DCA'ing isnt a bad strategy

[doomloop]

Conclusion. In my opinion, no matter how good our trading method is, Fundametal and Technical analysis is the key to everything. DCA will function effectively if combined with appropriate and correct analysis.

If you're using fundamental and technical analysis before you start to buy Bitcoin, it's not DCA anymore because you're looking to buy Bitcoin at the lowest or you want to make short term profit. DCA strategy is when you buy Bitcoin regularly every day(s), week(s), or month(s) regardless the price is and you're keep holding since DCA is for long term goal. If you can't do that it's fine, maybe DCA isn't for you.

Why is that not DCA if someone is doing an analysis before making a purchase? DCA is simply to buy based on an average of your capital in different price intervals, it doesn't mean that you should start buying blindly without checking the price or waiting for a lower price if you can do analysis. Someone who can do analysis can do DCA in a more effective way because they can make better predictions after the analysis and they start doing DCA at a better price.

Someone who doesn't know how to do technical or fundamental analysis should simply start buying when they see the price is relatively lower than the usual price they see in the market and even if the price drops further after they start buying, they won't have to worry since they are doing DCA and they can always buy more if price dips further.

[1714766394]

1714766394

[wallet4bitcoin]

A clever Bitcoin collector will combine the two options....

You do not simply buy on a regular basis, for the sake of buying.... you rather accumulate some Fiat savings and then buy bitcoins when the price are low. Why should you follow a DCA strategy that will force you to buy at regular intervals during high prices, when you can hoard your savings and buy at low prices.

The combined strategy will increase your profits, because you are buying bitcoins at low prices. (Also, sell bitcoins at high prices and then wait for it to dip to buy more coins) 

Saving fiat and buying on drawdowns sounds very smart, and this strategy will be available to almost everyone. But when you advise selling Bitcoin at a high price and trying to buy it at a low price, then I think this may be a very difficult task for most on this forum. Since looking for levels at which it is worth selling and buying back is a complex trader’s work that requires good knowledge of technical analysis, and can ultimately lead to an inexperienced user losing more than he can gain.

Speaking frankly, DCA'ing might sound like the best idea to either a trader or an investor but the required technicality isn't for newbies in the space and often times newbies aren't that patient to get the rudiments of the space, which advises them on how best to navigate to make more profit than loses.

If one needs to DCA at any level, then a proper knowledge of technical analysis is required to keep one away from loses. How do you tell which is the best point to buy and /or sell when you can not read it off charts.

[Inwestour]

Speaking frankly, DCA'ing might sound like the best idea to either a trader or an investor but the required technicality isn't for newbies in the space and often times newbies aren't that patient to get the rudiments of the space, which advises them on how best to navigate to make more profit than loses.

If one needs to DCA at any level, then a proper knowledge of technical analysis is required to keep one away from loses. How do you tell which is the best point to buy and /or sell when you can not read it off charts.

I’m not sure about the use of DCA for trading, perhaps only in this case if we are talking about long-term trading, but here we touch on the topic of the difference between investing and long-term trading, there are those who believe that there is no difference in this and in this case, I agree that DCA would be a good strategy for trading as well.

But for day trading there is no place to apply DCA, since this type of trading requires quick decision making, you need to quickly open and close trades, there is no time to average the entry price, because this can turn you into a long-term trader, or even worse, into a holder.

[naira]

If you want a bigger chance of making a lot of money, go for the lump sum. If you want to slowly accumulate Bitcoin with the least risk (even if it means having less Bitcoin in the end), then DCA is better. For most regular people who just want to accumulate Bitcoin, DCA is a good choice because it helps you get a decent amount of Bitcoin based on the money you have to invest.

What is your opinion?
And and which method do you prefer to be used in this present market conditions?

There are many investment methods and DCA is one of them, but all methods will be good and appropriate if they are supported by stable finances. Are you sure and do you feel in harmony with DCA in terms of its definition and function? because we have discussed this often, even thousands of times, so it is no stranger to hear it, especially from beginners who seem confident in DCA but the financial reality does not support it at all.

If you want to invest in Bitcoin, you don't need to just focus on DCA, that means adjusting it to our abilities, whether it's regulated regularly or not, doesn't matter. Because the main point is whether you can hold Bitcoin in the long term or not? If we talk about investment then that is the main thing you need to emphasize. Don't act as if you think you have DCA but just seeing a bearish market will make you worry and panic sell.

[lombok]

Conclusion. In my opinion, no matter how good our trading method is, Fundametal and Technical analysis is the key to everything. DCA will function effectively if combined with appropriate and correct analysis.

