In This Issue
- My portfolio updates.
- Rebecca shares her thoughts on Bitcoin breaking 30k, the Fed conceding to crypto, Ethereum’s 3 massive moves, Binance building a layer 2 & the Ledger recovery service white paper.
- Altcoin Alpha by David.
- Airdrop of the week by Jesse.
- Jesse has a deep dive on SSV Network
- Sam has a report for you on early NFT art.
- In case you missed it by Rebecca.
For any crypto related questions please comment on the website.
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Lark’s Portfolio
I am away from my computer this week so I am not doing any buys and sells.
Instead, I wanted to share my thoughts on one of the most controversial topics in crypto… SELLING.
Stocks, particularly index funds, can be buy it and forget it things.
Bitcoin and ETH, if you are happy to ride 75% downturns through multi-year slumps can be a buy it and forget it too.
But for most assets. Selling will be needed at some point.
The market cycles basically consist of short periods of massive euphoria and thus profit-taking, and long periods of stagnant sideways or painful down-only markets.
The more money you take out during times of high greed, the less you care about the bad times.
Bear markets can be used to build positions, and bull markets can be used to sell them. But, profits must be taken, or those gains will vanish in the next bear cycle as the chaos begins to unfold and bankruptcies, hacks, etc. all start to slowly destroy the market.
Psychologically it becomes hard for a lot of people to sell. The reasons often include
- A sense of identity built around coins
- Betraying the “community”
- Irrational greed
- Fear that you sell too early and miss out on more gains
All of which are pretty flimsy reasons to not lock in the gains and change your financial destiny.
Failure to take profits, or to sell at a loss, is simply a failure to manage risk.
So when to sell for profit?
- When you hit your take profit target. Do it emotionlessly. Don’t think about what if it goes higher. Just make a clean break and enjoy your profits.
- When sentiment dictates. Massive euphoria on your timeline? Sell. Google trends at new peaks for crypto? Sell. Coinbase #1 app in the app store? Sell. People posting pics of Rolexes and new cars. Sell. There is even a good argument for a full exit at this point, although some long-term holds like BTC might make sense to chill on. Remember to be fearful when others are greedy.
- When indicators dictate. Keep an eye on things like the Pi Cycle top indicator as well as all the classics like the MACD and RSI.
- The position has become too big. AKA time to rebalance. Sometimes an altcoin can moon hard and something that was once 2% of your portfolio is now 20%. This is a great opportunity to trim some profits while still staying in the position. Perhaps your ideal target for this coin as a percent of your portfolio is 7%. Great, then cut it down to that. Because an altcoin being 20% of your portfolio in most cases is risky.
- Overvalued. This often happens during narrative hype events. AI popping off and your AI coins just went up by 1,000%? That is probably a short-lived pump and a good time to take some money off of the…
Hi! My name is Lark Davis!
I’m a cryptocurrency investor with years of experience and I’ve been making consistent profits in the crypto space.
I’m passionate about helping others do the same, so I run multiple educational channels on crypto investing.
