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Bear Market: Bear Market Divided in 3 Stage

Reminder! Bear markets are the absolute best for finding opportunities!

A bear market can be divided in 3 stages

Stage 1: Market turns bearish, money starts exiting the market. Denial, fear and desperation. Everything bleeds rapidly as liquidity dries up - crypto, BTC, ETH

Stage 1 is not a stage where we want to buy and be long!

The only exception is extremely oversold days/days with liquidation cascades - these are the only days we want to buy oversold assets for the short term.

Stage 2: This is a stage where market goes into boring mode. Volatility is low and market chops sideways for months.

Altcoins continue bleeding. This is a stage where we want to look to find and accumulate hidden gems for cheap prices.

Stage 3: Bottoming stage - High timeframe trend is about to reverse. We want to be buying with confirmation of high timeframe trend reversal. Check MA tutorial

Currently I would say the market is at the end of stage 1 and beginning of stage 2 depending on which asset we look at.

Understand that you won't be able to buy the bottom majority of the time - and thats perfectly fine.

Patience is the foundation of financial freedom

This post is based on this twitter thread.


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