DCA is going to be quite problematic for any coin or project that is generaly trending downard in its price... One thing about any asset with strong fundamentals would be that even if it is trending downward for very long periods of time, if the fundamentals are strong enough, then the downward trend should end up reversing, and sure it is not guaranteed to reverse, and sometimes we might not know that something is a shitcoin until it never ends up recovering.
Surely there are some shitcoins that end up having second lives, and so there could end up being some value in DCAing into them and then getting out during one of their recovery periods... but yeah, would we call that investing? Probably we would call it trading and/or gambling... depending on how wild the coin is and if there might be some reasons that the coin/project actually has meaningful/substantial value beyond pumping and dumping.
DCA is a strategy that can be used in several investment not just Bitcoin alone.
I want to get something clear here, is it better to DCA in an asset when it is experiencing a high upward trend or DCA when its experiencing a serious downward movement?
Of course, if you think that you know that the BTC price is going up, then it is better to lump sum and/or front-load your investment into BTC rather than DCA buy, yet part of the problem is that normies (regular people) neither know for sure about BTC's price direction and they might ONLY be able to front-load or to lump sum buy so much into bitcoin based on their own amount of money that they have available to them at any given time. Sure there are some folks who might have other investments, yet think about it, there might not be a lot of circumstances in which they are going to have enough confidence that it would be worth it to transfer their value from one investment to another (and yeah if they have various kinds of reserves, they still might not have enough in order to invest into something like bitcoin, since it may well be o.k. to take from reserves and cash floats, but it may not be a good idea to take from what they consider to be their emergency funds in order to invest in bitcoin - it would be bad to do that).
So some of the advantages of continuing to invest into bitcoin using DCA, whether you perceive the price to be going up or down (and not really knowing) is that you are figuring out how much money to invest into bitcoin every week or every month as your money is coming in.. and you are building up an amount that you end up having invested and/or saved into something that you might NOT have had otherwise done through other methods because it can become quite difficult to just set money aside and to wait for some kind of an opportunity to invest into something, whether bitcoin or something else.
Another issue of the BTC price going up is that if it keeps going up, then you still are better off for your having had bought BTC along the way rather than waiting and/or spending a bunch of time and energies trying to figure out some strategic time to buy, yet the theory is that if the BTC price continues to go up a lot and even in a way that seems unsustainably high, then you may well reasonably conclude that good chances are developing that there is going to be some kind of a correction lower than the current price, so that you can buy cheaper, which may or may not be a good prediction... but it does become more and more reasonable of a prediction the higher the BTC price goes and the faster it goes to those higher prices.
In regards to buy BTC when the BTC price is going down, of course, it would be better to wait and to buy when the BTC price is at or near its bottom, yet again, how are you going to know when the BTC price has stopped going down or that the BTC price is getting somewhere near its price bottom? You could end up spending a lot of time trying to figure out if BTC price is going lower and then you end up being wrong, or you end up being overly whimpy because you are continuing to hold back in terms of the timing of your investing into bitcoin. Sure after the BTC price already goes down, it seems so apparent that BTC prices had to go down, but rarely is there any kind of an ability to figure out those kinds of price dip matters in terms of either how long it is going to stay down or how low it is going to get.
In DCA, you keep buying without really knowing which way the BTC price is going to go, and you set your budget according to your discretionary income, and maybe you choose to be aggressive or maybe you choose to be more whimpy in the amounts that you choose to invest weekly, but you still are somewhat in control of determining the amounts that you are going to put in and contemplating about whether it might be better to hold some of the value back for buying on dips or just to invest all of your authorized amounts on a weekly basis (or whatever happens to be your investment period of time).
You may end up incorrect if you try to guess too much about BTC's price direction and then end up regretting that you were holding back too much value, so each of us needs to make those kinds of choices in regards to if we believe that we have enough BTC, or we believe that we are sufficiently (financially and psychologically) prepared for UP, or if we think that waiting might be better than just continuously and persistently buying BTC in some kind of a DCAing manner....
Another thing about DCAing is that you can adjust it so that you are not necessarily engaging in all or nothing kinds of investing, and so maybe instead of buying $100 per week, you decide that you are going to buy $50 per week or some other amount that you believe to be reasonable for your circumstances, yet if you end up being wrong and/or overly whimpy in your BTC buying then you have no one to blame but yourself for those kinds of choices. You could also become overly aggressive, yet surely in various other threads we have already discussed how having and emergency fund, reserves and float can help to protect you if you had become overly aggressive in your BTC buys, yet at the same time, you might not really realize or know that you had been overly aggressive until some kind of an emergency comes and you do not have enough money to deal with it, and so part of the sign that you fucked up is your own getting somewhat reckt.. or maybe having to dip into too much of your BTC at a time that was not completely at your own choosing.. and surely some folks may well realize that they fucked up, even before getting to a point of having to sell any of their BTC, and when they are starting to dip into their emergency funds and getting to a point of realizing that they don't have much of a cash cushion, then they are realizing that they had already fucked up by some of their earlier spending decisions and/or actions.
In the end, there likely is no real wrong choice except for if you might not be tailoring appropriately what you do and/or how you balance your BTC investment amounts to your own financial and psychological circumstances.
Because when its going so high, through DCA we are buying at a very high price and we keep buying so high as the price increases, what if it never stops? While when the price is dipping so badly we DCA continuously. Which is more beneficial to an investor with time?
