Where we are in the crypto cycle and how to avoid bull market mistakes

Transcript

GM good morning welcome to the milroad show The Daily crypto show that's as exciting as winning the Stanley Cup if you're a Florida Panthers fan I'm your host Jay Hamilton and today we're giving you the Silver Spoon you need to make lifechanging money in the next 12 months but most of you will [ __ ] this up I'm sorry but I have to say it so listen closely cuz this is your last chance to get your portfolio right for the rest of this full run here to share his four tips for the next 12 months is the guy who first bought eth at 150 head of research at milk Road Pro Kad Kai welcome back to the show what's going on guys okay Kai first up before we talk

about your four tips for how to capitalize on the rest of this bull cycle let's just zoom take a step back where are we in this cycle and what makes you have so much conviction that the opportunity is still in the next 12 months yeah so actually it's one of the tips that I'm going to be talking about which is when things get a little hairy in markets which you know the last few months have been I think scary for a bunch of people people are panicking um just zoom out and look at where are we in the cycle and now looking at historical Cycles is never a perfect way to determine you know what's going to happen next um but Assets in general especially crypto has been pretty dang cyclical and while you might not be able to time things perfectly to the day or

even to the month um you can get a pretty general direction of where things are um you just put up a picture here on screen of the last three cycles of crypto and um and on that is the blue line that shows the the 17 I believe we're in that phase where once we get through this consolidation phase and it could be in a few weeks it

could be a few months my best guess is maybe the end of the summer I don't know um it actually could be earlier with ef approval um and so and then I think we go into a parabolic move which looks probably quite similar to Q4 of 2023 q1 of 2024 but probably even more aggressive meaning more pullbacks but maybe even higher numbers um so um that's kind of my best guess when I look back on historicals and also when you just think about where we're at in the rate cut cycle and in the in the liquidity cycle um I just don't think this bull run is anywhere near over I think it's kind of just getting started more than anything that's great news super excited to hear that that we're just getting started so if you haven't done well so far in this bull market

Don't Panic the big opportunity is still coming now Kai yesterday in our episode we gave a lesson on pullbacks because a lot of people are freaking out right now about this current pullback and basically through our research what we noticed was that in the past two cycles there was one cycle had nine pullbacks the other had 12 pullbacks and each one averaged between like 20 to 60% pullback so this current pullback that we're in is actually expected and part of a bull run right but most people don't seem to feel that way you and I have this you know calm by low energy to us right now I'm not getting that from our readers and from the rest of crypto investors what why is

that um well there's a few reasons for this I'd say first humans suck at investing and and more the reason why is humans suck at Psychology and controlling emotions and so I mean it's I think every person listening to this episode knows that you should buy low and sell High we all know that that's like the famous quote from I don't even know who quote it to be honest but we all know that quote but in those moments it's so damn hard to do like when things are low especially like bare Market Vibes it's tough to buy and when things are super high all you want to do is buy and this is just all around psychology more than anything actually I have a a nice image we could put up on the screen Jay of like investing psychology which is if you think of these Cycles when

things go up really high and like we're in green you know it's been green for days and days and days this is the point of of Maximum Financial Risk to actually buy yet it's always the point when we're the most euphoric and we really want to buy and then on the other end is like when things are down things are red I mean like they have been just now for the last few months it's just been down and down and down since March that is the point of least least Financial Risk and yet that is the stage of where we Panic we end up capitulating and we sell even though we know you want to buy low and sell High it just like it's hard to control your emotions and so what happens is people just get scared and if you look at the fear and greed index um

