Benzinga - by Khyathi Dalal, Benzinga Staff Writer.
In his latest video podcast, Former Goldman Sachs executive Raoul Pal discusses when traders should sell their crypto. He suggests not nailing market tops and adopting a time-based approach.
What Happened: While addressing the query "When do I sell my crypto?", Pal stresses the importance of understanding one’s goals and investment time horizon, noting that crypto is inherently cyclical. Pal states, "Crypto is very cyclical based on this ‘everything code’ thesis." This thesis ties these cycles to global financial patterns, Bitcoin halvings and U.S. presidential elections.
Drawing on his own experiences, Pal shares his journey from buying Bitcoin at $200 in 2013 to navigating the extreme highs and lows over the years. "Every time I've seen anybody try to time the market, including myself, it's been suboptimal," he admits. "I would have made five times as much money by not doing anything," he reflects, highlighting the challenge of market timing.
Pal advises against trying to precisely nail the market tops, suggesting instead a time-based approach. "Use time, not price," he recommends, proposing that investors take profits towards the end of the year when crypto typically performs well.
Also Read: Why This Crypto Market Is ‘A Bear Trap’ And Which Coins This Trader Is Backing
Why It Matters: Pal underscores the importance of having cash ready to buy during market downturns. "Every time you buy those lows, you're going to 10, 20, 50x depending on what you're buying," he emphasizes, stressing the value of long-term compounding.
He notes, "This time around, I didn’t do anything except buy when I thought we were close to the bottom." This strategy, he explains, allowed him to capitalize on significant market rebounds.
Lastly, the Macro Guru touches on the emotional aspect of investing, recognizing the difficulty in reinvesting post-downturn due to fear of losses. "The hard thing is actually putting the same amount back in again," he says, acknowledging the psychological hurdles investors face. He underscores the importance of sticking with the secular trend and not being swayed by short-term volatility.
Pal has previously predicted cryptocurrency markets to enter a “Banana zone,” with the total market cap rising to $10 trillion until the end of the decade. He has also predicted that Bitcoin (CRYPTO: BTC) will go as high as $1 million.
What’s Next: The influence of Bitcoin as an institutional asset class is expected to be thoroughly explored at Benzinga’s upcoming Future of Digital Assets event on Nov. 19.
Read Next: Bitcoin’s Rally Splits Trader Opinions: ‘Daily Says We’re Going Higher’ But One Indicator Presents A ‘Sell Signal On The 4H Chart’
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Image created using artificial intelligence with Midjourney.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.