How long does the Crypto Market Bear Cycle last?

Good Morning Fellow Cryptonians

One of you has asked in the Facebook Group  (https://www.facebook.com/groups/cryptowealthnation)  “How long normally would a bear market last, months or years before going back up?”   I will answer this question on a few different levels.

Different financial assets have different time frames for bull and bear cycles. Third parties and external influences can also changes these cycles. So it’s not a black and white answer but more a 50 shades of grey kind of answer.

Generally for the crypto space, we follow a 4 year cycle. If we consider the first year as the start of the bear market cycle, then we could say that 2018 was the bear market cycle, then we follow by 4 months to a year and ½ of consolidation, then we start moving up slowly in an uptrend which normally goes on for 1 and ½ year to 2 years.

Big corrections (in a bull cycle) can last a few weeks and even months.

However we don’t know if this current price downtrend is a big correction or an early start of the bear market.

I know that we all would love for this bull market to move up in a straight line. Many of us have invested in crypto as we see this as our hope and solution to get out of debt, resolve precarious financial situation and maybe quitting a job where we feel unfulfilled, and dead inside. We want to start living rather than just surviving. I have been there I know.

The thing is, that no one can give you 100% confirmation of where we are in the market. If they say they can, they can either see the future or are simply over estimating their capabilities and beliefs or just lying.

The reason why we can’t yet be certain, is because currently, at the time of this post, we are in a no-man’s land. Some experts and technical analysts will tell you that we have started a bear market early, some will say that the dead cross is confirmation of that, while others will tell you that we are still in a bull market and that the uptrend will resume soon.

Reality is no one can know for sure. If they knew, and could see the future with a 90%+ accuracy they would not just be rich, they would be not just millionaires but billionaires!

Personally I have been trading since 2004, in crypto since 2015 and actively trading these financial assets since the start of 2017. When the market went against me, I was unaware of the 4 year cycle I got caught in the downtrend, and had to wait 2 and ½ years to change my financial situation.

Was that a loss? No, I took it as a big learning experience and used it to transform my 5 figure account balance into a 7 figure account balance. I used that time to add more funds to the depleted account, and learn as much as I could about the crypto space.

You can do the same, if this is a bear market. If we are moving back up, whatever you have now in your account should (based on previous cycles) go from 4X to 20X the current value.

In previous cycles portfolios drops by 80% of their value in a bear market, well most of us are down 54% at present.

So we have a drop of 30% on the downside if this is a bear market and a potential of 400% to 1,000% if we are still in a bull market.

So you can make a decision:  do I risk another 30% to 40% of my portfolio and then wait another 2 ½ years for it to start going up again or wait and see if I can make 400% to 1,000% potential profits?

If you have $10,000 at the moment in your account, down from $20,000 , it could end up to $6,000 (a 40% loss from $10,000) or you could transform that $10,000 into $40,000 to $100,000… well I know which odds I would choose.

Let’s say worst case scenario your portfolio drops from $20,000 to even $4,000! If you still believe that cryptos are the way of the future and here to stay, then that same $4,000 could become $200,000 to $400,000 in the next cycle as previous 4 year pattern have shown (a 50X to a 100X return from the lower point to the next high). So is it too bad, if you have to wait 4 ½ years (the remaining of this cycle plus the top of the next) to transform a $4,000 portfolio balance into a $200K -400K balance?

Am I certain that the market will resume the uptrend at some stage?

I am cautiously optimistic, but I can’t deny that at the moment the market is showing us a mixed signal.

So look at your specific circumstance, your finances and long term investment, make a choice and make peace with it.

Learn as much as possible, and if you take risks make sure you can still sleep well at night.

I hope this overview helps you manage your portfolio, your risk and gives you another perspective of this very volatile market.

Be well, be safe, and stay strong

Much Light

Paolo T.