Yes it is better to buy BTC for lower prices when you are able to do so and/or if you have some kind of inkling that BTC prices might get lower, but how are you going to know that they are actually going to go lower beyond some kind of sense of momentum/sentiment.. and at the same time, momentum (or sentiment) can frequently change, so you cannot really rely upon those kinds of assessments, and it would not be a good outcome if the BTC price ends up going way up, and you were too busy preparing for down rather than up, and then you regret because you had not bought more BTC while the prices were lower because you were too busy preparing for down rather than sufficiently/adequately preparing for up.
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Which in all honesty is probably more gambling than trading. I mean it is probably not that simple as there could be an extended debate about what is trading or gambling, but when it comes to catching these shitcoins with "second" lives, I think that's more gambling. There are coins though where someone might consciously not trade the fundamentles because they are trash, but herd behavior and market psychology. If I am quite certain that something will go up in price despite knowing that it is a shitcoin, then you could probably call it gambling and trading. I trade the sentiment instead of any fundamentals. But given how often these shitcoins have failed (or rather how many of them), catching these second live things has become very rare. I can tell that the last time I bought something other than bitcoin is a very long time ago. Except for coins I used for quick transfers, like USDT on the Tron Blockchain or TRX, but I don't really own it as an investment. Sometimes I have some because I pay for my VPN or something and bitcoin is definitely not always the best option for that kind of payments.
But JJG the difference is that we do some analysis here and know that sometimes you trade fundamentals or you can trade the sentiment or information you have. Too many people are still stuck with terms like market capitalization or coin price. They have no idea, don't read basic material about bitcoin, fall for the most fancy techn language and check coinmarketcap for low market cap coins in hopes to see those rice to bitcoin levels. That is where it becomes stupid. You know these sentences "but bitcoin very expensive, trashcoin only $0.05, much potential". Some don't even understand the concept as mentioned above. When there is a coin that costs 1/1000th of bitcoin, but there are 1000x the number of bitcoins, they still think that it takes less money to push the price of that trashcoin that to push bitcoin upwards.
Lots of people lack the most rudimentary fundamentals and then I would certainly call it gambling when they buy something other than bitcoin. If someone really puts effort into following a certain portfolio of coins and identifies some pattern, then I would more lean towards calling it trading.
Whenever someone asks me to do what to do to get involved first, it is bitcoin and then go from there, see how the market works, what kind of news might have an impact, take time to get into the little details, and if somebody then decides to give some other coin a shot because the person now is able to contextualize any coin within the bitcoin ecosystem, then feel free to do so. But people wasting their money on some coin from page 288 from coinmarketcap because they hope there will be some dead cat bounce or so, please no...
I surely am not encouraging the trading of shitcoins, but I did want to suggest that there can be some follks who still use some variation of DCA in terms of establishing their shitcoin position(s), and DCA can work with anyone in terms of managing their budget to take money from their discretionary income and to invest into something whether they are investing into something good or investing into a shitcoin, and some folks actually get lured into thinking that they should be investing into shitcoins for some kind of a long period of time.. so they get in early and then establish a decently sized position and then maybe continue to buy through DCA hoping that the shitcoin goes up rather than down.
Regarding trading based on sentiment. I am not much of a fan of trading, including the idea of trying to figure out what to do based on sentiment, though I am sure that is how a lot of shitcoins are pumped and dumped in terms of changes in sentiment and trying to predict changes in sentiment so that you can get into your shitcoin earlier than others and get out prior to the sentiment of the shitcoin turning negative.
As far as bitcoin, if you are investing in the long term, then maybe you are accumulating by either DCA'ing, buying the dip and/or lump sum investing.. So surely you could be accumulating and establishing your bitcoin position for many years 5-10 years or more, and even after 10 years, you might still be working on building up your bitcoin position. so then questions of bitcoin portfolio management might start to come up much later.. when you are either trying to temper your BTC position or maybe you are considering selling on the way up or maybe even time based selling, but either of those selling techniques would fall into ideas of having reached some level of overaccumulation rather than having any kind of design to try to buy back lower than the price that you sell, yet surely anyone who sells prior to the price falling may well want to use the proceeds of his sales to buy more bitcoin than he previously had with the money that he got from the proceeds of his earlier BTC sales.
Ultimately guys will think about these matters differently, and surely if you think in terms of investing, you may mostly be thinking about building your BTC stash rather than trading and/or gambling with it, but surely the more stash that a guy builds, the more his maintenance strategy might start to be formed by other than mere BTC accumulation, and I surely am not much of a fan for anyone who believes that selling BTC (with hopes to buy back cheaper) is going to serve as a reasonable accumulation strategy... and I am also not much of a fan of strategies to buy and sell shitcoins in order to be able to buy bitcoin with the proceeds of such shitcoin trading - even though surely there are a decent number of folks who believe that is a good use of their time, energies and their money.. even when sometimes their goals might still be to accumulate more bitcoin - and yeah accumulating bitcoin through selling bitcoin or selling shitcoins takes additional skills over a pure investing strategy, and even sometimes guys who have very good trading skills may well have very difficult times to outperform a guy who is merely DCAing into BTC - especially the longer the comparison time period... and when we get into the 4-10 year or longer periods, the person who accumulates BTC by DCAing likely is going to outperform the trader and/or the shitcoiner.