Time To Buy Bitcoin?

Wall street traders know it, day traders know it, and even Pokemon traders know it. So why do so many people not follow the simplest investment advice of buy low, sell high? The short answer is simple. People panic. And when they panic, they do irrational things. Despite the fact that crypto is intended to be a disruptive technology, its story has played out much the same way as other markets. Unsophisticated investors rushed in on the December and January highs and then got burned when bitcoin crashed. Sentiment now is very negative and the market bearish. But one question remains. Should you get in now while the price is relatively low or avoid bitcoin like the plague? We spoke to experts Ronnie Moass, Tom Lee, Naim Aslam and Monte Greenspan to explain the panic and asked them if now is a good time to buy bitcoin and even go from a complete no coiner to a hard day.

So first of all, we have to take this into proportion. What we see here is very small so far, especially in comparison to what we see here. So we're seeing a little bit of volatility creep back into the market. But you know, we've become, we've, we've grown complacent. In all of that time when bitcoin was, was trading flat, why did it, why did the volatility come back in? So basically we had a breakout of the level of $6,000 per coin. That level had been building up for quite a, quite a while and providing support to the market. And once it was broken, there was a chain reaction of stop loss levels that had gotten triggered basically all at once. And that, that type of price action has a way of perpetuating. Fear starts building up. And then people say, oh it's because of the bitcoin cash hard fork. Oh, it's because of the sec. Oh, it's because of tether. All of those stories add to the fear. But really what we're seeing is a simple technical breakout to the downside and not a break of the crypto industry, which is very strong at the moment.

The stock market is also getting hit really, really hard. Half of the names on The S&P 500 are down between 25 and 50% since January. So it isn't only the crypto market that's getting hit, it's the stock market also, as far as the crypto market goes, we've been down this road before. We have parabolic moves and 80% corrections every couple of years. And every time we have a parabolic move, we knock out the high from the previous cycle. I don't think the parabolic move that I am expecting next year will be any different. If you look back on the history of crypto and the stock market, people that sold at the bottom of a crash ended up regretting it shortly thereafter. People jumped out of their, jumped off of bridges in 1929 when the stock market crashed. They did the same thing in 1987-2002 and 2008. The people that bought that panic did very, very well for themselves. And I believe anybody that buys this panic in the crypto market is going to do very well for themselves. I can't justify the gold market at seven and a half trillion dollars, trading at 100 times where Bitcoin is today and 60 times what the total crypto market cap is today. We are in the beginning of this game. We are in a price discovery phase. There are weak hands getting shaken out. People that have never been in a situation like this before acting as if bitcoin is going to zero. And I don't think that's happening.

We have two different major factors which is playing into the market. Number one is a euro regulatory issue. And that is a huge one. Everyone knows that because regulators are not friendly. And as long as they maintain the same stance, then we won't gonna say we won't be able to see that huge rally for bitcoin. And we all know that. And then the second element that I've said many times in any of the articles that I've done or any of the public speakings or on the television, is that the main reason that bitcoin or bitcoin cash or anything of that.

Nature is being used is because there's.

A limited supply of. But now we have this element of one fork, another fork and another fork. Remember, bitcoin cash is a fork of a bitcoin. Now we have a fork coming out of a bitcoin cash. We continue to increase the supply. This is not really a good sign for the industry when you are going out there and then you're saying, you know what, the entire supply is actually limited to this amount. But then you create another fork and then you create another fork. I think this goes against the major core elements. The core values of it.

Global markets are down more than 10% between October to November. And while crypto actually initially had negative correlation, in the last six weeks it's flipped to one of the highest levels of correlation to global markets. So I think the macro meltdown actually finally hit the crypto market. And I think that contributed to essentially Panic selling.

I believe very strongly that the market, the crypto market recently has been driven a lot by the technicals rather than the fundamentals. So, meaning what we're seeing is price action, which is influencing sentiment and not what's going on in the news.

I think the key psychological levels are breaking like we've gone below the 6,000, 5,000, 4,000. Now the big one is at 3,000 and after that is 2,500. But I think we are not far off from finding a bottom. I think this is where you start preparing yourself that, okay, now I'm start rubbing your hands that everything is so cheap. And then I'm about to jump into the industry.

