The crypto landscape in 2023 is nothing short of exhilarating. To navigate these choppy waters, intelligent investors are turning to dollar-cost averaging (DCA) in crypto. This strategy involves investing a fixed amount of money at regular intervals, regardless of the asset’s price, reducing the impact of volatility. By doing so, investors avoid the risky attempt to time the market for the perfect entry point.
After the turmoil of 2022’s bear market, the idea of re-engaging with the market has been a daunting prospect for many. There’s a well-worn piece of market wisdom that warns against trying to ‘catch a falling knife,’ which vividly captures the danger of entering a rapidly declining market – yes, it can be perilous.
This is why we don’t blindly buy any cryptocurrency through dollar cost-averaging. It’s simple, yes. Is it intelligent? We don’t think so.
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Power of Buying Low: Dollar Cost Averaging in Crypto
Historically, the most significant returns often come to those who dare to buy when the market is down. Imagine a crypto asset that has nosedived from $100 to a mere $2. If you scoop it up at $2 and it bounces back to just $50, you’ve netted a 25x return on your investment!And if it climbs back to its original high? You’re looking at a whopping 50x gain. That’s the kind of math that can turn a modest investment into a windfall.Compare that scenario to joining the party when the recovery is already halfway through, say at $50. The climb from $50 to $100 is nice—a clean double. But it’s not the jaw-dropping 50x you’d get by getting in at the bottom.Buying during a plummet requires a strong stomach and an unwavering belief in the market’s recovery.
Elevating DCA: Buying on Signal, Not on Schedule
By buying in fixed amounts at regular intervals, you naturally buy more when prices are low and less when they’re high. It’s a time-tested strategy that embodies smart trading.But let’s be real: it’s tough to commit your cash when the price ticker is a cascade of red. That’s why setting up an automated DCA through your broker to take the emotion out of the equation is such a sound move.
There’s still a better way. I want to introduce you to a twist on the standard playbook—something NetPicks calls “Intelligent Dollar Cost Averaging.” This isn’t your garden-variety DCA. It’s about buying at regular intervals, but with a keen eye on market signals. We wait for a nod from our indicators—tools that have stood the test of time—to signal a recovery in the making before we make our move.Take Bitcoin, for example. Our long-term case for it has always been higher prices:By applying Intelligent DCA, we’ve managed to sidestep the worst dips and snagged Bitcoin during recoveries at massive discounts. This method hasn’t just saved us from the deepest losses—it’s also made it easier to sleep at night, knowing we’re buying Bitcoin on sale, but also at levels that are already showing signs of recovery.
Strategic Buys: NetPicks’ Crypto Trader
Our Netpicks Crypto Trader is only available a few times a year, but the indicators provided generate your own Intelligent DCA buy points.It’s like having a crypto compass in an often foggy, zero-visibility market.Let’s talk about Solana (SOLUSD). It’s been a wild ride, but our analysis suggests big things are on the horizon for this one. And we’ve seen some promising action this year already. Check out just our buy points this year.Chainlink (LINKUSD) is in a similar boat. By buying these cryptos when they’re most beleaguered, we’ve positioned ourselves for when the tide turns. And turn it does—that’s the beauty of the crypto world.
Now, does Intelligent DCA work every single time? If the market recovers, absolutely. But there are times when patience is the name of the game, and you’ve got to stick with your accumulation strategy until the rally comes. See where we are standing on MATICUSD at the time of publishing this article:
It’s early days. It will take It’s early days. It will take minimal upside for us to start stacking the gains.And we can take advantage of short-term moves as well.
“Crypto Rockets” Strategy
That’s where our “Crypto Rockets” strategy comes into play. It’s designed for those who like the thrill of the trade, capitalizing on those 20% to 200% moves that can happen in a flash. These aren’t for the HODLers; they’re for the traders who like to move fast but can be a perfect complement to your longer-term intelligent dollar cost averaging. Here is one recent example of what is possible even when just a glimpse of the bull market returns (and we haven’t yet seen when it comes back in a big way:)Remember, crypto is a roller coaster by nature. The downturns can be brutal, but they’re also where the magic happens for savvy buyers. By using Intelligent DCA, guided by NetPicks’ Crypto Currency Trader system, you’re setting yourself up for the potential of outsized gains when the market swings back to bull territory.At the very least, incorporate some DCA investing into your strategy. We’re looking for those higher prices and the inevitable bumps along the way that present new chances to invest intelligently. With a bit of strategy and nerve, we’ll navigate these choppy waters together and be well-positioned every time the bull returns.
We’re here to provide you with knowledge and tools for you to make better crypto trading decisions. In order to do that, we decided that in the next few weeks, we are going to open up our Crypto Currency Trader system so you can get involved in what could be the next bull run of cryptocurrencies across the board.