I think we we've just hit like the lowest point we've been on the fear and greed index for the last 18 months and yet I mean for me this is a point where I'm saying hey Buy Buy Buy Buy Buy back in March and in February I kept saying we're going to get a pullback I don't know when but it feels to me we got to get one and I was like I don't know if I'd be buying right now I was at least saying don't leverage and look you know it's all sentiment and the thing you understand about investing is it's just a game and the thing is if everyone understood this and was good at this this game wouldn't be that fun because you wouldn't make a lot of money right but this a bunch of people selling when we're low it's actually a really good

thing because it means we get lower prices to buy in uh and then sell on next time when they buy in when we wait till we get to alltime highs or past sucks but that's the game of investing uh and so if you can just control your emotions you will be 80% 90% of the market it's all you got to do is figure out emotions and so again what why I say zoom out first is because we just got to look and make sure well is this the end of the cycle in in all the metrics it doesn't make sense it should be it'd be way too fast if it was in terms of timing the macro cycle in terms of liquidity and rates doesn't seem to it's just getting started so like if you just think about the numbers it doesn't make sense that this would be the end of the

cycle so it appears it's probably just a pullback which then you can just say okay it's just a pullback these are normal we had 12 of them last cycle nine the one before that or vice versa and so like this is probably just a normal pullback let's buy if anything like I hope it bleeds out more so I can buy more okay so lots of fear and panic in the marketplace but you see it as a byy low opportunity I think the best summary of this came from our friend oie known as OS F on Twitter who put out a great tweet recently that really captures the feeling uh that a lot of people are having in this market and what he refers to as the pain trade H I want to highlight this tweet I'm going to read

it out and then I would love to get your comments Kai and then we'll lead into your four tips which are hopefully going to lead you guys listening to this to not [ __ ] this up and to actually capitalize on this market so let me just read this out for you OS says a description of this year's pain trade you were too bearish all of 2023 and didn't buy enough risk after the BTC ETF got approved you were kicking yourself and instead of buying BTC or eth you went into alts expecting a higher beta catch-up trade you avoided memes because you thought they were stupid you had a bit of fun at points you had a bit of fun at points of the year but of course you're not in

alts for just a 50% gain and you were looking for that 5 to 10x unfortunately alts never really kicked on as you sat on the sidelines watching meme coins go up 10 to 100x across multiple different coins you remember how you sat on the sideline during nfts for too long in 2021 so finally you decided to gamble in meme coins like they around April or May this year unbelievably mean coins have been down only ever since and to add to that pain you also sold any remaining eth you had long before the ETF got approved you're sitting here wondering how the [ __ ] have I lost money in a raging Market oh man that's such a good tweet and I feel for anyone who did that and

the fact is many people did um I know so many people that wanted to sell their eth and then all a sudden we had that surprise ETF approval uh I know so many people that all of a sudden decided to buy meme coins um I mean hey I bought dgen I think in maybe March or something and I mean that's been a terrible idea too so like uh I've made some of those mistakes too I think many of us has have um it's interesting there's two things that we're going to talk about which is one trying to chase narratives right if you mem coins had their narrative for the first bit of this year and I guess a little bit of last year too and all of a sudden once that narrative gets so hot that's when everyone decides to buy again the time of of the most Financial

Risk is when we all start to fomo into mem coins um we tend to lag on these narratives for whatever reason so that's one big thing the other thing that we're going to talk about is just like portfolio applica uh allocation and if you keep jumping around from altcoin to altcoin and you just hold what I would call a bag of [ __ ] then this cycle is going to be very tough for you and these pullbacks are going to be very difficult for you because here's the thing if you just held Bitcoin or eth you're only down like I think bitcoin's down maybe 24% that's it that's not a big move uh eth is is right around the same I actually think eth might be a little bit better right now I'm not sure um but like they're not that bad at all and so

that is a very typical pullback and not too hard to stomach and then they still do well when when things get green if you're holding alts on the other hand especially a lot of meme coins you're down 50 60 70 maybe even 80% in some cases I mean some 90% And so yeah that shit's hard to stomach and one of the problems I see is so many people come in and they forget about just buying those Bitcoin and eth because they're like well I want as as OSF said I want that 5 to 10x so I don't or I want a 100x so they don't even buy those and that's when this stuff becomes so painful these pullbacks are so hard to manage and your emotions just get way out of whack so you really got to f figure out how to allocate properly and then these dips

