The January Crypto Dump
I thought I was fine holding through volatility, and that it was mostly about discipline and not touching the portfolio. It's all fun and games until this dump happens and stretches on for months. That was when everything started to make sense, and I had many realizations.
BTC as the Anchor
In normal markets, ETH and SOL can outperform BTC. But during crashes, I realized that Crypto is still heavily anchored to BTC, so diversification inside Crypto weakens heavily during crashes.
But there are those in Crypto that are no longer heavily anchored to BTC. RWAs like Tether Gold are different because they track the real value of gold instead of BTC. Stablecoins too, but they are mostly used as base pairs for trading rather than assets you frequently trade.
There are also things like Prediction Markets that use the Crypto ecosystem, but depend more on real-world outcomes rather than BTC price movements. So, you can still put money into them and still make profits even if BTC crashes.
Hopefully in the future, Crypto evolves more and more into things that do not depend heavily on BTC as the main anchor.
No Stop Loss
I intended my crypto setup to be a hybrid of long-term holding and active partial profit-taking, so I resisted using stop losses. I was fully exposed, thinking this hybrid approach was fine until it no longer was.
In the end, I accepted that there should at least be some form of wide stop loss, even for long-term trades. Maybe something around 35% if you do not want to stay trapped indefinitely, though of course the wider the stop, the greater the potential loss.
I also learned that understanding support zones matters. Good entries around support zones can make tighter stop losses more workable. If you constantly get wicked out, the problem is often the entry itself.
CEXs, DEXs, and Hot or Cold Wallets
CEXs
To stay in one Exchange or split across Exchanges? We know distributing funds is generally a good idea, but maintaining multiple Exchanges can become mental overhead.
But leaving everything on Exchanges, even across two or three platforms, also does not feel completely safe, whether because of hacks, deception, or freezing.
Hot or Cold Wallets
We know the other option is full custody, but there are downsides too.
One downside of using Hot or Cold Wallets is that resending funds can become expensive during busy periods, and you might miss opportunities on Exchanges while the transfer is pending.
If you are actively managing position trades, it also becomes harder to adjust targets or trailing stops in real time.
So for larger trading capital, I guess accepting the risk of leaving funds on Exchanges makes sense while actively trading. We can't do much about it.
Long-term holdings, on the other hand, are better stored in Hot or Cold Wallets.
Because of that, I started appreciating Hardware Wallets more. I really like the newer Ledger wallets with larger screens, though they are already around 15k PHP as of this writing. Still, I honestly want one.
DEXs
We can also trade through DEXs, but CEXs are still the standard for now. I hope one day Decentralized Exchanges can offer the same trust, liquidity, pricing, and smoothness as Centralized Platforms.
I also see other opportunities in Crypto like staking, DeFi, and airdrops, but I still do not want my setup to become too complicated.
Liquidating When Money Is Needed
The obvious first step is trimming positions that are already at breakeven or profit.
Next would be reducing lower-conviction positions.
Lastly, trim the core holdings you strongly believe in, such as BTC and ETH.
If more cash is still needed after that, then perhaps consider a moderate personal loan (like banks or lending apps) if you have stable income and can comfortably pay it through salary for at least a year. At least you would still be protecting some of your assets instead of fully exiting.
DCA
Before the January dump, my BTC breakeven was around 100k. Then the dump happened.
To reduce the damage, I bought the dip. My BTC and ETH costs were lowered significantly, almost as if the losses disappeared.
Because of the lower breakeven, I could pull money out earlier while still staying within a lower average cost range.
The problem is: what if the market drops another 30%? Would you still buy? You can, but the risk of getting stuck becomes much higher.
Fortunately, my averaging worked because the market recovered, so my breakeven dropped to around 80k BTC and 2400 ETH as of this writing.
Swing and Position Trading
I used to think I could do swing or position trading without stop losses and simply convert losing trades into long-term holdings.
Technically, that avoids realizing a loss, but it cannot work forever. Eventually, too much capital becomes stuck.
So in the end, I realized it is better to respect the trading structure and strategy. Keep a separate core position that you truly never touch, even if more capital is allocated toward trading at certain times.
When it comes to setups, there are straightforward approaches with one entry and one exit, while others use partial selling to reduce risk.
Mobile vs Web
I still prefer trading on the web because it feels more precise.
Still, mobile can be useful for quick actions after entering a trade, such as manually adjusting stop losses or taking profits earlier than planned. Even so, I still prefer using the web platform.
Support and Resistance
This part is funny because at first, I was content just looking at line charts and prices. I kept asking myself why I would even need 4H candles.
Then I started sending chart screenshots to ChatGPT, and it kept asking for 4H and 1D candles. At first, I slowly began absorbing the concepts, though it felt strange, almost like learning code.
I started simulating trades and asking whether certain points were good entries.
At first, I was frustrated because it never directly answered whether it was the right time to enter. Instead, it always said things like “wait for confirmation” or “look at the larger structure.” I even thought it was hallucinating.
But after repeatedly observing different situations and market conditions, I gradually understood what support and resistance actually meant.
During the January dump, I noticed the market stabilizing at specific levels. BTC stopped dropping aggressively and slowly started moving upward again. That was when I finally understood support and resistance.
To me, it feels like a ladder, either moving upward or downward. Buyers and sellers naturally react around certain price levels, which creates those support and resistance zones !
I used to think Crypto was completely chaotic, but because of this January dump, I learned these concepts.
Trading Pairs: Local vs USDT
I am still undecided whether to focus mainly on local PHP trading pairs or USDT pairs. PHP, USDT, and even USDC have almost the same liquidity on Coins.ph, so it feels more like a preference and strategy choice for me.
For now, I still lean more toward USDT pairs.
One idea is using different trading pairs to separate strategies, like using PHP pairs for more direct and straightforward trades, while USDT pairs are for trades where the money would not immediately be needed as fiat and can still be used for re-entries.
Still, mentally adjusting between PHP and USDT pairs is difficult because USDT feels more global. Exchange rates also affect the local currency value of positions, so it constantly requires mental conversion or quick calculations.
Forex in Crypto?
Coins.ph has strong liquidity in USDT and USDC compared to many other assets on the platform.
Because of that, I sometimes think about doing small retail forex-style trades there. But honestly, it feels more like a fun side activity rather than something serious or core to my strategy.
Key Realizations
diversification inside Crypto weakens heavily during major crashes
converting every failed trade into a long-term hold is not always sustainable
good entries around support zones matter more than constantly widening stop losses
separating core holdings from active trading improves discipline
DCA can reduce damage, but it also increases exposure if the market keeps falling
long sideways markets can test psychology more than sudden volatility
risk management matters more during stagnation than during bull runs
In the end, this January dump taught me more about risk, patience, and structure than any strong bull market ever did.