The Wolf Den #358 - Psychology And Health In A Bull Market
thewolfden.substack.com
This newsletter is sponsored by PHEMEX, the world's best crypto exchange for both spot and leverage. Sign up with the link above and get some free Bitcoin - up to $1200 worth. I really encourage you to check them out.Instead of writing my own intro, I want to share a tweet thread by Ari Paul from February which offers incredible insight on psychology and health in investors and traders.“We’re probably on the cusp of violent moves across Bitcoin, majors and alts that will soon be more violent. Here’s a thread on psychology and health.Bear markets are brutal, but bull markets can be just as tough in other ways. Seeing random people suddenly 30x their money in scam coins (or maybe quality that you missed) is rough. Trying to keep up with the constant flood of news and opportunity is exhausting.Euphoria over life-changing gains. Then a gambler’s craving for just one more hit of that same euphoria. Here’s my advice, including some hard-learned lessons from the last bull/bear cycle.Go all-in mentally. This is an incredible opportunity. But… pace yourself. This is a marathon, not a sprint. Maintain your health, good sleep, and dietary habits when possible, and your sanity.Stay grounded. Hang out with non-crypto people, friends, family etc. Go for a hike, go camping, get away from screens on occasion. Read a book. Meditate. Do things that bring your cortisol and adrenaline levels down.Perhaps most importantly, don’t blow up. It’s amazing how many people end bull runs with less money than they started. The easiest ways to blow up: FOMO'ing into positions after they’ve outperformed with big chunks of your portfolio, leverage, and shorting.The biggest/hardest question: when to sell? No easy answer to this, unfortunately. A reasonable approach is to very gradually scale out of positions on the way up. For example, you could sell 20% every 2x. Not optimal but will likely result in a fine outcome with less stress.One tough thing about parabolic markets: no matter what you do, you’re almost certain to end up with 30%-50% less money than you had (or would have had if you weren’t scaling out) at the absolute peak. And that’s a pretty darn good outcome. Your paper gains are "real,” but best to think of it as “found money” until you realize the gains. If you put $100k in, turn it into $3m, it can still be psychologically painful and lead to poor decisions to end up exiting with $1.5m. Remember that’s a great outcome!Lastly - while I’m obviously a highly convicted bull, these are truly risky and speculative assets. Even if they do change the world as we hope, that doesn’t mean the price of an asset can’t fall 80% and stay there for years as even the highest quality cryptocurrencies do.I’m going to tack on a reiteration of the things that make people blow up. A. FOMO - chasing a parabolic move. Basically - don’t do it, and if you’re going to do it, do it small and/or with a stop limit. B. Leverage - this is a hyper volatile market; you don’t need it. C. Short selling - Imo - rarely worth doing in a bull market at all. Markets can and will gap higher. You can’t trust stop limits since exchanges might go down when you need them. Why take the difficult route when you could go with the tailwind?"Take all of this advice to heart! It is essential in these crazy times to take care of yourself - particularly your physical and mental health. Be prepared for the inevitabilities noted above and you will come out the other side both happy and profitable.In This Issue:Psychology And Health In A Bull MarketBitcoin Thoughts And AnalysisAltcoin ChartsLegacy MarketsThe Market Cap Leaderboards Are ChangingMastercard Moves Closer To CryptoU.S Senator Sees Bitcoin As Possible Reserve CurrencyThe Wolf Of All Streets Podcast Ft. Harry DentMy Recommended Platforms And ToolsIF YOU HAVE ANY ISSUE WITH THE NEWSLETTER OR YOUR SUBSCRIPTION, PLEASE CONTACT: PREMIUMSUPPORT@GETREVUE.CO
The Wolf Den #358 - Psychology And Health In A Bull Market
The Wolf Den #358 - Psychology And Health In…
The Wolf Den #358 - Psychology And Health In A Bull Market
This newsletter is sponsored by PHEMEX, the world's best crypto exchange for both spot and leverage. Sign up with the link above and get some free Bitcoin - up to $1200 worth. I really encourage you to check them out.Instead of writing my own intro, I want to share a tweet thread by Ari Paul from February which offers incredible insight on psychology and health in investors and traders.“We’re probably on the cusp of violent moves across Bitcoin, majors and alts that will soon be more violent. Here’s a thread on psychology and health.Bear markets are brutal, but bull markets can be just as tough in other ways. Seeing random people suddenly 30x their money in scam coins (or maybe quality that you missed) is rough. Trying to keep up with the constant flood of news and opportunity is exhausting.Euphoria over life-changing gains. Then a gambler’s craving for just one more hit of that same euphoria. Here’s my advice, including some hard-learned lessons from the last bull/bear cycle.Go all-in mentally. This is an incredible opportunity. But… pace yourself. This is a marathon, not a sprint. Maintain your health, good sleep, and dietary habits when possible, and your sanity.Stay grounded. Hang out with non-crypto people, friends, family etc. Go for a hike, go camping, get away from screens on occasion. Read a book. Meditate. Do things that bring your cortisol and adrenaline levels down.Perhaps most importantly, don’t blow up. It’s amazing how many people end bull runs with less money than they started. The easiest ways to blow up: FOMO'ing into positions after they’ve outperformed with big chunks of your portfolio, leverage, and shorting.The biggest/hardest question: when to sell? No easy answer to this, unfortunately. A reasonable approach is to very gradually scale out of positions on the way up. For example, you could sell 20% every 2x. Not optimal but will likely result in a fine outcome with less stress.One tough thing about parabolic markets: no matter what you do, you’re almost certain to end up with 30%-50% less money than you had (or would have had if you weren’t scaling out) at the absolute peak. And that’s a pretty darn good outcome. Your paper gains are "real,” but best to think of it as “found money” until you realize the gains. If you put $100k in, turn it into $3m, it can still be psychologically painful and lead to poor decisions to end up exiting with $1.5m. Remember that’s a great outcome!Lastly - while I’m obviously a highly convicted bull, these are truly risky and speculative assets. Even if they do change the world as we hope, that doesn’t mean the price of an asset can’t fall 80% and stay there for years as even the highest quality cryptocurrencies do.I’m going to tack on a reiteration of the things that make people blow up. A. FOMO - chasing a parabolic move. Basically - don’t do it, and if you’re going to do it, do it small and/or with a stop limit. B. Leverage - this is a hyper volatile market; you don’t need it. C. Short selling - Imo - rarely worth doing in a bull market at all. Markets can and will gap higher. You can’t trust stop limits since exchanges might go down when you need them. Why take the difficult route when you could go with the tailwind?"Take all of this advice to heart! It is essential in these crazy times to take care of yourself - particularly your physical and mental health. Be prepared for the inevitabilities noted above and you will come out the other side both happy and profitable.In This Issue:Psychology And Health In A Bull MarketBitcoin Thoughts And AnalysisAltcoin ChartsLegacy MarketsThe Market Cap Leaderboards Are ChangingMastercard Moves Closer To CryptoU.S Senator Sees Bitcoin As Possible Reserve CurrencyThe Wolf Of All Streets Podcast Ft. Harry DentMy Recommended Platforms And ToolsIF YOU HAVE ANY ISSUE WITH THE NEWSLETTER OR YOUR SUBSCRIPTION, PLEASE CONTACT: PREMIUMSUPPORT@GETREVUE.CO