Trading microcaps narratives and micro-cycles 🔰

“Most big money has been made being early to micro cycles:

DeFi Summer, Ethereum NFT run, Ethereum onchain degeneracy, Solana NFT run, Ordinals, SocialFi, Farming, Solana memes, Runes and prob a bunch I forget here.

But dilution is one hell of a thing and as soon as it starts to happen you should get into capital protection mode instead of adding risk as the niche dilutes.

Extract as big as you can as early as you can and get your money ready for the next micro cycle run, it could happen today or later this summer but whenever it does happen you gotta be ready. Most of my capital comes from my ability of spotting these micro trends early on and oversize into them.

But to spot something new you need to know how the market looks like on a daily basis and that's the exact reason why you gotta commit to the trenches even when you feel like it's dead out there, how could you spot the doe in the forest if you don't spend time there in the first place?

Market going up or down doesn't really matter neither since these trends happen even in bad conditions, I would argue it's even better in that case because most market participants are scared and risk off and it usually gives you a bit more time to actually spot the shaping narrative, plan out your strategy and execute on it.

An early trend has very few quality assets to put your money on and ALL the capital entering this new arena has to flow to these handful of things. Until dilution hits and the capital entering gets split on more and more projects everyday, eventually new inflows stop, marketcaps across the board become unjustified and the house of cards resets.

I usually like to come back to an older niche once it has seen purge simply because just like nothing goes up in a straight line, nothing goes south forever neither. You can find great swing setups and grow capital by relying on simple market mechanics.

As always, be confident in yourself, make errors and trade on your own, very few people can reliably and consistently spot these trends early so dont expect help from some external force out of the blue, it's all inside you.

Keep winning”.

Link to the original tweet: https://x.com/wronguser000/status/1799764601225019839