#BuyTheDip

Buy The Dip (BTFD) means purchasing stocks or crypto during price declines, assuming prices will recover. The strategy became a meme during 2020-2021 bull markets when every dip was bought instantly, but faced brutal reality during 2022 bear market.

Origins

The phrase emerged in trading forums in the 2010s but exploded during:

• 2020 COVID crash: March dip recovered in months, rewarding dip buyers spectacularly
• 2021 bull run: Every Tesla, crypto, meme stock dip bounced within days
• WSB culture: “Buy the dip, f****t” (BTFD) became rallying cry

The Glory Days (2020-2021)

Dips that worked:

• March 2020 COVID crash: SPY $220 → $450 in 18 months
• September 2020 tech pullback: QQQ recovered in 2 weeks
• May 2021 crypto crash: BTC $30K → $69K in 6 months
• Every Tesla dip: TSLA $500 → $1,200 (split-adjusted)

This conditioned an entire generation to believe dips always bounce immediately.

The Reckoning (2022-2023)

Dips that kept dipping:

• January 2022: “Buy ARKK at $75!” → Fell to $35
• May 2022: “BTC at $30K is a gift!” → Fell to $15K
• June 2022: “Tech stocks are cheap!” → Fell another 20%
• Every 2022 rally: Bear market rallies lured in dip buyers, then crashed again

Phrase evolved to “catching a falling knife” and “escalator up, elevator down.”

The Strategy

When it works:

• Bull markets with healthy corrections (5-10%)
• Overreactions to temporary news
• Quality companies with strong fundamentals
• Having cash reserves to deploy

When it fails:

• Bear markets (dips are starts of longer declines)
• Failing companies (Bed Bath & Beyond dip buyers lost 100%)
• Ponzi schemes (Luna dip buyers at $30 → $0.0001)
• Trying to time the exact bottom

Better approach: Dollar cost average on the way down, not all-in on one dip.

WSB Wisdom

• “The dip before the dip before the dip”
• “Buy the dip” → “Buy the dip’s dip” → “Average down” → “Bankruptcy”
• “It’s not a dip, it’s a crash”
• “Dip machine broke” (when it keeps falling)

By 2023, “buy the dip” remained valid for long-term investors with dry powder, but the 2022 lesson was clear: dips in bull markets work; dips in bear markets are traps.

Sources:

• r/WallStreetBets historical memes
• Market data: March 2020 bottom, 2022 bear market timeline
• Bloomberg, CNBC coverage of dip-buying culture