This was going to be part of my response to a recent contribution by Kyle Heinemann, a contributor to The Silver Chartist but once again I felt it was too long and decided to post it here in my own little space;
“Thanks both to Kyle and the questions posed by members that contributed to another very rich presentation. So many new valuable points learned, but reciting one about crypto market sentiment during the peak of the FTX collapse,
‘Buy when there is blood on the streets.’
Despite my recent entrance into the investing space I can already make claim to having experienced a full blown bull market rally and somewhat of an ongoing bear market cycle and it is exactly as you, David and Steve continually highlight and emphasize to us…..successful investing is primarily about
‘managing our emotions.‘
When Bitcoin had reached its all time highs of $64,000 back in November 2021, selling and taking profits was the last thing on the average retail investors mind, in the very same way as the thought of buying any form of crypto during the height of that Sam Bankman-Fried FTX collapse in November 2022 with Bitcoin at an approximately $16,000 low.
As you rightly stated;
‘It’s easy to say but exceptionally hard to do’.
So I think I understand even more so your unorthodox teaching methods in endeavoring to train and prepare us for what’s coming, according to your ‘melt up‘ thesis. It’s going to be even more emotionally intense and only the cool blooded, emotionally stable investors will survive.”
However this recent short term positive gain price action does not necessarily mean anything in itself. In hindsight looking back two months, yes it was an ideal buying opportunity but how will we view the gained or missed opportunity looking back several months from now? If we are to believe the forecast ahead it’s going to make the FTX collapse look like a corner shop grocery store bankruptcy in comparison.
Maybe this recent episode is a mere foretaste of what’s to come where you get to experience what market sentiment does to your investing strategy and behavior.
In both bear and bull markets it should always be about doing your own due diligence, risk management, risk reward ratios, investing only what you can afford to lose and managing your emotions.
If you want to learn more about Kyle’s imminent ‘melt up’ thesis, and how it relates and compares to the other contributors’ forecasts and strategies such as David Brady, Steve Penny and Jeff Clark then come over to The Silver Chartist and subscribe to Steve Pennies newsletter.
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