"Are You Bullish or Bearish?"

Louis Sykes
October 18, 2022

You hear it every day.

Are you bullish or bearish?

Like, what does that question even mean?

Which asset class are we talking about?

What time frame?

What sector?

It's a question that only journalists should ask. People with skin in the game understand that strong opinions will always be weakly held when money is on the line.

Our opinion never matters. What does matter is how we adapt our approach as new evidence comes in that either corroborates or contradicts our initial thesis.

"Where's the S&P going to be at year-end?"

"Are you bullish stocks?"

"You think we've bottomed?"

Maybe these are the important questions.

Maybe these topics do matter.

But if you don't have a solution, then what about all those other problems?

How are you going to manage risk?

Where does the market invalidate your preconceived opinions?

What's your exit strategy?

Are you just going to ignore that part because it makes you feel good about being "right"?

It's the type of low-resolution thinking that gets us absolutely nowhere.

The market will always be a sum of the parts; it's always a market of stocks, or in this case -- cryptocurrencies. You have to maintain a certain level of objectivity to treat every chart on its own merit.

In this sense, even if we have no underlying directional conviction for the crypto markets at large, we can still evaluate each crypto on a case-by-case scenario.

It can be easy to group everything together -- it's a mental trap even I find myself falling into every day. That is, I force my directional biases I have toward Bitcoin on every crypto in the asset class.

"If Bitcoin is sideways, we don't want to be looking for ANY longs," I often tell myself.

But, truth be told, this is still far from the truth.

Just take a look at our recent winner, Quant $QNT.

Even with Bitcoin and the rest of the asset class chopping about in no man's land, Quant has ripped more than 50% over the last two weeks.

Crazy relative strength...

It's yet another testament to the benefits we reap by leaning on the A+ setups in messy tapes such as these.

It can be easy to paint markets with a broad brush by adopting a binary mindset of being bullish or bearish.

But, in doing so, we can far too easily let gems like these slip under the radar.

Technical analysis certainly doesn't give us the answers. But it sure goes a long way in helping us ask the right questions.

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Thanks for reading, and please let us know if you have any questions!

Allstarcharts Team

 

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