DCA vs Volatility: Simple lesson from the latest range

[HashRate Hero]

Hi everyone,


Looking at the graphs today , this quick market variation  is untrusted for me .



Personally , I stopped trying to trade every move. I just buy a bit regularly and don't spend too much time looking at the  details and price.


Looking for your point of veiw on this! , do you guys are depanding on market indicators when  price stays flat like this for weeks, or do you just keep the exact strategy  no matter what?

[DiMarxist]

Your question is not straight, are you talking about trading or investing. If you are concerned about investing then you don't need to disturb yourself too much about current market indicators  when trying to making your moves. Just concentrate in accumulating that is the essence of bringing in the DCA method which is to help you build a consistent Bitcoin portfolio simple due to Volatility, if you are using the right DCA strategy and following it up consistently then Volatility will not be an issue to any investor.

This is because DCA is applied to making sure that investors don't feel too much of the financial pressures which comes with someone investing, reason been that investment is demanding especially when someone is not financially that that strong when starting.

[ColdLava40]

Looking for your point of veiw on this! , do you guys are depanding on market indicators when  price stays flat like this for weeks, or do you just keep the exact strategy  no matter what?

Using DCA does not require you analyze the market, except you just want to.

It is normal to experience low volatility during the weekends because trading volumes at sometimes low, but the market is active. You don't need every move or every wave of the market.

If you see that the market is less volatile, you can still invest your capital with the DCA method or if you are a short trader, you can wait till the weekend is over and continue trading when the volatility is back.

[Natalim]

That's how DCA is done, buying coins regularly despite of its current price condition. So if you are here for bitcoin accumulation and long-term hodling through DCA, you don't have to rely on the different market situation but stick on your strategy. DCA does not mind regardless if the market is bullish or bearish, as long as you got sustainable funds, then never stop buying bitcoin.

Volatility may be an issue, that's why DCA exists. It reduces the risk, removes unnecessary emotions and helps you achieve your goal through regular DCAing, not through lump sump buying. However, investors can also perform both, buy first through lump sum and then buy through DCA gradually.

[Cryptomultiplier]

This looks like more of a trading topic to me, but that's by the way because no knowledge is ever lost.

For now it's just best to avoid micro trading and focus more on accumulating Bitcoin by DCA strategy as my best advice, because as you observed and we know, the price action is quite dull. So it's best to save your capital and keep a long focus on the next real volatility in the market.

[HashRate Hero]

 

Volatility may be an issue, that's why DCA exists. It reduces the risk, removes unnecessary emotions and helps you achieve your goal through regular DCAing, not through lump sump buying.

Hybrid idea : lump sum on major dips + regular DCA is agreed !

For  others...

It is also good  to know more about  anyone running a hybrid DCA, I'm curious when it comes to  your approach. Do you keep some cash on the side for Deep flash crashes, or do you just stick to buying on a set schedule no matter what?

[Solokan]

It seems you're currently conducting a DCA and that's what people often do: they don't look at the price when buying BTC because they're focused solely on accumulating BTC and holding it for the long term. Are you planning a long-term investment in BTC or trading? However trading doesn't seem to be a suitable method for dca

I'm currently in the same boat as you, engaging in a dca I'm currently buying BTC, and I'm definitely not looking at the price when buying because I'm planning a long-term investment. Since my goal is long-term investment in BTC I don't care whether the price is stable or not as the most important thing is buying btc and accumulating it

[shinratensei_]

Volatility may be an issue, that's why DCA exists. It reduces the risk, removes unnecessary emotions and helps you achieve your goal through regular DCAing, not through lump sump buying.

Hybrid idea : lump sum on major dips + regular DCA is agreed !

Hybrid idea is flawed, lump sum on major dips is like catching falling knives, what if the price go down even further. I think you're better off with regular DCA and increase the investment at times of consolidation at the potential bottom. Don't be too reckless buying lump sum on a dip just because it's looking interesting because there could be another dip after dip. Buy it in phase instead.

[Mhizlove]

When the market moves sideways for weeks, trying to predict every little movement can make someone take unnecessary risks, and if your strategy is regular buying and long-term accumulation, it will make sense if you stick to it instead of changing plans because of every short-term price movement. Also, the indicators can give useful info, but they aren't perfect, especially when the market does not have a clear direction.

