On December 17th 2017 after months of prosperity and growth, the market turned cruel

Those who joined during 2017, in euphoria, had never experienced a real downtrend. Now they watch their portfolios whither, either by “hodling” onto their dying coins or losing trade after trade.

I was one of the few people who managed to spin these conditions to work in my favor. For those who don’t know me, I’m a mathematician, an investor and a day trader who has been fortunate enough to see success in his endeavours. I will attempt to help both investors and traders to survive or better yet flourish in these difficult times.

The market takes money from the many and gives it to the few, taking actions based on anything but tested and proven data will turn the odds against you.

For Investors

The notion of buying and holding is advertised as a sensible thing to do in the crypto community. Supposedly helping one avoid unwise decisions stemming from the emotional turmoil in the market. However, the strategy actually takes on a far higher risk than people think.

If you bought last year, whether your investments are up or down is simply down to the luck of exactly when you invested. The bear market has brought certain cryptocurrencies down as much as 99% from their ATH.

By just holding your investments after purchase you are assuming that the specific point in time you invested was the right one to do so. You are isolating your time risk. Just like diversifying investments significantly reduces risk so does diversifying the time of investment. If you have not seriously researched, tested and experimented with timing entry into the market you have no business doing so.

Take advantage of the bear market with dollar cost averaging. Spread your time risk with regular weekly investments so that you can buy on the way down and during periods of consolidation. With this simple strategy you will benefit the most from a bear market. As the price drops or consolidates you can slowly average a bargain price into your investments ready for the next bull cycle.

For Traders

For those struggling to trade in the bear market, firstly remember we must be trading with a proven system that adheres to strict rules, else we are gambling.

Us traders make money regardless of the market conditions. For newer traders the most obvious advice for a bear market is to learn to short. Shorting is a powerful tool when used with care and should not be shied away from, most systems will miss out on over 50% of trade set ups in a bear market if they do not incorporate this.

A bear market, specifically a market where the predominant trend is downwards, is treated very similarly to a bull market where the predominant trend is upwards just with a shift in direction of bias, let me explain this further. Once we have the ability to short we there are only two types of markets, and it’s not bull or bear. You are either trading a consolidating range or a trend.

Consolidating Ranges

For those trading ranges it’s very similar to doing so in a bull market except you adjust your bias slightly to favour the lower bound of your range breaking vs the upper bound.

Trend trading

Trend trading is far less relevant to the overall state of the market as it involves looking for strong trends on lower time frames that tend to overpower the larger trend of the market while they last. When trend trading your main concern is volume and volatility not direction, both trend trading and counter trend trading are viable strategies.

Bonus tip: Recently I’ve been focusing on trend trading, specifically strong uptrend. In such a slow market anything which shows strength draws a lot of attention and acquires an influx of volume which makes trend trading these moves very profitable.

Final Words

“You have power over your mind not outside events. Realize this, and you will find strength.” ― Marcus Aurelius, Meditations

You have no control over the market, so adapt, survive and then thrive. Both investors and traders have the means to take advantage of these conditions, this article shows just some of the many possibilities.