Bitcoin Forum

Trading cryptocurrency has always been hectic for some users, instead of going through trading tutorials and courses, they chose the simplest and the most popular method of buying and selling which is dollar cost average. Very easy, effective but one need the mind to take the little loss at the initial stage.
The problem I have encountered with this method is when Altcoins drop by 50% - 70%, its always difficult to make profits as most of take eternity before they make such huge recovery again.
How do you deal with this situations of huge loss on Altcoins?
https://i.ibb.co/25D6R71/bcf4702.png (https://ibb.co/ZNnJv6p)

Why not reverse the choice instead of altcoins, do dollar cost average with bitcoin. I've read some people did this in the past and has been consistently doing this up to now.

No problems were found and no complaints heard from them. With the roller coaster, they are still in profit and focused in doing it.

No matter you buy Bitcoin or altcoins, always you have to follow your strategy and not your emotions. I know how you feel, my altcoin portfolio is down by 70%, but I do not care, I know when the treue bull market comes, everythigng will boom again. See profits on YFI, Link, BNB. If some coins could make thousand percents, why not the old estabilished coins with huge user base?  ;)

Trading needs the best practices and strategies to minimize the risk, and you should have a planned, before you going to trade cryptocurrencies because sometimes shits happen that beyond our control, like the sudden swing of the crypto prices and I'm already experienced that kind of market situation, and what I'm doing is just patiently wait to return the same price level before I sell my coins/tokens just to break even for me it's better than to suffer losses and prolonged waiting and holding period.

Dollar cost averaging only works if you are buying directly with cash but we all know that most of the community stillbuys alts with btc or eth and seeing their investment value continuously dropping in terms of btc or eth is painful.

With this average trading technique, everyone could learn trading in a simplest yet working way. by just simply waiting for the price to rise, you don't have any problem to earn some decent amount of income from trading this way. however, this is not always the case because we have known from the start that the price always has this trait called "Volatility" where most of the time happened in the crypto market. just like what we have seen today.

https://i.ibb.co/HFXghrd/Screenshot-1.jpg

Some of the cryptocurrencies including bitcoin looked bloody today and this is the time when you gonna have some panic whether the price will gonna back to normal again or not. because if this gonna continue, you will have that bad thoughts that the price will not gonna back again to the top.

Yeah no sense chasing a dead cat.  What you want to do is wait for a strong sustained rebound then buy into that.  You'll end up buying too many losers if you buy every alt dip most never come back.

I usually do buy if a coin is dumping to improve my average cost but rest assured i only do it with the coin i truly support and i know that it will give me benefits over time so i will not do this with every coin only the best ones.

The problem is we never know when the lowest dip and the highest peak. It's hard to get the lowest dip when we want to buy nor sell in the highest peak.

Altcoins is more volatile than Bitcoin, 50-70% price changed in altcoins is normal. Sometime you are loss in trading altcoins doesn't from your skills nor method, but your coin/token aren't good.

Litecoin is its all time low right now against btc. Might be a good choice if you want to DCA it from here.

It is nothing special other than being an early btc copy but it has the name recognition, it is worth a try imo.

Yes, and things like that are also done by many other people in crypto, and for the best coins it is not worth saying that they are thrown away, because basically everyone will not throw away their best coins, because the best coins always have a potential profit when someone holds them.

DCA could be a great way to get out of a jam if you bought FOMO at top. However, be very sure if the coin has a future, otherwise you could be cathing a falling knife and get your hands and wallet sliced.
I'm guilty of this myself, bought more and more as the price dropped, and in the end lost alot because it never recovered.

Dollar Cost Average works if you are looking to buy the bottom and you are sure we are at the bottom, but employing this at the top would be suicide, don't use this at the top because it won't matter, long run because you are  surely going to lose money, like those people that bought Sushi at $10

If you are trying to do dollar cost averaging on a coin that is brand new or just not a good one, you are not going to like what happens when you do that. After all we are talking about an altcoin and we have ETH as altcoin as well as some small brand new 20k marketcap type incredibly unwanted coins as well. So which one you deal with changes the result of the dollar cost averaging as well.

If you buy ETH at 400 dollars and rebuy at 340 dollars to drop the average that will be a good move because eventually eth will go back up anyway, it would result with a good profit, but if you go into some small unwanted coin and buy at 7 cents a ton and when it drops to 2 cents you keep buying a ton, you are not going to really like what happens because it will drop even further down.

Dollar cost averaging also work in ranging markets but in longterm downtrend buying the dip is like suicide so it is not that a simple strategy but something very technical and only smart traders know how, when and to which coins this strategy can be implemented.

Dollar cost averaging is not for me because everytime i tried to be smart and used this technique i have grown my losses so i think this cost averaging or buying the dip things works only in the bull market when overall the price is going up only.

Using the dollar cost average in the trading is my first rule for BTC, for ALTCOIN I evaluate different things, everything depend from the BTCT value because if btc is pumping and I buy the altcoin in btc i evaluate their price in this pair

Instead of buying altcoins based on the dollars based price better buy them with a stable coin so you can trade the pair when the price swings and bag some profits.

Dump from the altcoins are unavoidable so make sure you are ready to face the worst dump while you are in the process of making money.

Not an expert, I only have a few years of trading. I usually use altcoin pairs instead of DCA. After many years of DCA trading, I found out that while I did end up with more USD value in my portfolio, I ended up with approximately the same BTC amount I initially started with (+/- 10%).

DCA is very easily influenced by Bitcoin rises and dumps. Playing alts against USD for me was approximately the same, percent-wise, as if I had played BTC against USD all that time. I find it easier to play against BTC instead - and BTC pairs are easier to recover from in case of losses.

I just watch them and eat snacks!
It is so much fun to see rekt pleb's posts on the twitter, I just don't trade in the wild market, I do rather it peaceful, some of them are just dead like $OM and it is not surprising!

It is better not for an ordinary person to trade on stock exchanges without knowledge of analytics. In the long term, such trading will lead to losses and loss of money. Most altcoins are already unlikely to rise in price, so you should not invest in short-term coins that you are not sure about. There is little chance that they will make a profit.

I think you were taking wrong move. You should sell your coins when the price of the coin falling too much.
As a trader, we must sell our coins either if the price rising or falling too much in the market.
The purpose of this move is to cut our loss when the price fall, and to get our gain when the price rise.

Dollar cost averaging thing suits only either big investors or funds that have a comprehensive strategy and expose only small percentage of funds per trade.
For average small investor it does not work because he has purchased with all available money and he is trapped untill price recovers.

some alt are just disaster when you go this way with dollar cost average on them. Alternatively, i will go with Bitcoin as many has suggested ealier.

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first, we must be prepared to face losses, this is part of the risk when trading or investing. second, we must understand that not all investment strategies can be applied in all products, after all we have to be selective and really do in-depth analysis. third, we must understand that the crypto ecosystem is full of surprises, there are bulls and bears, we should not get too carried away with emotions and must focus on strategy. The strategy mentioned by op, I think is more suitable to be applied to coins that have a strong market position, such as BTC, ETH, BNB. even if there is a decline, it should be with the DCA strategy, investors will be happy because they can get more coins. the key is to be patient and understand the strategy well.