So for me, I think this kind of market requires patience. Volatility can make someone feel like it's a must to change strategy consistently or try to time every little movement. Still, the DCA helps in removing most of the pressure that comes, and you don't have to predict the bottom before you even start accumulating Bitcoin. The most important thing is for you to understand the risks, have a plan, and always stay consistent, most especially when the market is moving sideways or unpredictable.

[Cryptmuster]

Hi everyone,


Looking at the graphs today , this quick market variation  is untrusted for me .



Personally , I stopped trying to trade every move. I just buy a bit regularly and don't spend too much time looking at the  details and price.


Looking for your point of veiw on this! , do you guys are depanding on market indicators when  price stays flat like this for weeks, or do you just keep the exact strategy  no matter what?

When it comes to buying Bitcoin for a long term hold, there's essentially only one factor that matters to me: a bear market. And when Bitcoin reaches or approaches the end of its bear market (based on previous cycles), I believe that's the best time to buy. In such cases, I don't pay much attention to local price fluctuations, I just continue buying, because I expect the price to be higher than the current one in the upcoming bull market.

[AmaGold70]

Traders tends to be more careful with market trends than long term investors. In the case of bitcoin, investors who invest using DCA does not really care about price volatility because since they are long term investors, they buy bitcoin as the Market fluctuates which means, as the price of Bitcoin goes down they buy, and even when it goes up they still buy, and they do this periodically, and on a regular basis. But because they are focussing long term, making profit is a sure result.
Bitcoin price can be unpredictable in a short term, and that is the reason why some traders fall the victim of loosing their fund. For traders, not all time are favourable for them to trade, and sometimes they they try to time the market waiting for the right time to enter, and sometimes they even stay away from the market to prevent further losses.

[Maine22K]

I think it depends on your goal. If you’re a trader, then market indicators may help you identify potential setups, although they’re not guarantees, especially when the market is moving sideways. If you’re investing for the long term, sticking to a strategy like regular accumulation may make more sense than reacting to every small price movement.
I’m still learning myself, but one thing I’ve noticed is that changing strategies every time the market becomes quiet can lead to emotional decisions. Having a plan before you invest seems more important than trying to predict every move.

[Cgrexp]

Traders tends to be more careful with market trends than long term investors. In the case of bitcoin, investors who invest using DCA does not really care about price volatility because since they are long term investors, they buy bitcoin as the Market fluctuates which means, as the price of Bitcoin goes down they buy, and even when it goes up they still buy, and they do this periodically, and on a regular basis. But because they are focussing long term, making profit is a sure result.
Bitcoin price can be unpredictable in a short term, and that is the reason why some traders fall the victim of loosing their fund. For traders, not all time are favourable for them to trade, and sometimes they they try to time the market waiting for the right time to enter, and sometimes they even stay away from the market to prevent further losses.

Most new investors are adults with common sense, especially if they have made sure they have extra money on hand, so they should be able to understand why they are investing or trading in Bitcoin. And when they are putting money in Bitcoin and what they are trying to achieve with it. Those who decide to trade need to be much more skilled, because the profit of trading depends on making the right decisions by anticipating market movements. For this reason, they need to be careful about market price changes and the right time to enter and exit the market. Investing in the DCA method reduces the impact of market fluctuations. Regular purchases create an opportunity to balance the average purchase price over time. As a result, the need for investors to choose the right time is reduced. However, the purpose of the DCA method is not to guarantee profit. Like any other investment, there is a possibility of risk. No strategy is completely risk-free, so whatever decision an investor makes should be within their capabilities.

[Byebyebtc]

Well i will assume your talking about investment, because if it was trading you would have posted it in trading discussion.

Regardless of what ever the state of the market is, as long as you have made up you mind to invest, you should do so without trying to analyse or monitor the market. Especially with the fact that you are investing with DCA there is no need analyse the market or what so ever, all you have to do is just continuous investment of a fixed amount on regular intervals, you will care less about volatility, as a matter of fact one of the reason for DCA is to eliminate emotions, timing of the market and bad habits related to bitcoin investment. So indicators, lines, oderblocks E.T.C are not needed when investing.
But continuous investment and patience is what is needed

[stadus]

There is high risk when trading in a bearish market and that makes it very inconvenient to trade. Prices are very unstable, and that anytime you could be trapped while trading in the market. Instead, make the most of buying and stick with DCA if your finances are able. That's the high advantage of DCA because you can still be buying consistently regardless of what's happening around, even if the market is deeply bearish. In fact, this is the perfect timing to accumulate more bitcoin, taking advantage of the current market condition while bitcoin price is in bargain.