really are just they're not so bad but um I feel bad for anyone who's followed this OSF pain trade it's it's a funny story but you know I think it's real for many people okay so lots of people feeling pain because they as OSF said they they [ __ ] up the first half the cycle they cha Chase narratives maybe their portfolio allocation isn't the right portfolio allocation I mean let's be honest it's tough uh not all of us are spending every minute of every day like you are researching on chain re researching Ma or looking at TA so it's easy easy to mess it up but the opportunity thankfully is still here still exist it still exists right okay everybody listening guys don't worry Now's the Time Don't Panic Now's the

Time to be confident and that's why we got Kyle to coach and guide us because he coaches and guides thousands of investors through milro Pro so no better person to do it then ukai please please please please help us you've prepared four tips for us today to ensure that we don't [ __ ] this up the next 12 months what are your four tips so I I know it's tough because a lot of people probably listening right now didn't weren't in the market back in like early 2023 late 2022 at the very low thankfully we were we were still doing the show then we had things rolling and so we were buying when it was at its very low and so for us like these pullbacks are nothing because we're up right but I know a lot of people didn't they left at that point or

I know a lot of people just actually literally the first time coming into crypto was like over the last few months so it's a bit different for you guys and so the first thing I would say is I mean study right learn understand these markets and when pullbacks like this happen zoom out zoom out look at the chart that we showed at the beginning of the show look at I don't know we show a bunch of charts in Pro um that kind of look at where are we in the cycle you got to know that these pullbacks are going to happen there's going to be nine 10 there's probably going to be at least 10 of them this cycle we've already had five so you expect them don't get worried when they happen expect them the key is zoom out and go is this probably

the last pullback back meaning are we near the top um or are we likely to recover from this and have more pullbacks I already kind of talked at the beginning of the show of like how you can sort of tell look at macro are we sort of at the tail end of the the macro cycle with meaning rates and liquidity look at previous Cycles timing look at structure of it it's not hard to just look at a chart and go okay yeah it looks like pretty similar to before looks like we got about halfway to go like you can figure this out by looking at charts you can look at sentiment things like that there's a lot of different things you can look at either way um the first thing is just do that and set yourself up to say hey I don't think that this Cycle's over and again

you could be wrong but at least take a look and try to understand it that's the first thing I would say because if you're just sort of basing this off of price action you're never going to get this right right so look at the data that you have we also have a ton of data on Pro if you need help with this um we can help you I highly recommend you go pro actually um starting today uh well actually so starting on Sunday of this week we are raising the price of pro the reason for this is we've just launched three new features into Pro we've launched our community so you can actually ask us questions like hey Kyle do you think that we're at the top of the cycle in our Discord uh and so we've launched that we've launched our portfolio where you can literally see

the exact portfolio we're having uh we have right now and how we're moving it throughout the cycle um so that's really really huge and we'll help you sort of guide through this and then we actually have where are we in the cycle indicators every Tuesday which literally just show you charts of where we think we're at in the cycle so like all the questions you're having right now as this pullback is occurring and we're talking about this they're all answered in Pro the 2,000 people we have signed up Pro they don't have an issue but the price of pro is going up on Sunday because we keep launching more value and so if you sign up today you'll get it for the lower price and you'll have that price for forever so once the price goes up on Sunday that's it it's done um you'll you'll never get that this price

again so how recommend you guys if you want to succeed in the cycle just go check that out and get it before it goes up right that's a steal for you um okay so that's number one figure out where we're at in the cycle number two what I call the the 8020 rule you want to stick to this rule the 8020 rule is pretty simple 80% of your portfolio should be in the majors the majors are Bitcoin eth and soul okay nothing else qualifies a major I don't care how good you think a certain coin is doesn't not matter is not a major and even soul is kind of like a questionable major but just this year we've said you know what we're going to put soul in the majors we believe it's there but Bitcoin and eath and um and then 20% can go in whatever

