Retail Will Be Back...Soon

There is a saying that time in the market is more precious and lucrative than timing the market, and I have to admit that, after seven years in crypto, I can attest that being consistently present in the market is far more profitable than occasionally nailing a market prediction, only to have it all wiped out by the market's fluctuations.

Although I lack formal education in technical analysis, a skill I plan to acquire during the next bear market, I have developed the ability to "read the psychology of the market." It's not an intricate art; simply pay attention to the masses and act contrary to their actions, and you'll fare well in the financial markets.

Recently, while watching our national soccer team play against Belgium with a friend at a local restaurant, he casually mentioned that he wanted to invest in the stock market. I was taken aback by this revelation, as I knew him to be disinterested in investing, despite our frequent conversations about crypto and finance over the years. It seemed like he had been awakened by his sister, who would also guide him on his investment choices.

I recalled how, during the past couple of years, he had shown little interest in investing and had even argued that the media often portrayed a negative view of crypto. However, now that the "everything bubble" is on the brink of bursting, he's eager to put his money into stocks. I shared my thoughts with him, advising him to consider crypto instead, as its potential for exponential gains far surpasses that of stocks.

In my opinion, you can't go wrong with crypto right now, regardless of what you invest in. Nevertheless, I will let him make his own decisions, and merely guide him through using Revolut to invest in stocks, crypto, or whatever he chooses. I don't want to be held responsible for his financial choices. This situation, however, serves as an important signal for me regarding the state of the market.

I'm not suggesting that the market's peak is imminent; it might take another year before the crypto bubble bursts. The truth is, no one can predict the future with certainty. But when I see retail investors entering the market with confidence, believing that the markets will continue to rise for another two years, it's a warning sign for me to be cautious in the coming months and focus on preserving my capital.

Remember, the value of your portfolio is temporary, and so are profits. When you see your portfolio reaching unsustainable valuations, it's probably time to take some profits out "just in case." I know this is what I'll be doing in the coming months when things start to get out of hand.

Thanks for your attention,
Adrian