Dip market is good for buying crypto.
According to investor SALID
But you need to make sure you get maximum profit. follow cost averaging swing trade strategy.
Swing trading is usually for short term trading. Instead of getting entry at once, we enter slowly in different price points when we know market will rebound. But now, you will see all long term investors are following this strategy. For investors, the method is popularly known as Cost Averaging (CA) or DCA (Dollar Cost Averaging).
Now we need to know when this strategy is actually useful: when to use and when not to.
When to use in spot or buy order:
1. Market is going down dramatically,Like minimum 3% everyday.
2. Market has enough trade volume.
3. The project is matured, well established and stable.
4. The price is above NP, and not at ATH.
5. You know market will rebound.
When not to use:
1. Market is going up suddenly. Like 10% up a day.
2. There is not enough trading volume. The crypto act like stable coin.
3. New projects or a project that is not stable.
4. The price is below NP, or at ATH.
5. When you have very less money to invest in each coin. Like 100$, 200$.
6. When you know the coin price will never go down, it will keep going upwards.
Let me give you a good example of cost averaging swing trade. Let’s say, this month BTC may go 50k and then rebound back to 71k. Now either, you wait till 50k to buy, but maximum time you will lose the opportunity. Or you can buy 25% at 65k, 25% at 60k, 25% at 55k and so on as it drops and goes below you buy 25% at 50k. In this way you are limiting the risk of losing the swig opportunity, and ensuring that you get maximum profit.
But if you start applying this strategy when it’s not swing, just continuously growing up, you are actually missing the opportunity and reducing the opportunity to maximize your profit . Like if BTC is 15k and you start buying 25% each month, you are literally waiting for higher price to enter. I saw many index funds suggest you to do that in the name of DCA. It’s not advisable DYOR.
