Analyzing past bull and bear markets is not only useful, but also necessary. It is important not only to study charts and metrics, but also to follow the opinions of bloggers and the mood of the masses on social networks. This helps to understand how to manage your investments: when to buy assets and when to take profits.
Those who have experienced at least one full cycle (bull and bear markets) already know when it is best to enter an asset and when it is worth exiting. Although no one can accurately predict the price, it is quite possible to determine whether we are near a peak or a bottom.
Example of Solana:
A good example is Solana coin. At the end of 2022, amid the FTX collapse, the price fell to $8. At that moment, most people were shouting: “Everything is lost, Solana is a scam, don’t buy it, it will fall even lower.” The masses were betting on a further fall to $1, opening shorts. I bought at $13 and averaged my position.
The coin was in consolidation for almost a year. People stopped talking about it, many sold the asset at a loss and forgot about it. However, in October 2023, Solana began to grow sharply and reached $100-120 in two months. And then the cries began again: "The price is too high, whales are accelerating the market to dump assets on small traders." Then a correction followed, which caused a new wave of panic: "We said the price would fall to $10, it's time to put shorts."
However, after some time, Solana rose to $210 in literally three weekly candles, knocking out all the shorts. Many who shouted that the asset would not recover began to experience FOMO. Now that Solana is again in a bullish momentum, many are predicting a fall to $100 and are placing shorts (just this morning I saw a bunch of posts that it will not rise above $174). I believe that it will break through the resistance at $190 and continue to grow.
Conclusion: When you hear mass statements on social networks like "everything is lost, sell the asset at a loss", this can be a good signal to buy. And vice versa, when the coin is at its peak and everyone predicts further growth, places logs and drives the crowd into the coin, it is worth thinking about selling.
Share your opinion in the comments!
