Adam's BTC cost-basis illustrates the respective average cost basis between three different groups - miners, swing traders and short term or novice trades - each group having different investment horizons, average tenure in the market, costs basis and break even points.
Similarly to my prior conversation regarding BTC and it's cost basis, we see a similar but exaggerated state of affairs, specifically;
1) miners have grossly lower costs basis due to average cost of entry. The bottom line represents only 40% of the market with the BTC market costs basis lying around $7,800. Price volatility has little impact on early adopters and miners due to such large unrealised gains acting as a cushion,
2) average swing traders lie above the middle line. Breakeven is experienced as price approaches this line, with breakeven trading ensuring. The middle line, which represents the average cost basis of swing traders, is really a breakeven point for up to 10% of the marker on average. This point runs under support zone that marker structure enthusiasts would have identified. In contrast to DOGE, a dilution factor does not act as head wind - so whereas DOGE breaks the average swing traders break even point, currently on BTC this line is holding!
The reason for the difference is quite simple - dilution factor!
3) Novice traders caught at the top are at net loss with dilution factor effects noted above applying. This means, volume of new long must be large enough not only to lift average breakeven, but noting the difference of these same type of traders in DOGE coin!
Three lines - decision matrix is now simple. No more FUD or FOMO! Clear demarcation points to clarify decision making.
Similarly to my prior conversation regarding BTC and it's cost basis, we see a similar but exaggerated state of affairs, specifically;
1) miners have grossly lower costs basis due to average cost of entry. The bottom line represents only 40% of the market with the BTC market costs basis lying around $7,800. Price volatility has little impact on early adopters and miners due to such large unrealised gains acting as a cushion,
2) average swing traders lie above the middle line. Breakeven is experienced as price approaches this line, with breakeven trading ensuring. The middle line, which represents the average cost basis of swing traders, is really a breakeven point for up to 10% of the marker on average. This point runs under support zone that marker structure enthusiasts would have identified. In contrast to DOGE, a dilution factor does not act as head wind - so whereas DOGE breaks the average swing traders break even point, currently on BTC this line is holding!
The reason for the difference is quite simple - dilution factor!
3) Novice traders caught at the top are at net loss with dilution factor effects noted above applying. This means, volume of new long must be large enough not only to lift average breakeven, but noting the difference of these same type of traders in DOGE coin!
Three lines - decision matrix is now simple. No more FUD or FOMO! Clear demarcation points to clarify decision making.