If you're using fundamental and technical analysis before you start to buy Bitcoin, it's not DCA anymore because you're looking to buy Bitcoin at the lowest or you want to make short term profit. DCA strategy is when you buy Bitcoin regularly every day(s), week(s), or month(s) regardless the price is and you're keep holding since DCA is for long term goal. If you can't do that it's fine, maybe DCA isn't for you.

Why is that not DCA if someone is doing an analysis before making a purchase? DCA is simply to buy based on an average of your capital in different price intervals, it doesn't mean that you should start buying blindly without checking the price or waiting for a lower price if you can do analysis. Someone who can do analysis can do DCA in a more effective way because they can make better predictions after the analysis and they start doing DCA at a better price.

Someone who doesn't know how to do technical or fundamental analysis should simply start buying when they see the price is relatively lower than the usual price they see in the market and even if the price drops further after they start buying, they won't have to worry since they are doing DCA and they can always buy more if price dips further.

This is what I mean. Effectiveness in entering the market when purchasing any coin as a long-term investment. In bearish times we cannot just make purchases carelessly. We can use technical analysis if the funds we use are very limited, so that we get a purchase price that is close to perfect and have a greater chance of profit if the coin price starts to rise.

In this bearish period, with the help of proper technical analysis, you can provide an overview of the right buying area at low prices because every bearish moment is a support level which is very important to pay attention to if you are a smart DCA user.

[kingvirtus09]

There are many people who use that method because they find it really effective. Even I do that as long as I make money and buy cryptocurrency, knowing if there is potential for the arrival of the bull that I know and am sure will follow the lifting of Bitcoin's price.

Back in 2015, there were still many people who didn't believe in Bitcoin. That's why when Bitcoin started a bull run in 2017, they saw that with every upcoming bitcoin halving, there was actually an increase in Bitcoin, as if it had been proven and tested.

[Ale88]

What is your opinion?
And and which method do you prefer to be used in this present market conditions?

For a normal investor, and by normal I refer to someone who doesn't have any particular financial skill (like myself ) I think the DCA strategy is one of the best things out there: you keep investing every month, you know you won't be wasting that money buying useless stuff, and if the market goes up you're happy, if it goes down you're happy anyway because you can buy more BTC investing the same amount of money. No stress, no margins, no need to check the price every 5 minutes, I like it.

[Ultegra134]

What is your opinion?
And and which method do you prefer to be used in this present market conditions?

For a normal investor, and by normal I refer to someone who doesn't have any particular financial skill (like myself ) I think the DCA strategy is one of the best things out there: you keep investing every month, you know you won't be wasting that money buying useless stuff, and if the market goes up you're happy, if it goes down you're happy anyway because you can buy more BTC investing the same amount of money. No stress, no margins, no need to check the price every 5 minutes, I like it.

It's probably the least risky strategy for a newbie; it enables you to lower your average purchase price by acquiring coins on a steady basis. Personally, I'm not buying Bitcoin myself, but I'm receiving it on a weekly basis from my signature campaign, which can also be considered a form of DCA. I'm not too bothered by market fluctuations because my average purchase price is quite low, judging how high Bitcoin has gone in the past. Even now that the market isn't performing too well, my bitcoin's value hasn't lowered too much, and every bear market is an earning opportunity, as it's more affordable to purchase larger amounts of bitcoin.

[mv1986]

People are trying to figure out the best way to invest in cryptocurrency because it can be very unpredictable. If you're an investor looking to reduce your risk, you might consider a strategy called dollar-cost averaging (DCA). However, using this strategy means you're less likely to make really big profits.

No, that strategy doesn't mean you're less likely to make really big profits. Many people say this in hindsight knowing what the price of Bitcoin was over all those early days/years. But check out this example provided by JayJuanGee:

Frequently I have brought up an example of someone who might have lump sum bought BTC in 2015, and s/he bought 20 BTC for around $6,660 (so the average price per BTC is around $333), as compared with someone who might have ended up buying more regularly and more frequently and spending $100k in order to buy 100 BTC between 2015 and 2019 with an average cost of $1k per BTC

Today.  Which one would you rather be?  The one who has 20 BTC has much greater profits 3x more profits since his cost are only around $333 per BTC as compared to the one with 100 BTC and a cost that is 3x higher per BTC.  Total portfolio value is $520k for the one with 20 BTC and $2.6 million for the one with 100 BTC.

JayJuanGee also provided a link for a DCA calculator that you can use to play around with. There is no strict rule that says DCAing will get you less compared to investing a lump sum.  It's all about timing, and timing is about luck. With a lump sum that luck can be bad, neutral or good and the scale is veeeery large from bad to good when it comes to specific timings.

