Anthony Pompliano: How To Overcome Dark Moments in Bitcoin Market
Bitcoin crashed another 20% leaving the market bleeding again. A bounce at $28.8k during early evening was followed by a strong surge taking the number one cryptocurrency back above $30k level.
The $30k-$31k zone has proven to have firm support over the past month or so, and after going up and down Bitcoin made a bullish move and is currently trading again nearly $34,000.
The current market sentiment is in extreme fear. Bitcoin-bull Anthony “Pomp” Pompliano tweeted his thoughts on the situation and what he’s doing at times of uncertainty when BTC is falling.
Bitcoin is under $30,000.
Here is a quick thread to document what I'm thinking right now and what my strategy is during these price drawdowns.
Pompliano in his own words states he’s an “atrocious trader” and doesn’t look to time markets. Instead, given his long-term view on Bitcoin, and a belief it will increase in value over time, his strategy is to accumulate by dollar-cost averaging in.
1/ I'm not a trader. I don't look at charts and I don't try to time markets. If anything, I'm an atrocious trader who is guaranteed to lose 🙂
I have a very long-term view of the asset and believe it will continue to accrue value and adoption over the next few decades.
“I‘m not a trader. I don’t look at charts and I don’t try to time markets. If anything, I’m an atrocious trader who is guaranteed to lose 🙂 I have a very long-term view of the asset and believe it will continue to accrue value and adoption over the next few decades.”
According to Pompliano, this means buying Bitcoin at regular intervals, regardless of its price. This might mean buying when the price is high, or when it’s low. The overriding factor, as he puts it, is “time in the market is more important than timing the market.”
Taking all of this into account, short-term dips are of no concern because one day he intends to hand his Bitcoin to his grandchildren.
For that reason, Pompliano spins the current market dip into a positive situation, in that, it enables him to aggressively accumulate.
How About The Short-Term Picture?
Regardless of the long-term view, what will happen in the near future is of concern to many people.
Analysis of longs vs. shorts shows traders are overall long at a ratio of 7:3. Of the three platforms concerned, Bitfinex traders are overwhelming long with only 9% of trades short. Whereas BitMEX traders are pretty much evenly split with a slight bias to the shorts.
Zen_3_6_9 noted bullish divergence on the RSI, which may point to a reversal. However, given the intensity of the breakdown since mid-month, he concludes instability in the markets. In turn, he expects a pullback of between 10%-15% in the short to medium term.
