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DCA

The Bitcoin DCA Strategy Easily ExplainedIn this post, I want to go over a strategy that beginners can implement with any asset or commodity that have solid fundamentals. Disclaimer: This is not investment advice. This is for educational and entertainment purposes only. I am not responsible for the profits or loss generated from your investments. Trade and invest at your own risk. Explanation - A lot of people have a hard time timing the market, and buying the exact bottom of a dip. - In this post, I want to explain a strategy that the average joe can use, in order to optimize their average entry price of their position - DCA, or Dollar Cost Averaging, is when investors divide up the total amount of capital they're willing to invest in, and simply invest a portion of it regularly, regardless of price action and volatility. - So for instance, buying Bitcoin every Monday regardless of whether it has formed a new all time high, or has corrected 30% from its local top, is an example of DCA. - We can apply this idea with a slight twist, and aim to buy the local dips. - Above, we see Bitcoin's daily chart on the logarithmic scale. - The 5 Simple Moving Average (SMA) is marked in blue, 20 SMA in green. - A very simple DCA strategy would be to buy at the 20 SMA when the 5 SMA is at a downtrend. - Looking at the price action of the past, we can roughly backtest this strategy. - The points marked by the red circle would be regions where we would have entered a position for Bitcoin. - Given that we enter $10,000 for each position, we would have entered a total of $50,000 at $25k. - Giving us 140% returns, this would amount to $120,000 today. Conclusion If you're struggling with technical analysis and you're having a hard time educating yourself on buying the right dips, refer to this idea, and try to think of your own way of dollar cost averaging through a simple strategy, as simple as referring to the moving averages. If you like this educational post, please make sure to like, and follow for more quality content! If you have any questions or comments, feel free to comment below! :)
BITSTAMP:BTCUSD
by Michael_Wang_Official
117
CORNHUB! Bitcoin through March and beyondI'm honestly just not feeling this rally yet. I don't even want a breakout right now. I would prefer we reset all technicals at $42k before we make the next move up. To be clear about the green and red bubbles, those are in reference to the key of Bitcoin: DCA (dollar cost averaging) Red means wait to DCA later. Green means stack sats. SO.... HODL on comrades, don't trade BTC!! You'll get REKT. BTC gives AF about short/midterm TA, so just stack and HODL. Bitcoin ONLY respects the 4 year halving cycles and will rip your face off if you try to get cute. Follow this chart, hit that like button, tell me what you think about this short term analysis and give me a follow! Thanks! (Calling Bitcoin "Bitcorn" is a meme, if you see people talking about the price of "corn" they probably mean BTC. Get yourself some more corn so you won't be hungry later!!)
COINBASE:BTCUSD
by RickSmash
5
DCA zone for AAVE This is another crypto that I think has some legs on it. $4 B mkt cap is not large, but not small. I could see it near $1000 in the foreseeable future. This projection is based on some patterns I've been noticing in a lot of charts, so I really want to see if it plays out that way as part of my chart studies. There's nothing technical in the chart that gives merit to the exact pattern I've drawn. I enjoy making my calls before confirmation, just for sport. The current correction isn't very deep so maybe it could drop further. Not a scalp trade imo. This is a nice place to DCA because it is riding the 50 day EMA. Decent longterm entry.
Long
by RickSmash
1
Bitcoin potential falling wedgeBitcoin could form a potential falling wedge. It could as well as break upside as each triangle breakout as it could range lower for the whole February month like in 2017. If it ranges between 27,000$ and 30,000$ for one month, it could finally touch the SMA 100 which is a crucial support in a Bitcoin bull market where it usually bounces back, recovers, forms a new trend and reach a new potential ATH. For traders this is a good period to Swing and/or Scalp and for holders to do a DCA and accumulate more bitcoins.