Dollar-cost averaging means putting the same amount of money into an investment over time. It's nice because it makes investors feel more comfortable. By spreading out your Bitcoin purchases over time, you're either buying when it's doing well, or you're getting it at a lower price compared to your first purchase, which is a good thing.

That's correct and the only hurdle to consistent DCA purchases is to become inconsistent, to deviate from the plan for reasons. Some lose interest, some think it's not going fast enough and switch to a lump sum, some forget to do it on a regular basis or prefer to go on a short vacation for the money and skip the purchase. Some buy a new iPhone and also have no money for their DCA plan, etc.

Some people prefer to invest a large lump sum all at once because you might end up with more Bitcoin quickly. But there's also a chance you'll end up with less. To decide between these two methods, you need to think about the risk involved.

It's about preference and that preference should be in line with available resources, and the term "available" should be aligned with your financial baseline and what you have left over to spend on things that are so called investments, assets that are supposed to provide added value to your life in the future. Also, I don't really get why it is either this method or that method? Why can't someone find a sweet spot by using a lump sum and DCAing with whatever distribution the person feels comfortable with?

If you want a bigger chance of making a lot of money, go for the lump sum. If you want to slowly accumulate Bitcoin with the least risk (even if it means having less Bitcoin in the end), then DCA is better. For most regular people who just want to accumulate Bitcoin, DCA is a good choice because it helps you get a decent amount of Bitcoin based on the money you have to invest.

What is your opinion?

Worst advice I have ever read (but no worries, you are not the first to give this advice, it can be found everywhere). Second part of the last quote is correct. Accumulation through DCAing is a good choice and usually never wrong if the investor gets the portion of their income right that is truly available for investments.

And and which method do you prefer to be used in this present market conditions?

A mix of both because, why not?

[Pandji02]

What is your opinion?
And and which method do you prefer to be used in this present market conditions?

For a normal investor, and by normal I refer to someone who doesn't have any particular financial skill (like myself ) I think the DCA strategy is one of the best things out there: you keep investing every month, you know you won't be wasting that money buying useless stuff, and if the market goes up you're happy, if it goes down you're happy anyway because you can buy more BTC investing the same amount of money. No stress, no margins, no need to check the price every 5 minutes, I like it.

True. I think it's the best for the regular folks. Trading is hard and requires not only experience but something in you that not everyone has. And trying to find the best time to buy Bitcoin might take your time, nerves and sometimes you might even lose the best price because you're waiting for the better one.

[Z390]

Some people prefer to invest a large lump sum all at once because you might end up with more Bitcoin quickly. But there's also a chance you'll end up with less. To decide between these two methods, you need to think about the risk involved.

It depends on the market behavior, I would prefer to go all into Bitcoin if the price fall to 10k per BTC, that's a once in a lifetime opportunity in 2023, this move is worth the risk because it will surely recover very fast from this sweet spot as many whales around the world will want to buy at the price too.

If the dip is very high then it's a big opportunity, compared to small accumulation using the DCA strategy every month or week, right now BTC is 26k and counting but it's different from seeing BTC at 10k right now.

The lowest that Bitcoin have dipped since the beginning of this bear market was 15k to 17k and anything lower seems impossible again, the worst that could happen now is retesting the base, do you see the difference now? Some risks are worth taking because of the once in a life time opportunity they creates.

[Blitzboy]

What is your opinion?
And and which method do you prefer to be used in this present market conditions?

For a normal investor, and by normal I refer to someone who doesn't have any particular financial skill (like myself ) I think the DCA strategy is one of the best things out there: you keep investing every month, you know you won't be wasting that money buying useless stuff, and if the market goes up you're happy, if it goes down you're happy anyway because you can buy more BTC investing the same amount of money. No stress, no margins, no need to check the price every 5 minutes, I like it.

It's probably the least risky strategy for a newbie; it enables you to lower your average purchase price by acquiring coins on a steady basis. Personally, I'm not buying Bitcoin myself, but I'm receiving it on a weekly basis from my signature campaign, which can also be considered a form of DCA. I'm not too bothered by market fluctuations because my average purchase price is quite low, judging how high Bitcoin has gone in the past. Even now that the market isn't performing too well, my bitcoin's value hasn't lowered too much, and every bear market is an earning opportunity, as it's more affordable to purchase larger amounts of bitcoin.

Theres a flip side to this approach, often overlooked: opportunity cost. Sure, you're lowering your average purchase cost over time. Yet, you're also missing out on the potential for other investments that might offer quicker returns. Even within the cryptocurrency world, there are altcoins and tokens that could yield high returns. So, while you're safeguarding your investments, are you also stifling their potential?

