Engaging The Bear

Crypto bear markets have a way of catching the average investor by surprise. However, in hindsight, the warning signs are actually quite evident. Euphoria, greed, and predefined expectations work together to create a level of insensitivity to the market. The element of surprise is a bear market’s greatest weapon. An unsuspecting victim is, after all, the most vulnerable, and bear markets prey on the vulnerabilities of market participants.

However, what if you could see your attacker approaching, and instead of being an unsuspecting victim, make it your victim? In other words, a bear market is no longer something to be feared, but rather something to be anticipated. This is the type of thinking that investors need to adopt if they are to flourish in a bear market, as opposed to being decimated. Essentially, turning the tables on a bear market, and ultimately utilizing it for profit.

This might sound too good to be true to those whose market skills do not extend beyond dollar-cost averaging. However, it’s not that difficult at all, provided you choose to apply a handful of alternative strategies. The average crypto investor is far too one-dimensional, in that they can only interpret and envision gains through price appreciation. This is not only untrue but extremely limiting, ultimately robbing unaware investors of potential gains.

Essentially, bear markets require buyers to prevent an absolute collapse. However, it’s better to be part of the smaller percentage of investors who are actually benefiting from the effects of a bear market. It’s very much a case of the wise benefiting from the foolish. Knowledge, insight, understanding, and skill are what separate investors. Your goal should be to enter this group of investors, and profitability will take care of itself once you join this group of traders and investors.

Investors who simply continue dollar-cost averaging into a bear market fail to see the error in their ways. However, I am about to present a hypothetical case to dissolve this behavior and perhaps inspire introspection. Let’s refer to the previous bull market as a point of reference and use Cardano as an example. I am choosing a top-tier altcoin so as not to overstate my case.

A Superior Way

Instead of hodling through a bear market, I choose to sell once a topping-out structure is in place or when I am satisfied with my gains. In the previous bull market, BTC topped out at approximately $69K. However, if we look at the charts for a confirmation of a reversal, we can ascertain that there was sufficient confluence at $46K. So, even if we sold at the $46K level, that would be sufficient.

Now, if we look at where ADA was trading during this time, we will find an average price of $1.30. The idea is to sell at this level. Remember, I am using a realistic approach and not making use of the actual $69K top. That being said, I sold at the $65K level, which goes to show that selling at $46K was easily achievable. Altcoins usually collapse in excess of 90% in a bear market. However, to be safe, let’s use the 85% retracement level as the repurchase point.

Final Thoughts

By utilizing a strategy similar to this, a bear market becomes a profitable experience. A quick question: Why on earth would an investor not consider turning a losing scenario into a profitable scenario? This is precisely why smart money exits the market. Institutional investors might not know much about crypto, but they understand profitability and cyclical behavior. Unlike the average retail investor, they also know how to implement that knowledge.

As always, this is not investment advice. However, it can definitely provide some food for thought and even spark a few ideas for the next bear market. As mentioned previously, I am looking to be even more aggressive in regard to shorting the next bear market. That’s it for this edition. Catch you in the next one, and remember, profitability is key!


First of all, I am not a financial advisor. All information provided on this post is strictly my own opinion and not financial advice.