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Crypto markets run like clockwork, with explosive bull runs every four years, creating wealth—and heartbreak. But why do so many end up losing big, despite knowing the patterns? Let’s dig into the real reasons behind these losses.
1. The Anatomy of a Crypto Bull Run Cycle
Crypto operates on a predictable four-year cycle, with most of that time spent in a bear market. Here’s how it’s shaped up in recent years:
2014-2018 Cycle:
Bear Market: 177 weeks
Bull Run: 34 weeks
Total: 211 weeks (4 years and 2 weeks)
2018-2022 Cycle:
Bear Market: 157 weeks
Bull Run: 47 weeks
Total: 204 weeks (3 years, 11 months)
2022-2026 Cycle:
Currently, we’re still waiting on a new all-time high (ATH). So, we’re in bear territory, biding time for the next surge.
2. The Psychological Roller Coaster of a Market Cycle
Beyond numbers, crypto cycles are an emotional battleground. The real losses come when emotions override logic. Each phase of the market cycle has its own emotional pull:
🟥 The Red Phase: ATH Hangover
After a new ATH, the market dips, but you think it’s just a pullback. Anxiety builds, but you hold on, believing it’ll bounce back. As the losses deepen, denial turns into panic, and when you're down 90%, you sell at a major loss. This painful exit is the capitulation moment—a tough rite of passage for many.
🟨 The Yellow Phase: Recovery and Reluctance
Prices stabilize, but you’re still bitter, caught between anger and depression. Rallies start, yet you’re cautious, often missing the uptrend entirely. When the price finally shows signs of life, hope stirs, but skepticism lingers.
🟩 The Green Phase: Back to Euphoria
Prices push past the previous ATH, and excitement builds as optimism returns. You buy back in, confidence soaring with each pump. Thrill leads to euphoria, but without an exit plan, you’re at the mercy of the next crash.
3. The Perfect Storm: Market Cycles + Psychology
When market cycles meet emotional cycles, even the best strategies can go out the window. The result? Losses despite a solid understanding of the market.
Red Phase: You hit a new ATH, feel invincible, and hold as prices dip. Anxiety escalates into panic, and you sell in desperation.
Yellow Phase: As prices go sideways, emotions flip. Anger and regret simmer until hope teases you back, but often too late.
Green Phase: You’re back in the game, thrilled by each new high. Euphoria blinds you, and before you know it, the next cycle begins, often leaving you off guard again.
The Real Key to Winning in Crypto
People lose money in crypto because they get swept up in the cycle, jumping in at peaks and clinging during crashes. Knowing the pattern is only half the battle—the real key is having a plan and sticking to it, avoiding the emotional highs and lows that lead so many to costly mistakes.