- There are different approaches you should take to making money in a bull market and a bear market
- Winning a bear market means frequent trading, selling, and shorting
- Winning a bull market requires an entirely different philosophy based around being lazy
Being successful in a bull market is very different to being successful in a bear market. Being successful in a bear market requires shorting at the right time or buying and selling short bounces at the right time. Either way you have to be constantly poring over charts to find places to buy/long and short/sell, knowing all the while that any miscalculation could leave you facing liquidation thanks to a hefty red candle.
Being successful in a bull market however is easy, which is why amateurs can make bucketloads of money. This is because being successful in a bull market requires you to be lazy and do as little as possible. In a bear market you have to work at making gains, but in a bull market the hard work is done for you, as long as you do it the right way.
Below is our three step guide to winning a bull market which should help you get in the right frame of mind for maximizing this precious opportunity and not regretting your actions a year later.
Step 1 – Buy the Right Coin
Whatever your intended length of holding time, buying the right cryptocurrency is critical. Overhyped coins with no proven value are not going to sustain a bull run – they’re going to fizzle out the moment the hype dies down and the influencers have dumped their bags.
Coins that have been around for a while and have performed well in previous bull markets are the way to go, as are new projects that have solid fundamentals. As usual, doing your own research is critical here.
Step 2 – Buy at the Right Time
If you’re planning on holding for the duration of a bull run, which you should be, then timing is crucial. Ideally of course you want to be getting in at the end of a bear market when no one else is talking about a bull run, but even a few months into a clear bull run, as we are now, is fine. Proper bull runs go in cycles of years rather than months, so there’s plenty of time to pick your poison. However, anyone planning their alt coin bag a year into a bull run needs to know that they have cut their holding time (and their potential gains) massively, potentially in half.
If you’re thinking of buying a coin that is 10x up from its bottom a year ago then you might want to think again, as that coin has less juice in it than others that haven’t enjoyed such a run. The later into a bull run you buy the less time you will be holding, and gaining, for.
Step 3 – Take Your Coins off an Exchange
Leaving your coins on an exchange carries with it the implication, subconscious or otherwise, that you are ready to sell them. At the very least it makes them easy to sell at a moment’s notice, which is only a strategy you should employ in a bear market. A bear market involves multiple buys and multiple sells, but a bull market should just need two – a buy at the start and a sell at the end.
Once you have bought your coins, send them off the exchange to a wallet. Ideally this should be a cold wallet, or at the very least a wallet that is harder to access (and more secure) than your phone. The principle is that you don’t want to be tempted into selling too early or frequently, so keep them out of arm’s reach. If everything does go to hell then it doesn’t take more than a few minutes to send them back to an exchange, but this should only be when either the bull run, or the world, is clearly coming to an end.
A Bull Market Favors the Lazy
Of course no one knows when a bull market has topped out, although there are some indicators we can use. Only when you have either reached a personal target or the market is showing signs of a long term reversal should you then send your coins to the exchange and sell them.
Congratulations – you have successfully navigated a bull market! See, easy wasn’t it?