Today I’m going to address a question I’ve been getting asked a lot recently: What to do now that Bitcoin and other cryptocurrencies are crashing? Do you keep on BTFDing? And that, of course, is the crypto-geek phrase for Buying the Freaking Dip. Do you stay away and HODL? Or you take losses and get the F out? Or something else? Of course, the concrete answer really depends on your personal financial situation, your level of risk tolerance and your financial ability to take risks. If you’re an Invest Diva Premium Investing Group member, you probably already know what I’ve been personally doing with my crypto portfolio. But in this video, I wanted to compare Bitcoin and Ripple’s recent crashes to those of a while ago and help you get a sense of a bigger picture.
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Comparing Recent Crashes to Past Ones
I’m a technical strategist and I like looking for patterns on the charts because history has a tendency to repeat itself. But then again, past performance isn’t always a guarantee of future results so you must take everything with a grain of salt. With that, let’s take Bitcoin’s crash from its all-time high level of around $19,900 to the price at which it was trading on Monday, at around $3,670. This price range accounts for an 81.56% decline.
How about the most recent crash from where Bitcoin consolidated for almost nine months at around $6,700 to recent prices? This shows a 45.22% decline. Now, how do these figures compare to previous Bitcoin crashes in the past ten years? Eerily similar.
For example, back in December 2013, Bitcoin dropped 86.58% from around $1,100 to $155 by January 2015.
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Prior to that in January 2013, Bitcoin surged from $12 to $259 within three months, just to come crashing down 82% in a week. The list goes on and on.
Ripple’s XRP has also had its fair share of crashes in its short life, notably its 68% decline from 40 cents to 12 cents from May to July 2017.
What do these comparisons indicate?
While we know that past performance isn’t indicative of future performance, the things we know for sure is that the technology behind cryptos and altcoins such as Bitcoin and Ripple has only gotten more refined, and their acceptance has become wider. With that, I’ll leave it up to you to be the judge. What you think may happen to the industry in the new year? And I’d love to hear from you. Leave your projections in the comments, and subscribe to get more of my updates.