what am i missing exactly?
The point of dollar-cost averaging is to buy an asset daily/weekly/bi-weekly/monthly regardless of price. Basically a "strategy" that acknowledges that you can't time the markets so you're just going to average in instead. Starting to DCA only at a certain price sort of somewhat defeats the purpose.
I'm not saying that you shouldn't do it or that what you said is a bad strategy; but yea.
... a bit of misunderstanding here, due to lack of clarification from my side:
I don't do the classical DCA but rather carry out the scenario (when DCA is required) like this:
Rely on my signal to buy an amount of asset, predicting that it will go up certain % within certain time period (according to my calculations, right? I work for me, so i must be right
). I'm wrong and the price drops. I keep my cool.I wait for my next buying signal for the same asset - as if I hadn't bought at all - and I use that time to buy required amount (I'm sure everybody can calculate that!) again to bring it back to within less than 0.5% loss (a bit hard to do if it went down big time, it takes a lot of money if the original order size was big).
If I'm right this time, it takes just a small movement in the right direction to recover the lot and get some profit.
If I'm wrong again, that's where it starts to get hairy - my next signal might be even deeper down and it might not even work, again.
But I stick it out and it works, due to two things: I don't invest a lot to start with, and downturn as well as upturn goes in waves, not in the straight line, so I catch the bottom of the wave, eventually.
Most of the time I make a lot more profit after DCA than with my original investment, due to the vastly increased size of the trade.
Hope this clarifies things.
P.S. I don't buy or sell signals, I code my own using pine script on TradingView. So - when it misfires, I know who to blame
