When There is Blood, You Buy

Buying when others are leaving is a way to win in the market, especially when that asset is Bitcoin.
4 min read
When There is Blood, You Buy

Bitcoin has been bleeding lately. 

This is the second longest run of red weekly candles in Bitcoin history. When I saw this statistic, I was astounded. 

The other prior occurrences when Bitcoin had a 5-week, and 9-week negative split were deep in the midst of bear markets. 

Image from @BTC_Archive

But Bitcoin is only about 15% off its all-time high (at the time of writing). That doesn’t feel like a bear market.

So why is my timeline filled with despair about the price action? 

The answer: We got used to a succession of price increases. 

Bitcoin had just equaled the longest run of Green monthly candles in its history. For seven months we saw nothing but price increases. A red candle was bound to happen. 

So we have some blood in the water. Someone pricked their finger and some drops trickled into the ocean. This is no attack where the water turns blood red. This isn’t Jaws. 

The last time we had seven consecutive monthly green candles, we had a red candle and another 6 months of GREEN. Granted, this was 2012 when this happened for the first time so I will not proclaim that the future is written in stone.

What I will, however, emphasize is that Bitcoin retraces in bull markets. It is extremely common for Bitcoin to have pullbacks upwards of 20% to then rebound to new heights. This isn’t new. 

Quit panicking. 

Following the 2020 bottom, there were seven pullbacks greater than 20% before the 2021 April top. Seven. 


There was then a 55% total decline before another rally took Bitcoin to a slightly higher high in November, six months later.

Image from TradeThatSwing

Following the 2015 bottom, there were 17 pullbacks greater than 20% until the 2017 high was reached. Volatility during a bull run is common with Bitcoin. 

Image from TradeThatSwing

My message is simple. 

You haven’t been mauled in the ocean. You have a pricked finger. Now grab a bandaid and keep swimming. 

If your conviction is floundering in these moments then you probably suffer from one of two issues:

  1. You have over-invested what you reasonably can afford and are scared of losing what you need to live. I will not lecture you on investment strategy but if you fall into this boat, you need to educate yourself on better risk management practices so you don’t fall into this trap again. My advice for you at this immediate moment would be to do nothing and wait for the bull market to pick up. 
  2. You want to make a quick buck off of Bitcoin and are scared the top is already in. If this is you, I suggest you learn more about Bitcoin. If you are filled with fear and worry about your holdings, you probably shouldn’t be a trader. Learn more, and your fear will dissipate. 

For everyone else, it is never fun to wake up and see red charts. It’s never fun to see assets you own decrease in value. But if you know about Bitcoin and if you believe in Bitcoin being the apex asset in the world, there is a different perspective to have. A different perspective that can make you a winner and potentially change the course of your life from a monetary perspective. 

The perspective and mentality to run towards the blood in the water. 

Warren Buffet, one of the universally acclaimed best investors of all time advised to, “buy when there’s blood in the streets, even if the blood is your own.”

The meaning? 

When others are exiting and leaving, the market will go down. This is your chance and opportunity to buy an asset you believed in at a higher price for a cheaper price. If you loved the asset at a higher price, you should love it at a lower price because, assuming your conviction is strong, you get more of the asset for fewer dollars! 

Scared markets are where people make their money.

Regarding Bitcoin, stackers love it when the price goes down because it means they can afford more SATs for the same amount of dollars. 

Embrace the blood. Buy the blood. History says you will be okay. 

Stack SATs. 

The views and opinions expressed here are for entertainment purposes only and should, in no way, be interpreted as financial or investment advice. Always conduct your own research when making an investment or trading decision, as each such move involves risk. The team members behind Triana are not financial advisors and do not claim to be qualified to convey information or advice that a registered financial advisor would convey to clients as guidance. Nothing contained in this e-mail/article constitutes, or shall be construed as, an offering of financial instruments, investment advice, or recommendations of an investment strategy. If you are seeking financial advice, find a professional who is right for you.

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