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Alright, guys. So let's talk here about our philosophy No. 2.
Now, yesterday, if you tuned in, we talked about our first philosophy,
which, of course, is developing a long-term mindset.
So, as we move through these,
you have to always remember,
anything that involves keeping a long-term mindset,
which we talked about the subsets of that yesterday,
that's all going to apply to every other philosophy we look at.
So, you know, keeping a long-term mindset is what you have to do throughout,
you know, trading to win,
but it's not the only thing.
So, you also have to do our No. 2 philosophy,
which our No. 2 philosophy is understand market behavior.
Well, you might have seen the market psychology cheat sheet.
It shows the different stages of a market cycle---
anger, panic, euphoria, disbelief.
There's tons of other things involved there.
But there are more things than just understanding that
that you have to do when it comes to crypto and Bitcoin.
So, No. 1, when it comes to understanding market behavior,
you have to get to know the Bitcoin cycles.
Now, people are going to argue and they're going to say,
"Well, you know, this cycle is invalid," or, you know, "They're all different."
Look.
It's starting to look like
this cycle over the last four years
is almost exactly like the one before
with only one exception, which is a double top.
Okay?
$69K, at this point, very easily could have been the top of this market cycle.
I think a lot of people are waking up to that fact,
with all the stuff that's going on with Russia and Ukraine,
the Fed, you know, the Fed hiking rates,
all this stuff, the whole nine yards.
I think people are realizing like,
hey, we said for years, the top would be at the end of September.
It's the beginning of November. We might have been pretty close.
We were just too confused by the number.
We kept thinking it was going to get to $100K.
It didn't even get close. It topped out at 69.
So, the point here being is this.
The Bitcoin cycles,
it doesn't matter what the behavior is from cycle to cycle.
They all share one thing in common, okay?
The center of the cycles are the Bitcoin halvings.
The next one is going to be in, you know, probably, you know, March to April of 2024.
The last one was in May, May 11 of 2020.
And, you know, leading up to that event,
people were really excited about what that would do for the price.
And it did lead to a rally.
So, we're, of course, going to talk a lot more about Bitcoin cycles.
We still believe in the Bitcoin cycles, but the halvings are not going to change.
Now, what do these halvings do?
Well, they halve the number--
they halve the number of block rewards.
Right now, it's at 6.25.
So the next one, it'll drop down to, you know, 3.125, or whatever the case may be.
But the fact is,
is that this still is going to happen every approximately four years
or exactly 210,000 blocks.
What this does is this cuts the production of Bitcoin in half.
Okay?
So, right now, there's about 900 Bitcoin being mined per day on average.
In 2024, it'll move down to 450.
And then it'll go down to 225.
And you really start understanding
the compound effect of this halving and the cut in production.
This is not going to change.
This creates, you know, buying pressure at different points
and selling pressure at different points for miners.
Miners are the biggest whales out there.
Don't be confused by that.
Many of the top 100 Bitcoin wallets are early miners.
That's how they got, you know, so loaded.
A lot of people in Russia,
you know, people behind Cointelegraph for instance.
But, you know, the thing you've got to keep in mind here is this is not going to change.
These cycles are going to be important.
You have-- it is fundamental.
Bitcoin drives the entire crypto market.
You have to understand the Bitcoin cycle and the general movements that it generates.
That-- it really guides all of our investing.
That's why, you know, usually in the middle of a bear market,
you know, you can kind of have a good sense of when it should approximately be,
top of the market, when it should approximately be,
and even if this totally changes,
the fact is,
the halving event is still going to occur,
and it will still have an effect on the markets.
So that is No. 1.
No. 2,
do the opposite.
Do the opposite of the masses.
Retail.
What is the difference between retail and institutions?
Retail traders are people like you and me.
They just trade.
They make buys.
They use Coinbase.
They use regular exchanges.
I'm not an institution.
You're not an institution.
We are not a bank.
We are just working with our own money.
When you're only working with your own money,
you're considered to be a retail trader. Okay?
Retail traders generally lose.
Not all retail traders, of course.
But the vast majority.
That's why that market psychology cheat sheet works.
Because they generally lose.
What do we see?
We see fear and FOMO on the markets.
When there's fear and FUD,
that means there is a negative sentiment towards crypto,
and prices are usually dropping.
Those are usually good times to buy dips
and accumulate positions.
On the opposite, with FOMO, fear of missing out,
when you see a price going way up,
there's this instinctual feeling of like,
"Man, this could go to the moon! I need to get it on this."
And sometimes we see projects like Sandbox or Solana that seem to defy that rule.
They just keep going up.
You know, they went up, you know, very consistently
for, you know, a large portion of the bull run.
Dogecoin, Shiba---
these are other ones that had those same kind of massive runs.
They defy-- but in general,
most of your crypto projects are going to hit ceilings very quickly and then retrace, okay?
You have to learn how to manage that fear and FOMO
and do the opposite.
When people are FOMO'ing in,
that's a time to sell.
So you have to do the opposite of the masses.
You have to get to know the Bitcoin cycles.
The third thing is that
you have to understand general trading principles.
Okay?
It doesn't mean you have to be a trader.
We're going to get more into trading when we talk about becoming an expert.
If that's the track you want to get on,
we, of course, got Frankie Candles.
You guys can go check him out on YouTube.
He does a phenomenal job.
You know, part of the BitBoy Crypto team.
But the fact is you have to understand general trading principles.
What I mean by that is,
here's a really great one. Okay?
Here's a really great one.
And it kind of goes back to No. 2 in a sense.
Buy in the red.
Sell in the green.
You want to take profits when you're up,
and you want to accumulate when prices are down.
Like, that is a very simple trading principle
that's very, very, very easy to understand.
Knowing whether we're in a general downtrend or a general uptrend.
These are things that are important to know.
So we're going to be looking at some of these general trading principles.
You know, you need to understand the difference between swing trading,
day trading and HODLing.
HODLing is a trading principle really.
Understanding what HODLing means--
we call it HODLing.
It comes from a typo from a Bitcoin talk forum back in, I think, 2012 or 2013.
And the fact is,
it just means to hold.
And, of course, we are very famous for saying HODLing is a lazy strategy.
It is to an extent.
Take profits along the way.
And then when prices go down, you have money on the sidelines to buy.
That's really what we were saying.
Of course, we would have liked to have called the exact top.
But we didn't. We were wrong.
We missed it.
And so it's not like we dumped a bunch of Bitcoin and made a ton of money at the top.
We wish we would have done that.
That should be your goal.
You should want to dump Bitcoin at tops and re-accumulate.
But for some people, HODLing is just a better strategy
because you don't want to necessarily pay attention to the market 24/7.
But if you're watching this video, then you're in crypto,
then you do have, you know, probably the intelligence and the experience
to understand that there are advantages of taking profits along the way.
A good general trading principle?
Taking profits.
Taking profits is another example.
Learning what dollar-cost averaging is.
How you can do that.
We'll talk about that in a video.
So there you go.
That is how you understand market behavior.
The three most important things,
you've got to get to know the Bitcoin cycles,
you have to do the opposite of the masses,
and you have to understand general trading principles or trading strategies.
I think that these are three things that we're going to really focus on.
I think when you really understand all this,
you're really going to do well in crypto.
Alright, guys. That's all I got.
Be blessed.
BitBoy out.