I believe that the smart people bought Bitcoin at 9,000, 8,000, 7,000, 6,000, 5,000 and 4,000. So their break even point on the averaging down the last few months is somewhere around 6, $7,000. If Bitcoin goes back to 20,000, they tripled their money. Okay? And that is usually what happens when markets collapse, just like what happened in the stock market 10 years ago. People that added to the positions that they had conviction in when the market was going down and capitulating have done very, very well. They made 300, 400% on their money in 10 years. And the people that sold in 2008 missed a 300, 400% move. And on top of that, they got out at a loss. The problem with individuals is they like to buy high and sell low. When Bitcoin was at $20,000 in January, 2500 people signed up for my service at the top of the market at 4,000. Nobody wants my service. You know when they will call me back? When we go back to $20,000 on Bitcoin, they will want to sign up for my service again. And that is exactly when the people at the top of the market will dump their bitcoin on you. And people don't learn from history. History repeats itself. And if you look back at financial market history going back 100 years, the time that people made the most money is when markets crashed and the smart people took advantage of an overreaction and emotional selling that we are seeing right now. Well, I can't make a general statement like that. What you need to understand, first of all, I'm not always right, okay? I could be wrong on this. That coin could go to $15 six weeks from now. If somebody wants a second opinion from someone who takes the opposite side of the argument as I'm taking, they are more than welcome to listen to someone else but the way I see it, I mean, I know a company that is spending $100 million on mining rigs right now. I think they know where Bitcoin is going better than the average person who is selling right now.

So first of all, relax. You know, making money with investments is a waiting game more than anything. And it's the same as same as in the stock markets and it's the same as in any other type of investment. You don't make money when you open or close trades. You make money while you wait.

I think people need to be patient. But I think one of the most important things that we advise our clients is, you know, crypto as an investment should really be, you know, 1 to 2% of their allocation. So that, number one, they're not worrying about it every day. But Also that's that 2% could become 50% in a decade. You know, it can grow dramatically. I think the other thing is to realize that some of the crypto projects are probably hopeless. But things like Bitcoin and Ethereum I think have long term or ripple, have xrp, have staying power. And these are the ones where unless you think the protocol is actually completely broken, you're seeing price distortion caused by panic selling. Well, this is the simple math of long term investing, that if you look at the equity markets, the only time you actually earn better than historical average returns. So the stock market has returned roughly 7% a year. The only times you earn better than 7% is when you buy in a bear market. So for instance, if you bought the S And P in October 2008 at 800, it still went down another 200 points for six months. Right. So in the short term you lost money. But S and P is now at 2800. A lot of people waited till the S and p went to 1600, which was a new high, to buy it. They made a lot less money than the person who bought at 800. So to me, crypto is exactly this moment that bitcoin may have downside in the near term. But does this change the fact that it's still the earliest days of crypto and it's about to become an emerging asset class? Well, those are going to create much higher prices.

So the fact that we've had some volatility recently, I believe that the institutional players, the more experienced people in investments are actually coming in right now and seeing this as an excellent opportunity to, to buy in at cheaper levels.

Whenever there's a panic of this momentum, it is almost certain that we are close enough to bottom. And then this is what I have said before as well. So we are very close to find that bottom, wherever that bottom lies. And one thing is for sure, only few less than 1% would be able to catch that bottom. But I think now is the point where you start preparing yourself and being a position to start participating.

Bitcoin has gone through various boom and bust cycles over the course of its short history. And a lot of the time we see bull cycles where we see the market going up by 1,000%, 10,000%, you know, in a single year or a single, or even within a few months. And then after that type of growth, you generally need to see a pullback. As you mentioned, during those, during those periods of growth you do get a lot of newcomers into the market. And then after that, during the, during the retracement and then the relaxation period, this is an excellent time for people to up their knowledge, to learn more about the industry, learn more about crypto assets, learn more about how things work, and then during the next great rush, they'll actually become the experts and be able to teach all of the newcomers at that time. So this is what we've seen play out many times in the past and very likely that can continue until we reach full adoption.

I think bitcoin is going to do very well next year. So I think it's. If anyone is even worried that bitcoin could go down in the next few months and it's possible, it doesn't change the fact that adoption is going to grow and that we have institutional investors that will have opportunities to invest. And I think that you want to be in front of that investment wave. So I think 2019 is going to be a great year for bitcoin.

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Sam.