These periods genuinely excite me.
1. Buying high vs buying low.
2. Survive and prepare.
3. The market, my plan, and Triggers.
1. Buying high vs buying low.
Much more than the “up only” moments where your focus should be selling slowly.
These moments, even if they take time, are where the opportunities arise.
We constantly form these types of market cycle structures. We know them as our bear markets on the higher time frames (2 years), but they also appear within bull cycles in a medium time frame (6-12 months).
Most people fomo in, which happens both on the higher and medium time frame cycles when prices have been up only for a while already because it feels good.
Nobody wants to buy after the crash and the long sideways period while everyone calls it death.
But this is the period where:
> You get a great risk reward.
> You often have a clear invalidation.
> The market has great upside potential after such a big reset.
> Buying at the right time should feel horrible.
> If it feels good, it means you’re probably late.
When prices go up in the cycle's parabolic part, everyone's happy to buy. This is actually the moment to at least slowly start taking profit over time, which feels horrible and stupid at that moment while everyone thinks higher (including yourself).
On the other hand, when things are flattening out after a massive crash, buying feels terrible, as everyone calls it, death.
Buying and Selling at the right moment will never feel good.
But again, regardless of whether this will play out as a medium time frame downtrend cycle OR as a longer higher time frame bear market, these are the moments where the massive crypto upside opportunities appear and when you have to be ready to execute if you want to capitalize on it.
You just have to ensure you have a multi-year outlook.
An example with SUI having a very long (200 days) medium time frame downtrend cycle with all the stages WITHIN a bigger cycle while going down 80%.
SUI was in a higher time frame cycle (colored boxes) while also forming a medium time frame cycle structure after hitting the range highs.
Key entry reasoning for me was:
> The cycle structure and potential stage 3 accumulation forming
> At a key level (range low)
> Entry triggers: Sweep of the HTF range low and cycle stage 3 range and break out of the structure by the higher high, which was in confluence with our HTF range key level (the 0.25/first quarter)
Most people probably jumped in not at the range low but after a big portion of the rally into the highs, to dump or capitulate at stage 2 or 3 of the mini-cycle that followed.
Do we have a full-blown bear cycle right now for Bitcoin and Crypto, or will we form a medium time frame cycle structure before continuation (which can also take months and months)
I don't know, nobody knows. I'm leaning toward a medium time frame cycle and continuation, BUT it's rough enough and potentially much longer, so I'm still playing it defensively.
And It doesn't really matter, as you don't need to predict or guess it rightly right now.
I'm simply waiting for our key levels to reach (previous ATH, for example, on Bitcoin) and let the price a) give me signs of stage 3 sideways accumulation and b) give me a setup to work with. (invalidation for the trend shift thesis)
2. Surviving and Preparing
2.1 Surviving
'Just survive, brothers'
BUT HOW !?
> Move slowly, and don't try to predict the bottom
We're seeing a lot of volatility right now, but often, these moves end up in a transition from steep-down price action into a longer accumulation move on low volume.
Most people will blow themselves up trying to catch the bottom that wasn't exactly the bottom or buy to give up a few weeks/months later while price chops in an accumulation range full of fake outs to the downside.
Instead, let the market show you signs of a bottom first; again, for me, this means A) a transition from the local trend with steep lower lows into more equal lows at a key level, b) a break out of the accumulation range and trend shift and higher high in the local trend, ideally again in confluence with a key level.
Or a whole invalidation of this cycle structure and dip by a reclaim of the lost range above.
Stay patient and move slowly; I'm already waiting for months and not trying to buy dips with my funds reserved for spot positions again.
Here, less is more. The easier times will come again, and you need funds to capitulate on it.
Have a higher time frame and a high probability reversal plan, keep it simple but open to multiple outcomes, and be patient for it to give you a trigger.
> Be able to survive literally
You need to ensure that you will be able to sit out 1 month, 3 months, or even longer than a year. Imagine being mentally able to stay patient and wait for a year just to run out of funds to invest when your plan tells you to.
1. Set enough funds of your portfolio aside in cash
2. Have a basket of funds with only one goal: getting back into the market at the right time
3. If not possible or enough, have a cash flow through whatever a job, trading (but not randomly starting ltf trading lol), or idk.
It doesn't matter as long as you don't sit in a position where you need the market to go up at some point.
