Who knows what will happen, but I saw that Bitcoin is currently down over 70% for the last year. So, I wanted to see how it has done historically when that happens.
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Excellent, thank you
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Your study is interesting but it does not show the max drawdown after buying at the 70% drawdown level and holding for x days.
In my opinion bitcoin buyers should not rely on this data alone but should wait for confirmation before pulling the trigger (breakout of a down trendline or a resistance line, moving average crossover to the upside, higher highs and higher lows, positive MACD, etc…).
This is still a good study. 
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Bitcoin will still have to drop about 39% from its current price to match its worst historical drawdown of about 85%. Of course, it could always set a new record….
This definitely isn’t a trend following trade yet or anything. But I think enough of my own portfolio is already tied to trend following. So I think it is worth the risk for me.
The issue with buying after this dip is that everyone thinks they’re in on it so if it ever does recover again it will likely take much longer imo.
I think I understand what you are saying. I do think bitcoin is actually becoming more stable in terms of percentage changes overtime. It never feels like it but as this log chart shows it certainly is becoming more stable. That could of course reverse.
I feel Bcoin can hit 9K. Just my opinion.
I agree that is 100% possible. That being said I think picking a moving average such as the 100, 200, or 200+ and holding when it is above and exiting when it is below isn’t a terrible approach. If it does go to 9000 it will have to cross below all of those first. Of course, this introduces the chance of whipsaw, but I would rather have that than blindly holding bitcoin which could crash by a security risk being discovered or simple market share loss.
Even when you get lucky and do well like this investment, it can be really hard to not have regret for not investing more. Of course, I may have regret later that I didn’t do less.
Regretting not buying more than I did as of now. But I did move all my Bitcoin to BITO inside an IRA and did buy than more 1 coins worth. Makes for a nice tax free gain so far. Plus now I feel better about selling out when trend and sentiment indicators will indicate trouble ahead. I think bitcoin is very interesting and I know many crypto fans don’t like BITO because it doesn’t hold bitcoin but futures. For me I prefer it because I don’t have to manage personal crypto access, less theft risk, and can easily be traded in and IRA without incurring taxes. That being said I live in a stable country. If I was worried about banks failing or needing to flee my country for safety then maybe I would lean more heavily to actual crypto.
I originally posted this on November 12th, 2022. The return of Bitcoin from then to today was 107% which was slightly below the average of the table shown for the forward 1 year return.
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