Post
Topic
Board Speculation
Re: Buy the DIP, and HODL!
by
Ruttoshi
on 25/05/2024, 18:04:55 UTC
The risk level is relatively high in short-term investments because they are always interested in buying BTC at a dips price but they forget that it may dips further. They may even fall behind the sales target at some point. Sometimes technical results may not work because market conditions are a reflection of buyer and seller interactions. Normal inflation and environmental factors may affect the market which is normal. However, DCA method of buying BTC should be considered for easy continuation of investment. Through this strategy, the objective of buying at regular intervals is a mixture of different prices in the market, which is to reduce the level of buying when the price is high and to increase the level of buying when the price is low. As a result, more BTC can be accumulated for the same price.
Personally, bulk buying of Bitcoin isn't my thing, I have never tried it and I wouldn't say I hope not to, I would like to if the opportunity presents itself but, am not sure am going to plan for that by having to save up some money while waiting out for rye market to dip. No, that's not want I would want to do or advise of anyone.
At the end, technical analysis isn't exactly bad though. It gives insight not on an individual perspective but on the whole of some possibilities that could be expected with certain moves on the charts. Sometimes, it plays out and at other times, it doesn't.
Hence, you don't base an investment on that.

This is why DCA offers an uneven advantage as, it doesn't give any of these means to analysis a priority but centers on the final or expected goal, with patience to serve as the straw on the paths to your goal.
If you are not doing DCA and trying to buy only on Big Dips, then you need to continuously remain in touch with Bitcoin price and try to figure out yourself dips and big dips. The only thing we don't know is that the price we buying is the bottom or just the start of dip. These are things you have to keep in mind if you are not doing DCA.
If you are not in DCA and have huge cash then buying at one price is also a good option provided you are willing to HODL for a longer duration. Lump sum investment becomes more profitable if you correctly caught the big dips. But again there are trade-offs, in Nov 2018 price of Bitcoin was around 5000$ while in Nov 2021 price of Bitcoin was around 65000$. If you have your Lump sum investment at 5000$ and you are willing to HODL for 4 to 5 years then results will be very much positive.
It all depends on the accumulation stage of that investor that lump sum will be a good accumulating strategy for him. Someone new into bitcoin and wants to start investing does not need to use the lump sum strategy because he wants to buy at the dip. That investor needs to use the DCA strategy because it is most convenient and flexible as long as you are using your discretionary income to invest in bitcoin often either weekly or monthly, so that he can gradually increase his bitcoin portfolio as time passes by. The reason is because for you to lump sum, you need a good amount of money, and if your discretionary income cannot give you such amount, you will have to start saving this money in the bank for it to get to the amount that you feel is cool for you to lump sum with. Some people can even take one year or two just in the name of piling up fiat so that they can lump sum at the dip. Wasting the time that those money that they are piling up in the bank should be channel into bitcoin as it comes in so that they can start piling up in bitcoin than fiat that depreciates overtime.

Another disadvantage of buying once and not buy again is that, you will not be able to buy bitcoin at different price level which is the trick of using DCA to take advantage of the volatile nature of bitcoin. You might lump sum today, and bitcoin price dips, you will be at loss not until Bitcoin price goes higher the amount you bought. This is why new investors should only focus on the DCA method in the beginning, which gives them the opportunity to buy with whatever amount of discretionary income that they have also at different price level. If an investir have reached 50% of your bitcoin portfolio and above, you can use lump sum. However using both DCA and lump sum after two years of your regular DCA buying weekly or monthly, is very good if you are opportune.