencies, I describe for you the technical analysis. Cofounder of Cryptocademia, a free platform to learn all you want/can about blockchain ! Meet you there at https://www.cryptocademia.com
My job: look at charts and interpret them for you.
Beware, I do not know all the truths.