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Investing during a bull market often defies conventional logic. After tracking wealth trends for two months, I've observed that irrational strategies sometimes yield surprising results. From daily "shitcoin" ventures turning $1,000 into $4,000 (despite four tokens going to zero) to inscription tokens generating $6,000 profits despite half remaining unsold, the market rewards seemingly reckless behavior.
NFT investments in Bitcoin ecology (e.g., Big Goose, Crypto Frogs) tripled, while Ethereum-based assets like Facet hover at break-even with promising upside. Even my Blast team ranking at #2900, though modest, hints at future gains.
The Four Anti-Logics of Crypto Markets
- Divergence Without Correction: Bitcoin shows prolonged daily and 4-hour chart bearish divergence yet refuses significant pullbacks.
- Unsafe ≠ Scam: Projects with red flags sometimes deliver returns.
- Anonymous Teams Outperform: No credentials? No problem.
- Narrative Over Fundamentals: Compelling stories drive valuations.
Why Divergence Fails to Predict
Historically, bearish divergence suggests weakening momentum—indicating insufficient buying pressure or institutional involvement, often preceding corrections. However, bull markets transform these signals into:
- Sideways consolidation
- Slower uptrends
- Delayed reactions (e.g., BTC dropping from $42k to $33k after analysts predicted corrections at $33k)
Analysts persistently forecast corrections primarily because they missed initial entry points. Their self-justifying logic: "If markets don't correct, I won't participate." This leads to:
- Missed rallies
- Buying higher later
- Psychological anchoring to outdated price targets
Practical Strategies for Retail Investors
1. Position for Bull Market Confirmation
- If this is early-stage bull (likely), stay invested to avoid FOMO
- Even if mistaken, the next bull run isn't far—holdings won't be stuck long
2. Portfolio Management During Divergence
- Below 50% allocation? Hold position
- Technical traders might attempt banding (risky for most)
- Avoid exiting entirely on divergence signals
3. Addressing Correction Fears
Concern: "This might be a fake rally"
- Macro perspective: Real bull markets approach regardless
Concern: "No dry powder for dips"
Solutions:
- Maintain 50% cash reserves
- Utilize exchange leverage (4% APY loans) strategically 👉 Explore strategic borrowing
Key Takeaway: In bull markets, sometimes illogical strategies prove most practical. Divergence signals require context—they may indicate delayed corrections rather than immediate crashes.
FAQ Section
Q: Should I sell at bearish divergence signals?
A: Not necessarily. Bull markets often absorb technical weakness through time (consolidation) rather than price drops.
Q: How to manage risk if I'm fully invested?
A: Consider partial profit-taking at new highs, or use hedging instruments like options—but avoid over-optimizing.
Q: Why do analysts keep predicting corrections incorrectly?
A: Behavioral economics plays a role: confirmation bias and the pain of missing initial entry points distort objectivity.
Q: What's the most dangerous mindset in a bull market?
A: Waiting for the "perfect" entry point. 👉 Bull market survival guide shows most gains come from early participation, not timing bottoms.
Disclaimer: This content represents the author's perspective only, not financial advice. CFD trading carries substantial risk—consult licensed advisors before making investment decisions.