Im not saying DCA is bad; its a proven strategy. But its prudent to reassess and consider a more diversified portfolio, especially if you've got a steady flow of Bitcoin coming in through signature campaigns. Thus, while DCA is safe, it may not always be the best strategy to optimize your returns.

[blockman]

No problem if you want a lump sum type of investing or DCA type. As long as you can afford to invest in any amount you're totally fine, there's nothing with it. The mere fact that you're thinking of a strategy for what should be your investment approach makes sense already.
Either of the two works perfectly for anybody. So, you only have to choose what's gonna work best for you.

Trading is hard and requires not only experience but something in you that not everyone has.

It requires patience and better decision-making. If you're okay to lose that, you don't need any of those but no trader wants to lose so, that's why it is a serious matter that needs to be precise when you do your trades.

And trying to find the best time to buy Bitcoin might take your time, nerves and sometimes you might even lose the best price because you're waiting for the better one.

It will take our time because we're waiting for the most decent price that we think is best and fits our thoughts for being low and best time to buy.

[LogitechMouse]

~
If you want a bigger chance of making a lot of money, go for the lump sum. If you want to slowly accumulate Bitcoin with the least risk (even if it means having less Bitcoin in the end), then DCA is better. For most regular people who just want to accumulate Bitcoin, DCA is a good choice because it helps you get a decent amount of Bitcoin based on the money you have to invest.

What is your opinion?
And and which method do you prefer to be used in this present market conditions?

Both investing at once, and DCA have pros and cons.

Not all of the people have huge money to throw immediately, and simply invest into Bitcoins that's why they are using DCA as their strategy as it requires lesser amount of money. Though I agree that doing DCA can give you lesser profits because of the fact that there might be a time where Bitcoin is going up already while you are still buying it, it's safer because if you did do lump sum, bought Bitcoin at once using all of your money, and then suddenly it went down, you will lose a lot of money, but you can earn a lot more if it goes the opposite side.

Overall, DCA is always a good strategy, and market condition don't affect that much. When we are in a bear market, you can still do it. When we are in the accumulation phase, you can still do it. When we are in the bull run, you can still do in (but it isn't advisable). If I will choose between the 2 strategies though, I prefer using DCA since it fits me, but if I have huge amounts of money, and the market conditions says that it's a good time to buy, I will definitely buy at once.

[noormcs5]

A clever Bitcoin collector will combine the two options....

You do not simply buy on a regular basis, for the sake of buying.... you rather accumulate some Fiat savings and then buy bitcoins when the price are low. Why should you follow a DCA strategy that will force you to buy at regular intervals during high prices, when you can hoard your savings and buy at low prices.

The combined strategy will increase your profits, because you are buying bitcoins at low prices. (Also, sell bitcoins at high prices and then wait for it to dip to buy more coins) 

Saving fiat and buying on drawdowns sounds very smart, and this strategy will be available to almost everyone. But when you advise selling Bitcoin at a high price and trying to buy it at a low price, then I think this may be a very difficult task for most on this forum. Since looking for levels at which it is worth selling and buying back is a complex trader’s work that requires good knowledge of technical analysis, and can ultimately lead to an inexperienced user losing more than he can gain.

Speaking frankly, DCA'ing might sound like the best idea to either a trader or an investor but the required technicality isn't for newbies in the space and often times newbies aren't that patient to get the rudiments of the space, which advises them on how best to navigate to make more profit than loses.

If one needs to DCA at any level, then a proper knowledge of technical analysis is required to keep one away from loses. How do you tell which is the best point to buy and /or sell when you can not read it off charts.

I must say that if you do not do the DCA, then either you will end up buying Bitcoin high with all your money or maybe end up not taking any position in BTC as you will keep on waiting for more low prices.

I think in a volatile currency like Bitcoin, the dollar cost average is the best way to take your entries.  There is nothing best if you know and pre-plan at which prices you will take how much entry and you need to be clear about it. This way,  on every significant price dump you will be happy to accumulate and not panic like others.

[Ultegra134]

What is your opinion?
And and which method do you prefer to be used in this present market conditions?

For a normal investor, and by normal I refer to someone who doesn't have any particular financial skill (like myself ) I think the DCA strategy is one of the best things out there: you keep investing every month, you know you won't be wasting that money buying useless stuff, and if the market goes up you're happy, if it goes down you're happy anyway because you can buy more BTC investing the same amount of money. No stress, no margins, no need to check the price every 5 minutes, I like it.

