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Why Not Hodl Bitcoin And Trade Alts To Buy More Spot BTC?
If I have learned anything during course of the current crypto bull market, its that trading Bitcoin futures should have featured in the 1000 ways to die
Hope all is well.
After three weeks of roaring the market full throttle and reaching a new all time high, Bitcoin finally ran out of fuel.
The aftermath of the pullback on April 18 was not only chaotic but also historic. In a span of 24 hours, over 1 million futures accounts were liquidated and positions worth more than $9 billion wiped off, according to data provider Bybt.
This is by far the largest liquidation event ever recorded.
And it was a confirmation of extreme euphoria that has been the mainstay of the crypto market since Bitcoin broke the 40k resistance early February.
The unpopular opinion that “everyone is a genius in a bull market” has remained true for crypto. Most traders have trashed risk management hoping for a non turbulent ride to the moon.
I’ll admit, risk management, especially in Bitcoin futures & Alts markets has been hard to implement due to the extreme levels of price volatility.
Tell you what, in the current market conditions, there’s is really no way to avoid stop hunts, that’s if your go to risk management strategy for open BTC futures positions is stop losses. And you could be stopped out a dozen times any given day if you insist.
It doesn’t get any easier for those on hedge mode.
As a day trader, the hardest lesson I have learned during this bull market is that trading Bitcoin futures at an all time high is hard.
Most people who have remained determined on BTC futures have found themselves running around in circles trying to turn profits, which never come, or given back to the market if they ever make any.
That’s why I have refocused my trading to the Alts market. I have also seen tweets from traders that I follow on Twitter saying they have done same. And its a sigh of relief knowing I share sentiments with other traders about the current market conditions.
The popular opinion is “Why not Hodl Bitcoin and trade Alts to buy more spot BTC?”
The thing with Alts is the low volatility factor, even during sharp BTC pullbacks such as the one that happened on Sunday.
This means your go to risk management strategy is still easy to implement with Alts futures.
If April 18 wasn’t a wake up call, then you still have a lot to learn.
That’s all for now.