I officially became a full-time crypto analyst in 2020, but what truly allowed me to survive the cycle was the bloodbath of 2018. At that time, Bitcoin crashed from $20,000 to over $3,000, and my $80,000 principal was halved to $40,000. One morning, I saw someone in the group shouting 'Let's go to zero, I'm tired,' and instead, I suddenly woke up—extreme panic is the starting point of certain opportunities.
1. Why did I dare to catch the falling knife at $3,200?
In those three days, I did one thing: sifted through historical data to find signals of 'not falling'.
The fear index was nailed in the extreme zone: at that time, the 'Crypto Fear and Greed Index' had been below 20 for 15 consecutive days. This indicator has a rule: historically, whenever it falls below 20, there will be a rebound within three months. What others saw was despair; what I saw was a golden pit.
Institutions secretly buy the bottom: when Grayscale BTC Trust was publishing its holdings weekly, I noticed it had been increasing its positions against the trend for three consecutive weeks. Large funds are smarter than retail investors; they often don't speak when accumulating, but the data doesn't lie.
Technical analysis shows a 'double bottom + volume increase': the candlestick chart formed a W bottom around $3000, with the key being that the volume on the second bottom suddenly tripled—indicating real capital is entering. Support without volume is a paper tiger; only those with volume are real signals.
With these three signals overlapping, I decided to split the remaining $40,000 into two batches: buy half at $3200, and buy the other half if it falls below $3000. Discipline is greater than intuition; I never go all in.
2. The core of making money in a bear market: don't compete with the market on who is crazier.
Many people fail while trying to catch the bottom halfway up the mountain because they always want to make a quick profit. But those who survive in a bear market rely on patience and strategy.
The fear index acts as a 'reverse compass': below 20 is when the market is crying out, at which point don't cry along; open your wallet. Above 80 is a signal of euphoria; it's time to consider taking profits.
Track institutional positions: the holdings of companies like Grayscale and MicroStrategy are barometers. Continuous accumulation indicates long-term optimism, while reductions signal caution.
Technical patterns must come with volume: patterns like double bottoms and head-and-shoulders bottoms are meaningless if the trading volume doesn't increase. The traces of capital entering are the truth.
When BTC rose to $13,000 in 2019, I sold in batches, turning $40,000 into $640,000. This isn't magic; it’s just that while others were cutting losses, I picked up bargains with discipline.
3. A bear market is not the end; it is a touchstone for smart people.
In these eight years, I've seen too many people: feeling triumphant when chasing highs in a bull market, and cursing when cutting losses in a bear market. But the truth is—a bear market is the market giving you discounts and money, but most people are afraid to reach out.
The biggest difference between me now and in 2018 is: I'm no longer swayed by emotions. When the market is in panic, I check the data; while others shout about going to zero, I'm reviewing my holdings.
If you are also experiencing a low point, remember: be patient for signals, act decisively, but maintain steady positions. Those who survive in a bear market will not fare poorly in the next bull market.
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