It's probably the least risky strategy for a newbie; it enables you to lower your average purchase price by acquiring coins on a steady basis. Personally, I'm not buying Bitcoin myself, but I'm receiving it on a weekly basis from my signature campaign, which can also be considered a form of DCA. I'm not too bothered by market fluctuations because my average purchase price is quite low, judging how high Bitcoin has gone in the past. Even now that the market isn't performing too well, my bitcoin's value hasn't lowered too much, and every bear market is an earning opportunity, as it's more affordable to purchase larger amounts of bitcoin.

Theres a flip side to this approach, often overlooked: opportunity cost. Sure, you're lowering your average purchase cost over time. Yet, you're also missing out on the potential for other investments that might offer quicker returns. Even within the cryptocurrency world, there are altcoins and tokens that could yield high returns. So, while you're safeguarding your investments, are you also stifling their potential?

Im not saying DCA is bad; its a proven strategy. But its prudent to reassess and consider a more diversified portfolio, especially if you've got a steady flow of Bitcoin coming in through signature campaigns. Thus, while DCA is safe, it may not always be the best strategy to optimize your returns.

That's a good point. Certainly, DCA is not a panacea; it's an all-rounder solution that is particularly newbie-friendly; it's not the best one in terms of returns, but an average risk-to-benefit solution. The negative with DCA is that it can miss opportunities that may occur in between the two purchasing dates, such as a minor crash. Generally, altcoins and tokens offer greater yields than DCA can offer; for instance, the Cyber token on Binance made me a decent sum of money within a few days. In my opinion, DCA is a great solution for both newbies and experienced users that require an all-round solution with relatively low effort and effectiveness in the long run, depending on the coin you invest.

[Ale88]

What is your opinion?
And and which method do you prefer to be used in this present market conditions?

For a normal investor, and by normal I refer to someone who doesn't have any particular financial skill (like myself ) I think the DCA strategy is one of the best things out there: you keep investing every month, you know you won't be wasting that money buying useless stuff, and if the market goes up you're happy, if it goes down you're happy anyway because you can buy more BTC investing the same amount of money. No stress, no margins, no need to check the price every 5 minutes, I like it.

It's probably the least risky strategy for a newbie; it enables you to lower your average purchase price by acquiring coins on a steady basis. Personally, I'm not buying Bitcoin myself, but I'm receiving it on a weekly basis from my signature campaign, which can also be considered a form of DCA. I'm not too bothered by market fluctuations because my average purchase price is quite low, judging how high Bitcoin has gone in the past. Even now that the market isn't performing too well, my bitcoin's value hasn't lowered too much, and every bear market is an earning opportunity, as it's more affordable to purchase larger amounts of bitcoin.

I agree that the signature can be considered a DCA strategy as well, at the end you get something every week (possibly the same amount), the only difference is that instead of buying with your money you're buying with the time you spent on the forum, but the result is the same.

Theres a flip side to this approach, often overlooked: opportunity cost. Sure, you're lowering your average purchase cost over time. Yet, you're also missing out on the potential for other investments that might offer quicker returns. Even within the cryptocurrency world, there are altcoins and tokens that could yield high returns. So, while you're safeguarding your investments, are you also stifling their potential?

Im not saying DCA is bad; its a proven strategy. But its prudent to reassess and consider a more diversified portfolio, especially if you've got a steady flow of Bitcoin coming in through signature campaigns. Thus, while DCA is safe, it may not always be the best strategy to optimize your returns.

There will always be some altcoin/token that is going to outperform bitcoin for a while, the problem is to find the right one because there are just too many. If you don't want to take too many risks (I mean losing money), just go with bitcoin and in 5 years who cares if instead of 300% you did 250%, you'll be very happy anyway. For the type of experience I've accumulated in these years I prefer a smaller return but (almost) guaranteed, no more bets for me.

[irhact]

People are trying to figure out the best way to invest in cryptocurrency because it can be very unpredictable. If you're an investor looking to reduce your risk, you might consider a strategy called dollar-cost averaging (DCA). However, using this strategy means you're less likely to make really big profits.

Many individual had decided to be using DCA strategy because it makes investing in Bitcoin very cheap as you won't have to buy Bitcoin costly but be buying it part by part based on the amount of money you have with you monthly or weekly depending on when it suits your to buy Bitcoin. DCA is a good strategy and it doesn't make you lose making profits as you said because DCA is more profitable during the bear market and that's when we're supposed to be accumulating bitcoin.

When you accumulate bitcoin in the bear market, it make it profitable when you sell during the bull market. DCA in the bear market makes you lots of profits in the bull market. DCA has been used by many investors and it has been said to be the best investment strategy.