the hell [ __ ] you want to put it in you want to put it in like good solid altcoins great that's very smart of you with fundamentals like maker fantastic if you want to put it in and daddy token whatever I don't care do whatever you want that 20% you should assume you're going to lose it all and if you want to [ __ ] around and trade it and Trace Chase narratives and do whatever go for it have all the fun you want in that 80% though stays in the majors and you don't touch it the whole cycle okay you sell it when you get to the top of the cycle and that's it that's where your winnings are going to come from okay probably you're going to lose in that 20% but at least you're getting your inner dgen and that Curiosity and the shitty investor

of you you're getting to use that 20% over there maybe you win some if you do that's fantastic fantastic um but secure your profits to the cycle by just holding the majors the thing is Bitcoin we probably think maybe two to three X's from here in the next 12 to 18 months that's massive you don't get those returns in any other Market even though that's the most boring asset in this space eth is probably a four to 5x salana even more be okay with that you don't need a 10 or 100x and halfway through the cycle you're probably not going to get that anyway so like change your expectations and your perspective here buy the majors and be happy with a 2 to 5x that is a steal and if you can do that every year like you're set up for life doesn't even matter how much

you're putting in so 8020 Ru don't move away from that that is the key thing also when when you have pullbacks if 80% of your assets are in Bitcoin and eth you're good you don't care you're not worried it's all good 20% of your portfolio is going to just get wrecked but whatever you're all good it doesn't actually like your net worth doesn't change much when most of your net worth is in the is in the majors um so that's a big one there the next one don't short-term trade and especially I'm not saying don't trade at all like if you want to buy a new token throughout the cycle because I don't know it just launched or it's all of a sudden got some fundamentals around it that's great in Pro we give signals all the time we always put whenever we're looking to buy

a new token we announce it all the time and so but we're not trading we're not like moving in and out of positions all the time we're looking to spot undervalued assets like I mentioned Maker two weeks ago so yeah we're buying that in the middle of the cycle um but don't trade don't buy Buy in and then be like oh it it went up a little bit so now I'm going to sell and buy back in when it goes down like you're not going to achieve you're not going to succeed in that unless you're a Pro Trader sure go for it but like most of us listening here we are not that the other thing is when you're trading or if you're buying or selling don't do it based off fomo if a token just went up 200% because it's been you know it's had the narrative for

the last month don't buy that token at that point that's a terrible time to buy it when do you want to buy the token now when we've just had a pullback for the last three months right and everything is just so undervalued or on let's call it a discount like milk Ro Pro is right now then you want to buy it right you don't want to buy it when the price is pumping and pumping for months but again if you go back to that chart I shared about investing emotions most of you will buy it after it's pumped don't do that okay never buy when it's green for months wait for it to be red uh and then the last thing is um understand risk reward this one is a tough one I think for many people um but it it can be very helpful when I put out that

um maker is undervalued probably the most undervalued asset in crypto and I was like it might 20x the amount of people that I had asked me should I move all of my ether all of my soul or my entire portfolio into maker and I just answer I I didn't even know what to answer I was like what like absolutely not you should never do that to be clear you do I don't think diversification is the best thing if you want to make money you want to consolidate and have actually a little amount of assets but that doesn't mean just one asset asset and it definitely doesn't mean it can be just one asset if it's like the one lowrisk asset in the in the industry like let's say Bitcoin or E you want to just hold that I think that's a great idea but buying a low cap risky ass

token that we say is undervalue but we don't actually know that might 20x that's not you don't want to go all in on that token for sure um you want to you want to allocate based off risk and reward so the majors why do I put 80% towards the majors like Ethan Bitcoin it's cuz like no matter what happens it's pretty clear that those assets are going to go up right to me it doesn't really matter what apps take off what use cases take off if stable coins win out if dpin is a big thing if defi ends up doing well regardless eth is going to do quite well and so is salana that's it you know but for maker to succeed there's just one thing has to happen one stable coins need to do really well and then two maker well decentralized stable coins

