wait and watch policy is right for purchase altcoin for the long term?
The end pretty much answered the whole question.
How much to watch if waiting?
Check the roadmap and look at the product development, marketing and partnership deals. Assess for yourself if you are still satisfied with the project's progress.
When should we make a profit and get out of it?
Timing is different for individual investors but I can tell you to get out when the project turns out to be a shit. The team failing to deliver or other legal instances. Just take a look at those who were long on XRP before. They ditched the coin when they realize SEC isn't joking around.