Hello Fellow Hodlums! This post will outline my humane approach to investing in Bitcoin. Consider how much money you can afford to completely lose. Calculate rough percentages and follow my lead. Please read disclosure at the bottom of the post.
Technical perspective: 15,000 is our closest area to consider buying. Round numbers and Fib levels support us here. I will be buying 25% of what I feel comfortable losing at 15,000.
Next is 13,000. This level is rather substantial, as price has pivoted here before. I'll buy 25% and would not be surprised if price reverses here.
If by a Christmas miracle we get below 13, the 50% fib level is between 10,000 and 11,500. If price gets to this point, the 50% fib level probably will not hold. But I'll make another 20% buy at 11,500.
At 10,000 I will be one happy camper. It is very unlikely we ever see price below 10,000 again. I will put 25% to work in anticipation of not going lower.
In the depth of disaster, at 8900 when the community is in disarray and the complacent declare BTC a fraud, I will buy my last 10%.
With these super conservative entries exposed, let me say I believe in Bitcoin. I believe long term BTCUSD valuation is 50,000 or greater. However that valuation will take time! I believe it will require a modern acceptance of bitcoin both as a means of a purely free currency and a hold of value. Similar to how we treat Gold. There is no doubt the ways we do business in the next 10 years will be blockchain/bitcoin related.
But lets be honest traders, speculation has gotten the best of price recently. Short term there are way too many roadblocks to believe price will stay moving up. 1,000 individuals in this world hold 40% of BTC and they are certainly working together to hurt or help you. There will be buying opportunities as regulators crack down, hackers have their say and LEGAL manipulators lurk around every corner.
If there is only one thing I have learned about trading, its that BIG things take TIME. BTC has not had the time to fully digest the effects of higher prices/world acceptance.
Don't get me wrong, I do NOT believe this is a bubble in the practical sense that it will come crashing down and stay down. Every dip of this next generational technology is a buying opportunity when your swing trading or hodling.
If price rally's higher, which is more likely than any of my entries, you could consider buying at a break above the highs. But that is not my style of trading. I choose to wait for opportunities instead of jumping on the euphoria train. Each to their own!
Keep an eye out for my post explaining my experiences trading BTC & ETH. Goodluck!
Like/Comment/Follow TElphee! – Self-made Technical Analyst. Certification not held but desired after college. 5-year market enthusiast with experience in Forex, Futures and Cryptocurrencies. Trading View is my trading journal. I’m posting a series of live trades and documenting them in real time. Share your opinion, but remember we are only discussing opinions. I’m very eager to learn! Find TElphee on LinkedIn/Twitter/Trading View
Disclaimer: Bitfinex data shown. This information is my own opinion and should not be considered investment advice. Please consult a professional before investing.
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25% Position opened at $14,673 per Coinbase.
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25% of position at 12,950 per coinbase
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20% Entry at 11,500
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All three entries in the green less than a week after taking entry.
I really like you're outlook, and trading strategy. I am a cryptographer and computer engineer, a lot of people fail to realize bitcoins core tech at the moment along with most blockchain technologies are still young and cannot support real-world usage.
Visa has a peak capacity of around 56,000 transactions per second (tps), although at most they only handle about around 1,667 tps on average. The need for such strong network comes down to the fact that hackers can try to spam the network, and as third world countries modernize more transactions will occur.
The biggest problem we have with bitcoin is that the block size gives us a hard limit of about 7 tps due to the bitcoin protocol restricting block sizes to 1MB. Ethereum is currently at 20 tps. Bitcoin cash tried to fix this by doubling the size of the block, and not increasing it again, but within the community, a new branch called Bitcoin Unlimited revealed they had mined the world's first 1GB block, 1,000 times bigger than the normal size which could become the solution we need. In the meantime, a lot of the altcoins such as dash, ethereum, and a few notable others are taking different approaches and building stronger networks. Until this is resolved cryptocurrencies are like Gold, a store of value :) which I really like you pointed out.
UnknownUnicorn981629
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@K0k0, Nice to meet you. Very clear explanation, Love it. Do you believe these other coins may overtake BTC as most useful crypto?
That's a loaded question haha, the interesting thing with cryptocurrencies is they can solve different problems, so we really need to start categorizing them.
Bitcoin has an identity crisis, that needs to be solved. Does it want to be a store of value or a currency, this would mean different things technologically. I think its original founder meant for it to be a currency but in order for this to hold we really need to advance the bitcoin network into handling more TPS. If it's meant to be the Gold of the crypto world it is fine where it is.
Or maybe we are just looking at it the wrong way because the core economic values of bitcoin are so different its hard to imagine in today's society. What is interesting about Bitcoin is that its value is designed to be increasing (Looking into bitcoin halvening), unlike fiat currency, but this is insane how do we evaluate this economically?
I look at bitcoin as a platform, one platform usually dominates, but it's not usually the first platform. As we know from past platforms like Myspace, Facebook came in and took over. So for sure, BTC could be in trouble although it currently is the leader in Currency/Store of value. Other leaders will form in their own cryptocurrency subcategories.
Dash, in my opinion, has taken many steps from a technological aspect to set themselves apart as a currency. I would follow Dash closely. Other than this one I haven't really found a currency that is particularly amazing.
Other Coins that fit different needs that are interesting:
XRP, Ripple, what to note with ripple though is that it is a company trying to solve a problem banks have, what their core technology they sell is, an algorithm, not the coin, their algorithm can use XRP or any other currency to solve the banking problem.
IOTA, very futuristic thinking coin, which has some crazy applications such as robots paying robots for services "Theoretically" is insane. What I love about IOTA is their use of this thing called a Tangle not a BlockChain, it really removes a lot of the limitations Blockchain technology has, it also makes it quantum computer proof. If a Quantum Computer where to be created in the near future, Blockchain would be in trouble. Quantum Computers could allow someone to modify the blockchain to ignore transactions or create fake transactions.
Ethereum, is trying to create an ecosystem. They are practically offering their blockchain, as a software service, that companies can build applications that need a blockchain on top of.
I keep reading up on more and more coins, the ecosystem is growing rapidly with insane ideas such as gaming tokens, publishing tokens (Steemit) and more. Overall just some thoughts :) Overall this is a revolution making us question things such as what is currency, how do we price things and so on.
Visa has a peak capacity of around 56,000 transactions per second (tps), although at most they only handle about around 1,667 tps on average. The need for such strong network comes down to the fact that hackers can try to spam the network, and as third world countries modernize more transactions will occur.
The biggest problem we have with bitcoin is that the block size gives us a hard limit of about 7 tps due to the bitcoin protocol restricting block sizes to 1MB. Ethereum is currently at 20 tps. Bitcoin cash tried to fix this by doubling the size of the block, and not increasing it again, but within the community, a new branch called Bitcoin Unlimited revealed they had mined the world's first 1GB block, 1,000 times bigger than the normal size which could become the solution we need. In the meantime, a lot of the altcoins such as dash, ethereum, and a few notable others are taking different approaches and building stronger networks. Until this is resolved cryptocurrencies are like Gold, a store of value :) which I really like you pointed out.