Opinions on Looking Forward and Not Back in Crypto
When trading cryptocurrency, it is helpful to look forward to figure out the next best move. Meanwhile, it isn’t very helpful to look back unless your goal is to learn a lesson or analyze data.
This simple concept is important.
If you focus on the past for analyzing trends and learning lessons, and the future for making the next right move, it’ll help stop you from doing things like doubling down because you mistimed a buy or sell at the top.
The crypto markets move quick and they are volatile, passing up a buy or sell one day may have been a bad move, but that doesn’t mean the same move will be good under the current market conditions.
The right move yesterday has no bearing on the right move today. The specific thing you didn’t do last month has nothing to do with what you should do tomorrow.
You can learn general lessons, like “take profits when the RSI is overbought on all time frames” or “set stops,” and you can look to the past to analyze trends, but you shouldn’t do things like buy or sell today just because you should have yesterday.
You may have missed out on $200 Bitcoins, but that alone doesn’t justify taking too big a position on $20k Bitcoins. You may have not sold at $10k, but that alone doesn’t justify doubling down at $8k to sell at $9k and reclaim profits. You may have sold too much low, but that doesn’t mean you should buy everything back on impulse.
We all regret not buying more low and selling more high, everyone mistimes buys and sells, but that isn’t a reason to throw strategy out the window and start gambling.
A gambler will double down to reclaim the money they lost, playing the same game that they lost money at. An investor or trader is going to focus on the next right move, as that is more likely to lead to success than doubling down out of frustration.
Crypto can be emotional, don’t let the FOMO and fear throw you off your game. The past is for analysis (not regret), the future is for making the next best right move (not trying to make up for bad choices in the past).