2. Prepare
If you didn’t make money in the last 1–2 years, chances are high it was due to one (or more) of these:
1. You didn’t buy when the market was dead, Bitcoin, SOL, and total (altcoin) market caps were near range lows. You bought high, deep into the move.
2. You only played small/mid-caps and had zero exposure to majors like BTC or SOL.
3. You picked underperforming assets or narratives that never showed strength or attention.
Let's go through them and see if we can prepare already to not fall for the same traps again:
1. You didn't buy when the market was dead. You bought when things were ripping up; emotional decision-making.
> Start preparing a plan with clear triggers and invalidation, and understand when, where, and why you want to allocate again. Also, know when your crypto-up thesis gets invalidated.
At the bottom, whenever and wherever that might be, you can call on it that people will be extremely bearish, and you will probably feel the same. You will end up not buying and jumping in late again; having a clear plan where you are open to multiple, even deep, scenarios upfront really helps execute at the right time.
2. You only played small/mid-caps and had zero exposure to majors like BTC or SOL.
> I'm getting flashback vibes to 2022/2023 when I made a similar thread, but it's always the same story. Gambling on an x10-100 through low caps is okay, and I'm doing it myself as well.
Still, you want to have a major (the majority probably) in majors like Bitcoin and Solana, as most often, they will a) move first and b) have higher odds of actually ever going up and not dying. Focus on them in your plan as well and understand what % you want to allocate with them and set aside a portion to 'gamble' on low caps so the temptation to put it all in small/mid caps will be tempered as at least now you have an idea of what allocations you have and where instead of one big mess.
People do hit big runners, but most make their money from simply compounding majors cycle over the cycle.
3. You picked underperforming assets or narratives that never showed strength or attention.
We'll face more and more Altcoin dilution every cycle again than in the previous one. This means that not everything will pump anymore, as in 2017.
Every cycle, it will be more and more important to focus on where the attention and money will flow to. Even if these are not necessarily the sectors you like, or maybe there are other niches you like more. It's not about what you think is great; it's about what the market likes at the moment.
Strength in the downtrend, outperformance during sideways, and early outperformers will give you an idea.
Take note of this.
3. The market, my plan, and Triggers.
Build a plan for where and how to scale in. Expect even fewer bulls than now when the moment comes.
We’re still in the post-high violent dump phase. After this, a dead silent, low-volume phase often follows, and it feels even worse.
People lose faith. They say it's over.
Don’t ape in blindly but also don't lose sight of the opportunity such a reset eventually brings.
Have a trigger. A plan.
My current position & plan:
Spot positions rn:
> Most of my entries were in 2022–2023.
> My portfolio was heavily majors: BTC and SOL.
> Slowly started taking profit at the higher part of the range, range high, and price discovery.
> A good portion is out and will not come back into the market until I believe we’ve seen a proper bear.
> For SOL, I took extra off after we broke the trend post-range high.
> But still a good position is still in spot and I'll hold onto that. I took a good hit here, but it is what it is and once again shows how important it is to always slowly take profit regardless of what you think will be next:
x.com/damskotrades/status/18…
x.com/damskotrades/status/18…
> Mid-cap trades that failed (range low reclaims, etc.) got stopped out, and with those freed funds, I'm happy to take it back into the market again whenever I think there's a high probability of medium-term reversal.
Plan:
> I’ll re-enter when I see a mid-term shift on Bitcoin, the total market cap charts, and majors like Solana.
> Only use the funds I still have on the side within the market (stables), not the profits I took earlier.
Scenarios:
1. Bitcoin reclaims of the lost range above
2. A potential stage 3 bottom or trend shift near a key level like the previous range high. This could also be lower at the 40-50k lows of the range we formed below the ATH.
Pardon me for the ugly chart. But it points out the key levels I'm looking for the medium time frame cycle bottom to form OR the reclaim above us.
3. For Solana: A bottom structure around a key level within the macro range; range low - 0.25 or mid-range
4. Total market caps are the same story; either claim the lost level above or have a low volume sideways period around a key level that breaks up.
This is a structure I would look out for on Solana, for example, but similarly to what I look for on Bitcoin or one of the Total Market cap charts IF we don't get that reclaim of the lost range above.
It is important to understand that I'm not trying to predict where this accumulation bottom will form. It could be at the range low like on the chart above, but maybe we have already arrived at the accumulation zone:
I'll wait for more price action and even partially on a break out (higher high) on that time frame before stepping in.