have to also do really well and then maker has to be the one that happens to win out of all that you don't know that that's going to happen so like yes I think it can 20x it could also do nothing right whereas eth like it's probably not going to do nothing because as long as crypto does well it's going to go up same with Bitcoin so you got to really think about and I mean you think about ethereum it's been around since 2015 Bitcoin since 20 whatever 10 or 20 29 uh 2009 so like these assets have staying power they have Network effects they're going to be here they're not going away but these smaller apps they can be great opportunities but you don't know if they're actually going to make it and even crypto might make it but they might not and I think the worst

thing you could possibly do is be investing in crypto and when crypto goes from 2 trillion to 10 trillion over the next 18 months and you make no money that would be insane if you were in the right industry that was like the best industry in the world in terms of performance and you actually didn't make any money in it even though you were investing in it that would be the worst case scenario and that's what happens if you just buy a bunch of shitcoins you don't just go 8020 and then understand your risk reward so for example in our portfolio in in milk Road Pro we hold but I think it's about 3.7% of our of our entire portfolio that's understanding risk reward and allocating properly right um so you really really really want to figure that out we just did a pro report all about risk rewards

so I highly recommend you check that one out went out last Saturday um and there's some nice charts in there to help you kind of understand this but really try to figure that out and allocate your assets properly easiest thing I can say 8020 how you allocate in that 20% I mean that's again read that Pro report it's a whole discussion maybe we'll have a whole podcast on it one day but um yeah that's it let's recap real quick Jay first zoom out look at where we're at in the cycle is this the last pullback or potentially the last pullback or there's still plenty of room to go 8020 rule don't short-term trade and definitely do not fomo uh and then understand your risk reward as you allocate if you do those four things I can't guarantee that you won't uh that you won't succeed uh or that you will

succeed sorry but like there's a pretty good chance I mean as we always say it's not hard to make money in crypto during a bull cycle but and it's unfortunate there's a but most will [ __ ] it up and and and we know that because we've spoken and seen that over and over again in past cycles and even seen it so far in this cycle so just it's all emotions it is all your emotions and the best thing you can do is try to have tools that can help you manage those emotions investing in the right assets is one of them allocating properly right zooming out like all these things help you to manage your emotions so if you don't put those things in place you will [ __ ] this

up because you're a human and that's what humans do we [ __ ] things up well on that note thanks so much for joining us today kai no seriously thanks for joining us thanks for guiding us uh towards success in this bull market uh everybody listening in if you want direct access to Kyle make sure you go pro before the price goes up on Sunday link is in the show notes Kai thanks so much for joining again we'll see you again uh later this week or next week I'm not sure when but can't wait till then cool take care guys in case you missed it here's what else happened in news salana has introduced salana actions and blinks which is short for blockchain links enabling websites to integrate salana transactions through

sharable URLs this is huge news as users can now encounter and engage with Salon of transactions on social media platforms online marketplaces and even through physical QR code codes all without leaving the host website also in news Julian Assange the Australian journalist an activist who co-founded wiky linkx the platform renowned for publishing classified documents was released on June 24th he has been imprisoned since April 2019th at the time of his incarceration family members and Friends of Assange created Assange da to fund his legal battle a s Dow member Sil Noah recently revealed that approximately 37 Million worth of eth

has been spent on assange's legal defense and related campaigns thanks so much for joining us today folks have a wicked awesome day thank you for listening to milk Road radio the easiest path to get smarter about crypto if you like this episode share it and hit subscribe or follow so you don't miss out on the next one there's also a link in the description to our free 5minute daily newsletter where we simplify crypto for you while making you laugh and if you're willing to step up your crypto investing game then we'll leave a link to milk Road Pro as well your number one resource to help you invest successfully in crypto one final note this podcast is for educational purposes only and nothing we say is financial advice crypto is risky so you should

never invest more than you're willing to lose thank you friends and we'll see you in the next one