BITSTAMP:BTCUSD
by Nugacity_Fracedinous
2
Current SQ Owners....To current LONG SQ owners: SELL 20% of your position at 214/share, then sell another 50% (ie. 40%) at 238/share. Stay out and wait for a healthy (8-15%+) market pullback/correction to re-enter. (likely/maybe late late Feb - April 2021). SQ is hitting the ascending channel (blue lines) like a CHAMP! I'm so bullish. On the chart you'll see a rogue ascending red trend line, which started in late September 2018, and will be burdensome resistance for SQ mid to late Jan 2021, is my hunch. March 2021 SQ earnings may be the catalyst to raise SQ again, organically, after the market-wide pullback/correction, else, maybe June 2021. Seems like forever from now! BUY more SQ shares (Dollar-Cost Average): 1. anytime below 177.0/share, 2. after a market-wide correction (10%-20%), 3. SQ just correcting itself, say 15-20%. As it's done up the ascending channel thus far. There is suitable support at 170.7/share. Just follow the lime-green arrows everyone, I am. Cheers, Cryptmando Status: Dec 01, 2020 (not trading or investment advice, I just like numbers, and I'm a trendy guy ;) )
NYSE:SQLong
by Cryptmando
1
Bitcoin - DCA Guide (Dollar Cost Averaging)I've found that the Bollinger Bands that I use for investing in the stock market, also do work well for Bitcoin on the weekly chart. In addition to just regular dollar-cost-averaging (DCAing), you can also purchase BTCUSD aggressively when the RSI falls below 40 and/or price goes below the lower Bollinger Band. I do not however recommend taking profit at the upper Bollinger Band. This is because when Bitcoin again goes on it's raging-bull / moon-run rampage, it will disrespect both the upper Bollinger Band, and the RSI. This strategy is best used as a companion to regular DCA methodology. Note: Disregard the strategy performance chart below, as the Bollinger Robot is not tuned to buying crypto - so there are insufficient orders for the performance chart to show.
BITSTAMP:BTCUSDLong
by TsangYouJun
BTCUSD Trading Idea going into 2020Personal outlook - Not investment advice, serves as a note to keep track. This is focused on optimizing the process of dollar cost averaging into Bitcoin. The initial buy in (~15%) to be placed at the 50 week moving average expected in November. The second buy (~20%) to be placed at the long time support around 5900 which may coincide with the 200 week moving average coming up by January 2020. If this strong support breaks (unlikely) add %25 around 4500-5000 if the MACD is signaling a cross (April 2020). As this is now fairly well positioned for the long term, only add ~10% more whenever a correction above 25% occurs, preferably in August or November 2020. Closing Strategy: DAI
COINBASE:BTCUSDLong
by svg1996
Risk Management: Satefy Orders (Dollar Cost Average)I believe risk management is key, because sometimes, finding the perfect entry will not be enough. The market is what it is, and nobody can predict with 100% accuracy how the price will behave, even with all the great indicators we got out there. With that in mind, we should come prepared that the price will go against you, and we should take advantage of it, because most of the time it will bounce back up. This technique is especially useful in trading low timeframe also known as Scalping. The idea is to lower the inital entry order size , and split the remaining order size progressively through the safety orders as the price goes against you. This will make the total trade average entry - or break even - at a lower place than if you were simply trading the initial entry. That means the take profit will also be lower, because we can now take profit from the total order size/volume . Here is a simple example with a long: We buy in on the `LONG` label with 10% of our trade capital at around 9325$. Our take profit is 1.3% which makes a 9447$ target. But the price goes down, until it reaches our first safety order trigger line, at around 9231$. At this point we add 10% of our trade capital. It is the `DCA` label on chart. The break even line is now in the middle of the inital entry price and the safety order price, around 9275$. We still have our 1.3% take profit target, but it is now at 9396$ instead of 9325$. At last, the price bounces back up, as expected, and we take profit. Example with a short with 2 satefy orders: What are the risks? In the worst case scenario , which we know will happen at some point, the price does not go back up. It is important to know what are the risks so that we do no get liquidated or lose too much of our account. Let's dive into the numbers. We set up our strategy so that we have 3 satefy orders max, and the stop loss is on step below the last one. That makes 4 entries in total, and we decide to use 1% of our capital on each entry. Each step is seperated by 1% of the price to make things easier. When we hit stop loss, how many % do we lose? 1. On first safety order, price is down 1% and we traded 1%. That's 1% drawdown. 2. On second safety order, price is now down 2% for 1% of our order, and 1% for the other 1%. That is 1.5% drawdown. 3. Of the third safety order, we get 3% + 2 % + 1% = 6%/3 = 2% drawdown. 4. On stop loss, we get 4% + 3% + 2% + 1% = 10%/4 = 2.5% drawdown. => The price went down 4% but we only lost 2.5% of our inital capital. That is why we can say that safety orders reduce risk . /!\ Using leverage will multiply the risk. Using 2x we would have lost 5%. This can climb very fast, so be careful. One thing we can do when a stop loss is hit is to reverse our order, as most of the time our stop loss is hit because the trend is reversing. But again, be careful as it could cost you double.
BITMEX:BTCUSD.PEducation
by cyatophilum
5
CVC: The hidden gem with a dark sideCVC (Civic) is a hidden gem with a dark side. With a market cap of only 20.12 M, this coin has quite a good history of scalping, as well as being stuck in a sideways rutt for months. Its an interesting coin to trade simply because of its unique behavior, however, one must understand the risks involved. This coin has a low market cap, so additional care must be used while trading it. Also, the dynamics of such a coin do require a bit more of a budget to manage its unexpected drops. This type of coin is really a very good coin though, for a saving account paradigm (constant dollar cost averaging at fixed percentages or steps), with the proper budget. 100 leverls at 1% of a linear base level can result in consistent profits, but don't be complacent about your risk assessment.
