There is always a trade off when you hold back money for buying the dip. I am not necessarily opposed to it as long it is not a central strategy for newbies to be buying the dip and also for the newbies to be recognizing that there are trade offs when they are purposefully holding back money with the idea of potentially buying the dip.. rather than mostly focusing on buying regularly with whatever budget they might have.
If newbies do their research well, understand the market history well, and prepare their capital as well as psychology well enough, I think waiting for dips to buy is good strategy. It's good strategy but not best one, because of a missing point in their mind.
It does not seem like a good strategy to me, unless they are at least putting 75% of their allocated amount into bitcoin every week and only holding back 25% or less. I am not going to agree that it is a good strategy to hold back more than 25% for buying dips, especially for newbies.
If newbies know a fact that dips can occur anytime, and it means it might occur after a mini bull run, or a long bull run. So if a 20% dip occurs after price already soared 50%, buying in that dip is not better than if you simply do DCA like 2 or 3 months previously with a same price. Sometimes, waiting for dips will lift your entry price, not average it down like how DCA strategy is supposed to be practically.
You sound distracted into irrelevance. A lot of time, newbies should be trying to focus to buy as much bitcoin as they can on a fairly regular basis for at least a whole cycle, so I see hardly any value holding back money to buy dips.
Surely, some newbies might be able to start out with a lump sum, so with any lump sum, I can see maybe dividing the lump sum into three parts and have one part for buying right away, another part for Buying dips and another part for DCAing. So maybe a newbie who has a income of $30k per year, might be investing $100 per week DCA, but then they might also have some lump sum that they are able to invest, such as $6k, and then maybe the divide $2k to each of the three categories, yet since they are already DCAing $100 per week, then maybe they divide the $6k into two parts $3k for buying right away and $3k for buying dips... and then perhaps decide in advance how much of an increment to buy dips, and so if the BTC price is currently $87k, then maybe every $2k dip they buy an additional $500, but that is ONLY going to give them 6 buys starting from $84k-ish and down to around $74k-ish.. so maybe the various dip buy amounts and intervals would look something like this:
$84k - $500
$82k - $500
$80k - $500
$78k - $500
$76k - $500
$74k - $500
Sure the amounts could be smaller or larger and the increments can be larger or smaller. i doubt that newbies should be fucking around holding back a bunch of value and waiting for large dips.. but instead structuring their dip buys within their budget and perhaps some of their other beliefs, with an emphasis on buying regularly rather than either getting too greedy or having price gaps that are not likely to get filled.
Even thoughts that $74k could be reached may well be a fantasy that a newbie should be attempting to be more realistic and not overly occupying himself speculating over dips that may well not happen.
Consistently doesn’t really have to be a process of buying with huge amounts that is why it is necessary to always have a reserved funds, and emergency and floating funds. This can really help us to dive into the market and enable us to be consistent and aggressive to buy smart.
In all your consistencies and aggressiveness in your purchases, leave your emergency fund out of it, plan your purchases around your discretionary income, manage your cashflow properly so that provisions for your consistent purchases are made without your emergency fund being utilized in the process. This is necessary for your holdings to survive longer. Taking chances with your emergency fund is only endangering your portfolio.
exactly I agree with you on this one no matter how consistent and aggressively an investor want to be in accumulating bitcoin he or she should never use his or her emergency fund to accumulate bitcoin, because using your emergency fund to accumulate bitcoin is a very wrong approach to bitcoin investment and it can endanger your bitcoin investment and make you sell in lost when emergencies arises and there is no emergency fund to handle those emergencies, which is investing mistake, only accumulate bitcoin with your discretionary and avoid been tempted to tap into your emergency fund to accumulate bitcoin aggressively or consistently, for that is the best way to approach bitcoin investment.
Yap, but sometimes you may come across some Bitcoin price that you are less likely to face any difficulty in increasing the holding more aggressively and holding it for the long term but a part of the backup fund can be used. Suppose you have a one year or two year backup fund that is ready for the long-term cycle and if the dips event occurs in between aggressive buying can greatly positive affect the increase in holdings.
It makes no sense for any newbie to be holding excessive funds in dollars rather than investing into bitcoin, so why the fuck would they be holding 1-2 years worth of cash? It is already a struggle to get back up funds between 3-6 months, an there is no reason to build up back up funds prior to investing into bitcoin.
Maybe if a person has been investing for a whole cycle or more he might have had invested a year into bitcoin and have a year of back up funds, but even that sounds unrealistic and overly skewed in the back up funds direction.
Investors can follow a method that they additionally save floating funds with their backup fund to get the dips season and buy more.
You sound overly skewed towards holding dollars rather than buying bitcoin, and so when are you going to buy bitcoin.
Even in your own case, you have been registered on the forum for a bit longer than a year.
You likely would have had been way better buying bitcoin aggressively during that last year, and what were you doing? Fucking around building up your cash reserves? You are not going to get anywhere building up cash reserves, especially as a newbie.
In that situation, those investors may not need to use the backup fund. Some may consider keeping the backup fund for more than six months. Your investment success may depend on your financial situation. If you have additional funds for more than two years, it may be a lazy fund (Bitcoin stashing could provide further financial advancement) but accumulation Bitcoin in the DCA method every week/month can be more positive.
At least you recognize DCA as potentially better, but you still sound lost, as if you have not been putting whatever theories that you are talking about into actual practice rather than talking dumb and inapplicable theories that are not going to work very well in the real world.
In conclusion I would recommend that you have a backup fund to invest in Bitcoin for the long term, but the freedom to manage each of your financial capabilities and alternative income and floating cash funds depends solely on your own perspective and ultimately, a fruitful strategy for growing your Bitcoin stash.
I have a hard time understanding how your strategy results in actually buying bitcoin since you are seemingly overobsessed with building up cash and back up funds, and what good is that going to do without also building up a bitcoin stash, as you suggest that you would like to supposedly grow such bitcoin stash.