3 Essential Steps to Navigate the Bear Market
Macro global economic factors look ugly, a global recession looms, and cryptocurrency and more traditional assets enter a protracted downwards period.
Recessions are a natural part of market cycles and are essential to weed out weaker companies, force people to upskill and become more productive, and most importantly, offer a fantastic opportunity to enter the market.
1. DCA & DCA (Dollar-Cost Averaging)
Set up weekly buys on Bitcoin. Bitcoin is the first currency designed to appreciate over time due to its scarcity and built-in inflationary mechanic- the halving taking place every 210,000 blocks or roughly every four years.
Bitcoin is currently at $20,000, the prior cycle’s ATH (All-Time High), which has historically marked the accumulation period of a lifetime.
It must be noted that Bitcoin’s existence as an asset has taken place during a historic bull run and has yet to see a recession. Nobody knows how ugly the price action might get, but the value of Bitcoin remains unchanged. Those with a long-term horizon should take advantage of this opportunity.
2. Build a Cash Position
Build a cash position to take advantage of the coming dips. The US dollar is going to zero; however, it represents a great short-term hold. During times of global economic uncertainty and when the FED tightens monetary policy, the dollar tends to grow stronger.
The economic fallout has only just begun and no one knows how bad it will get. Expect asset prices to drop and markets to post lower lows until the FED pivots and announces they plan to stimulate the economy. At this stage, throw everything into the market and watch it fly when the FED reintroduces cheap money.
The financial trade of the century is trading USD- great short term, dreadful long term, headed to zero- for BTC- dreadful short term due to price volatility, great long term, designed to appreciate. Any doubters of Bitcoin take note of its stickability; released in 2009 following the financial crash, in just over ten years, it has gone from an idea posted on a cryptography forum to legal tender in a nation-state.
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3. Enjoy Life
The markets are not everything. More financially minded people will likely use this opportunity to put their heads down at work and get busy aiming for a promotion, perhaps change company, or maybe retrain and start fresh in a new career. All in the pursuit of a greater capital position to enter the market, and arguably this is wise in certain regards.
But market downturns have a brilliant effect of making people realise what is truly important. Go outside, spend time with the family, and pursue a new hobby. Life is made for living, so get busy living or get busy dying.
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