When It Comes to Crypto, Throw Your Charts in the Trash

When It Comes to Crypto, Throw Your Charts in the Trash

Since I started researching cryptocurrencies back in 2016, I never really focused on the technical analysis of their price movements.

I was always only interested in the fundamentals.

Rather than bogging my subscribers down in the technical details, mechanics, coding, and math that goes into bitcoin and its underlying blockchain technology… I wanted to help them understand the idea.

And the idea is simple: Usage and adoption.

All you need to know to make money in this asset class is that crypto will go from being used by a small number of people to a massive number of people.

That’s it.

I get it. After hearing my constantly beat the drum on “usage and adoption” for over eight years, people will start to tune out. They’ll get bored.

And that’s the worst thing you can do – become bored. That’s when you’re most susceptible to fear, uncertainty, and doubt (FUD).

When you’re bored, you’ll focus on the daily price action instead of the fundamentals. You’ll follow technical analysts.

Now, many technical analysts are very good at reading their charts. And based on those charts, they’ll tell you, “Bitcoin has already peaked”... “The top for bitcoin is in”... Or “The Fibonacci levels are saying this or that about bitcoin.”

Technical analysis has its place… And it certainly has value.

But when it comes to an asset like bitcoin that’s on a long trajectory to mass adoption, technical analysis can really impoverish you.

That’s because it can get price action right over the short term… But it’s terrible for creating wealth over the long-term.

Whether you’re investing in bitcoin, Amazon, Microsoft, Google or Facebook, at some point, the charts will point to huge price drops. And you might be tempted to act on those short-term technical signals.

But over the long term, these companies have seen mass consumer adoption. And each company – as well as bitcoin – has a value above $1 trillion.

As I’ve written in the past, if you want to use technical analysis to trade bitcoin or any other crypto, you should only use it for your short-term trading stack. Never to inform your thinking about your core stack.

Your short-term stack is your play money. But for those of you who are letting boredom creep in, I have some incredibly bullish news for you…

Old Money Is Chasing New Money (Crypto)