Volatility is never a threat for us, but it can be a huge threat for those who are investing or trading in the market blindly.

[Stepstowealth]

do you guys are depanding on market indicators when  price stays flat like this for weeks, or do you just keep the exact strategy  no matter what?

Sticking to a strategy should mean ignoring market indicators because that is what discipline entails that is being able to hold onto a strategic plan to execute and achieve a specific goal regardless of the conditions that you go through. If you have the plan to invest in Bitcoin through dollar cost averaging and then you keep focusing on the volatility of the market through the chart you will only be preparing yourself to be discouraged from following through with the strategy that you've planned and one thing with the strategy is that the time and moment you start deciding when to invest in Bitcoin and when not to invest in Bitcoin because of how the market is looking on the charts, that will be the beginning of less consistency as you would continue to miss out on the periods that you stipulated for you to invest in bitcoin from cost averaging.

[PhilosopherKing]

If you have the opportunity, then just quit trying trying to outwit the market, and just instead ongoingly invest for a period of four years and above.Timing is very stressful and when person go on to chase every price movement, then that can lead person to over trading and also having unnecessary losses.  Nonetheless, it is even wrong for person to start changing their strategy because the market is pumping. If an investor wants to do DCa then that person is supposed to focus on strategy not minding whether the price is pumping or dumping.

It is traders that use market indicator and stares as chart all day, but investor goal is to increase the amount of their Bitcoin stash , by investing ongoingly using their discretionary income. Investor don't have to wait for bitcoin price to come down before they buy.

[abhiseshakana]

I think all depend on choice of your investmernt strategy, but if you are not active trader and choose DCA, no need to paying too much attention to technical indicator. No need to wait perfect time to buy for DCA, buy the dip, buy the top, just keep buying, becuase consistency is the key of DCA. I teach my son DCA because it is simple and no need ability to predict the market for entry or exit possibility. I tell him not to ignore market conditions completely, just fundamental factor such as macroeconomic condition, interest rate policies, regulation, level of bitcoin adoption and his initial reason for investing and his investment plan.

Sideways condition is as a test for investor's psychology not their analytical skill, sometime we do overtrading just to get satisfaction of keep doing something, feel bored and loose patience. I am not rigid but I also do not change my investment strategy and just do rebalancing risk exposure when the market changes. So the main key for DCA are consistency and risk management.

[MRY]

If you have the opportunity, then just quit trying trying to outwit the market, and just instead ongoingly invest for a period of four years and above.Timing is very stressful and when person go on to chase every price movement, then that can lead person to over trading and also having unnecessary losses.  Nonetheless, it is even wrong for person to start changing their strategy because the market is pumping. If an investor wants to do DCa then that person is supposed to focus on strategy not minding whether the price is pumping or dumping.

It is traders that use market indicator and stares as chart all day, but investor goal is to increase the amount of their Bitcoin stash , by investing ongoingly using their discretionary income. Investor don't have to wait for bitcoin price to come down before they buy.

The surest long-term solution to this is to buy Bitcoin most and every single month without worrying about peeking at any price chart, the saving habit of not caring about the market and having to constantly buy some Bitcoin will save our savings the wheezes caused by having to guess when to make a purchase or sale in the modern digital currency era.

[d5000]

do you guys are depanding on market indicators when  price stays flat like this for weeks, or do you just keep the exact strategy  no matter what?

I guess you consider the sideways market "strange". However it is perfectly explainable.

First, you have to consider that a lot of Bitcoiners are adherents of the "4 year cycle theory". They think that later that year (November / December is the "traditional bottom", even if we had one bottom in February too - 2015 - ...) will be better opportunities to buy, i.e. possibly significantly under 60k or perhaps even below 50k.

This is why you'll have probably not a lot of buying pressure actually, and every little pump is "eaten" fastly, like the one in the 67k area.

There's also the theory that summer months, particularly August and September, are bearish, because they were the most bearish months in the past (even if they sometimes were also very bullish).

In addition there are no major triggers to the upside and to the downside. No stock crash but also no bull market, Iran war is in limbo, etc.

So the market is in a "wait and see" phase, the sentiment is still on "Fear".

Indeed, DCA is the best thing you can do in such a situation, without trying to outsmart the market.