Post
Topic
Board Economics
Re: When the tide goes out
by
deisik
on 03/01/2019, 08:35:34 UTC

And this is the whole thing. Bear market allows you not only to see where your investments are going but also lets you easily unwind them by selling poorly performing coins (if we talk about cryptos) and then proceed to buy more resilient coins at half the price as the market goes downhill. That's what most people overlook in bear markets and so fail to take advantage of. In a nutshell, it is a perfect time to change sails or even the ship itself, tide or no tide

This would be "buy high, sell low"

You got it totally backwards

If prices continue to decline, the market is infested with bears, end of story

What the hell? You have that totally backwards.  Every coin sold is a coin bought.  Bears sell in bear markets, bulls buy - so the lower prices go the market is being infested with bulls.

If it were so, the prices would be rising

Not every coin gets sold, that's what is driving prices down. When there is a rush of sellers wanting to sell at a certain price, there is a lack of buyers at that price, per definition. Then the overwhelming supply is not met with weak demand as some coins in the orderbooks remain unsold. That moves the price lower to a new equilibrium or balance due to competition between sellers as there's always someone willing to sell at whatever price. Sellers stand for bears, buyers for bulls, the end is history
I'm talking about those holding bitcoins - as the price tanks, bears leave the market, not inundate it. What you are left with before the next bull market is a market full of bulls, not bears - this is what enables it to achieve the next bull market peak.

Oh, now you are talking about the state before the next bull run (implicitly postulating it)

Obviously, in a bear market bears don't leave it. If they did so as you (erroneously) assume, the price wouldn't be able to tank so much. Bears are not the ones that just have the coins, they are the ones who have them and want to sell them at the current price, per definition. Note that we are talking about what exists at the moment without making any assumptions about a future market. As I said in my previous post, it is not the coins that get sold, it is the coins that don't and which don't get bought due to not enough buyers, the coins that stay in the orderbooks that make the price drop. It is called resistance, get used to it. If your theory were correct and bears had taken their loot home (or didn't bring it to the table in the first place), we would have already had a bulls market (which we don't yet)