Long
by RobertD7723
VWAGY (Volkswagen) - WeeklyShort term forecast for long term positioning Looking for a reversal within the coming month & eventual downwards trend towards the DCA zone Recent news: Volkswagen recently restarted operations amid concerns of actual demand within the global market. FA: From 2018 to 2019, Volkswagen saw a 20+% increase in yearly net operating earnings generating up to just over $16.9 billion. As a major player, the company is well positioned to adapt to future automotive trends, given they continue to embrace smart car innovations. Due to the current global environment and reasonably forecasting decreasing demand for vehicles for at least the short term, it wouldn't be a surprise to see price action return to the range between 10.65 - 14.51, this area may serve is a good opportunity for securing some longer term positions via DCA. Always DYOR & keep risk managed :) *Disclaimer: The above analysis is an expressed opinion only and should not be confused as professional financial, investment, trading or legal advice.
OTC:VWAGY
by MomentumTradeWA_Investor
LTCUSD - Still long on weeklyFrom my last idea about COINBASE:LTCUSD on the weekly: "Personally, I feel this a valid time to accumulate given the very bullish news around crypto and blockchain technology in general in the last few days. I plan to hold for a while as the ratio is very low vs. BTC , see: COINBASE:LTCBTC . I'm a very firm bull on COINBASE:BTCUSD but also believe that LTC is at a low ratio, and with great signals for a potential trend change vs.USD." This was while price was at around $58. Key takeaways now: Stochastic appears to be turning upwards while on a red candle. Means it is hard to push that indicator down at this time. Bounce from bottom BBand. MACD histogram getting really low, potential crossover still. Green 50 Week MA forecasted potential cross above Yellow 100 Week MA in about 6 weeks with current prices. I still feel like this is an excellent time to accumulate. Only thing I don't care for is the Stochastic RSI still heading downward, however this indicator is quick to move, so solid bullish movements will correct it quickly. DISCLAIMER: For educational and entertainment purposes only. Nothing in this content should be interpreted as financial advice or a recommendation to buy or sell any sort of security or investment including all types of crypto. DYOR, TYOB.
COINBASE:LTCUSDLong
by BigBitsIO
BTC bouncing, volatility rising, the good, the bad, the ugly?Dear fellow readers! Haha, this is what I actually do like so much about this market, yesterday bear, bear, bear, today bull, bull, bull, tomorrow bear again, nobody knows :D? Is this going to be the all awaited beginning of the bounce? Have we bottomed yet? If it pumps, will it hold the level? So many questions, but basically no clear answers. The only thing I can tell from the chart is, at the moment BTC currently seams to be consolidating forward, but for now BTC respected the green trend line starting with February’s pump. If you take the orange trend line, starting from the last years absolute low to the the beginning of this years January low, into consideration, it shows me, that there is further downside potential. Since that is also around the time, where this 48.5k BTC whale started selling. For now, the remaining 45.5k BTC (44k/1.2k/300) are still parked and have not moved, another 80 BTC have been sold and 100 BTC waiting to be sold. The 61.8% fib retracement seams to hold so far, but if you switch to the weekly and take also the RSI and MFI into consideration, this is indicating to me again, that there is room to the downside. In my personal view, I hope that BTC will further retrace to a level of around 4.5k EUR resp. 5k USD. In my opinion, this would be a proper and healthy retracement level, after this year’s insane pump, so I am waiting for the weekly BUY Signal flashing up, from the MFI+RSI Indicator I am using. As a conclusion, just DCA, wait and chill, you won’t become a millionaire over night anymore :D. Thanks for reading, If you are not conform with anything I write, just drop a comment and feel free to start a discussion, I do not want my readers to believe all I am writing is fixed on stone, I just try to have a view on the big picture and if I am maybe missing anything, I would be glad to take this piece of information also into consideration. Keep up educating yourself, take your finances in your own hand, short the bankers and long BTC! I will keep you updated regarding further research Cheers I'm not a professional market analyst nor am I a professional trader and this shall definitely not be of any financial advice. Do your own research and try to understand the fundamentals regarding any investment you take into consideration. The websites and projects “advertised” are not mine, nor am I in any marketing or affiliate relationship with them. Personally I am invested into this project, so of course I am biased, that is why I tell you to get educated and do not just put money in anything, because somebody on the internet is writing good about it, scrutinise critically and if you are more than confident, do whatever you want for your good.
Long
by markuso116
1