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It's probably just greed, and a little feeling of FOMO when I read all of the bullish information being posted on X. Plus as a personal "rule", if I have more than six to seven months worth of monthly expenses saved, the rest I should invest. But everything I like, like Bitcoin and Gold, looks "expensive" now. The only strategy to do is DCA during the current market condition.
I don't know how gold is relevant.. except someone who is lost in regards to the value of bitcoin, and surely at most, you might hold up to 10% of the size of your bitcoin investment int gold and even 10% is probably too much.
A Gold investment is another hedge against inflation, but with lower volatility. I believe that's relevant especially today that Central Banks have been the largest buyers, accumulating since 2020.
Personally, I have a small investment, which I may add more if the price DIPs.
Surely, we have the idea of ongoingly investing into bitcoin and perhaps keeping up to 3 months of expenses in an emergency fund... So if you have money that is beyond 3 months of expenses, then I would consider them to be reserve funds, which means that you can use them for whatever you like, including for emergency purposes if you were to have an actual emergency situation come about.
So surely, if the main reason that you are holding an extra 3-4 months of cash is potentially buy dips with that extra, then that surely seems to be too much cash to be holding to for the purpose of buying dips that might not happen
. Of course if you had not been buying bitcoin for the past year or more, then of course, your cash reserves would be building up - and Many of us likely realize that even a guy who might be saving up 15% of his income, it may well take him a couple of years just to build up 3 months of his expenses in cash (since 3 months is 25% of a year.. which would mean that if a guy were to be holding back 25% of his income for emergency/reserve funds, it would still take him a whole year to get to 3 months). Unless there is any particular reason to be holding such cash it seems to be problematic to be holding that much cash, since by the time you get to 6 months or more, your cash might be losing value nearly as fast as you are able to add to it.. which is part of the problem with ongoing debasement of the dollar and other fiat currencies..
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OR the DIP will happen, but it wouldn't be as low as the current price. That's probably why DCA using small amounts of capital relative to the total + having the rest ready to Buy the DIP in case it crashes would be a more effective strategy during the current market condition.
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It's not merely about "not having enough of Bitcoin". It's also because holding cash as savings would go down in value.
Yep.. Not a good position to put yourself in to be holding so much cash, even though when there is a dip in the BTC price, there can be some psychological pleasure to be able to have a decent amount of money to buy such dip, when it finally comes.
As you likely realize, ever since October 2023, we have ONLY had a couple of dips that were around 30% or more which would have had been the drop from $73k to $47.5k and the other drop from $109.3k to $74.4k .. .. .. I suspect that you have not bought since 2022-ish... so yeah, you have likely been building up your cash since early 2023... which I consider to be problematic... yet of course, guys will do what they are going to do.. .
By the way, a more core consideration is whether you have enough bitcoin or not...
If you have enough bitcoin, then it really does not matter if you might be holding extra cash, yet if you still do not have enough bitcoin, then that remains the more fundamental question that should motivate you in regards to your cashflow management and how much cash you are holding in reserves. You are likely making a mistake if you have already concluded that you don't have enough bitcoin, yet you are allowing your cash to build up because you are waiting for price dips that might not happen and even more problematic that you have likely been holding onto cash and allowing it to build up since around early 2023-ish... but hey, you do you... and hopefully others are not employing such strategies that seem to overly emphasize waiting rather than ongoingly buying bitcoin until you have enough or more than enough.. which is the most fundamental question..
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I may feel that I have enough Bitcoin, but I know that keeping my savings in cash would bear an opportunity cost + inflation risk.