Why I Don’t Invest Without Looking at the Bigger Picture

This article is part of the Chain Reactions series: expert opinions on everything blockchain and crypto.

I’m always amused by the folk who predict market movements without considering the broader geopolitical landscape. 

They are usually fixated on drawing lines on a chart or analyzing fundamentals. Only when their original thesis fails do they start to consider outside factors…

I believe these narrow methods are flawed from the start — which is why they tend to be hit or miss. 

We all have biases that guide our approach to analyzing markets. They help shape our individual perspectives and allow us to formulate predictions of the future. But there are shortcomings with being overly prescriptive with any one method of predicting market movements. 

I believe that making financial and investment decisions without considering the broader context is dangerous. If you allow your bias to drive you down too linear a path, you might miss a lot of the subtle nuances that surround the moves made by major global players.

For example, a lot has been made of Germany allegedly selling — or looking to sell off — its BTC holdings. These actions spooked the BTC market and sent prices tumbling. 

Was it FUD? Perhaps. Or, perhaps there are other factors at play.

How often have we heard the price of a project or token is going to the moon — only to find that these narratives have been set up purely to drive a specific investing agenda?

We need to understand the broader macro environment and not be too wedded to a particular way of analyzing the market. 

What TA folk rarely admit to themselves is that they see market movements coming from a homogenous group such as the “retail” market.  We know big players move markets, but this is rarely shown on a TA chart.

For me, I like looking at what is happening globally. After that, I consider what can be gleaned from the charts. 

Only then do I make investment decisions based on the best information I have at the time.

It isn’t easy. But I deliberately don’t do it often — I prefer the long game.