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.
Excellent, thank you
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.
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.