Alexander Lorenzo admits he misread the crypto bull market and argues traders obsess over predictions instead of risk management. He shows how to profit from declines by averaging down: buy $1,000 at $100, then $2,000 at $80, then $4,000 at $60 to hit a $70 average entry. This discipline has sustained him through three bear cycles.
I have been really wrong about the crypto bull market, but that is the beauty of trading. You can be very wrong and very profitable. Let me explain. I am taking personal accountability. I have not been pinpoint accurate, but that is the beauty again of risk management and trading. I want you to think about any decision you've ever made in your life and try to project in the future. Think about your schedule that you spent hours and hours to create. Only to find out you didn't follow even 10% of it. Humans are not good at projecting in the future. So what I'm going to do is I'm going to give you the exact numbers, the exact strategy, the exact thing that I gave my dad for risk management because he knows nothing about crypto at all, and the exact thing that I use as a professional trader to stay profitable through the last 3 bear markets that I experienced. I keep using this strategy over and over again. It works, guys. It works. And it's unfortunate because I've made these risk management videos in the past, but because people only like predictions and that's all they look at, Those videos go viral, but then the hardcore risk management videos that actually lead to real profitability, nobody watches. It's funny because I actually had a person ask me about Ethereum if the price is going to continue to go down, and I was like, look, bro, you're asking me how to properly land a hook with getting in the ring with a professional boxer and you have no experience. There's a whole bunch of background work that you need to do to become consistently profitable to win that boxing match, okay? That's what a lot of people want. They want the exact answer, but they're missing the entire picture. So let me just be clear with everybody watching this video: the market going down Is not a bug, is a feature in my strategy. When it goes down, I literally make more money. Let me show you the math. Let's say that you've done research and you want to buy a coin, right? And you buy it at $100 with $1,000. So you put $1,000 in, the price of the coin's $100, price drops to $80, then you put $2,000, the price of the coin drops to $60, and then you put $4,000. You have to see what happened, right? Let's go over the numbers. You put $1,000 in at $100, you put $2,000 in at $80, and $4,000 in at $60. Okay. Okay. That means that your average entry price is around $70. Every time you increase your buy size as it goes down, you drop your average entry price on the entirety of the decision. That means you do not need to go back to $100 for you to break even and turn a profit. It only needs to go back to $70. And the current price with the $4,000 buy is at $60. So literally As the market goes down, the only thing that's really happening is it's giving you a bigger and bigger opportunity to buy low. And then when the market goes back up, you make up for all the losses and then some. It's literally simple math. And the only way this doesn't work out, the way, the way that you actually lose potential of profit, is actually when the market goes up. When the market goes up, the numbers reflect, but your potential to make more money goes down. That's the purpose of of risk management. And so when the market comes back, all that happened is the fact that I just increased my buy size and went more aggressive at cheaper prices. Market comes back, this is how I remain profitable. This is how I've been able to basically be full-time crypto and make millions of dollars over the past 3 bear cycles. It happens every time, okay? You have to catch this. I do not give up. Do you?
