Recently, I made a post where I wrote:

“If you want to survive downturns, preparation must happen before the downturn.”

Many people did not fully understand what that meant especially how someone can prepare for a downturn before it actually happens.

So I want to explain this in more detail from my personal point of view.

This is not financial advice.This is simply my personal perspective and experience.

👉 A downturn cannot be predicted with 100% accuracy but its probability can be identified.

Markets are not about prediction. They are about probability management.

Now let’s understand the core idea 👇

Don’t Predict Downturns Identify Warning Signals

Markets rarely crash without signals. They usually show signs first:

  • Excessive euphoria (everyone saying “up only”)

  • Overuse of leverage

  • Retail FOMO at its peak

  • On-chain distribution (whales quietly selling)

  • Macroeconomic tightening (interest rate hikes, liquidity squeeze)

A downturn doesn’t arrive instantly liquidity exits first, structure breaks later.

Cycles Are Not Perfect

Yes, Bitcoin and crypto move in cycles.

But no cycle repeats exactly the same way.

Those who try to catch the exact top or bottom using only historical charts often get trapped.

Cycles provide direction not precise timing.

What Smart Players Actually Do?

They don’t try to predict downturns they manage risk.

  • Reduce position sizing

  • Use stop losses

  • Keep cash reserves

  • Diversify portfolios

Recognize narrative shifts early

They prepare for survival before the crash not after it.

The “Invisible Hand” of Whales

Whales can influence short-term direction,

but they cannot fight macro liquidity.

If global liquidity is tightening,

even whales cannot sustainably push against that force.

Markets ultimately follow the bigger driver:

Liquidity > Whales

🔥 Final Original Answer

Downturns are not predicted exposure is reduced before they happen.

The trader who focuses on predicting the exact top often underestimates the market.

The trader who focuses on managing risk survives every cycle.

The real survival formula is:

“Don’t try to predict the storm. Build a boat strong enough to survive it.”