Disclaimer (because maybe this might need to be said?): This is not finical advice. This is just an idea I am publishing to share it (because I think it's a pretty good one), and get feedback on, to hopefully make better for the benifit of us all.
This is just an idea I am publishing, to start a discussion. The chart at this point is meaningless. It's just the price, on the 4H. The only point of the chart at this point is because you need one to publish an idea. I could post more, with my actually indicators, and analysis, at a later time, but this is simply to discuss this idea.
1) This is for an uptrend in crypto. I haven't thought through how this could work in a down trend (it probably doesn't). I don't have the ability to make money on crypto by shorting it (a big disadvantage to me, and probably a lot of other people out there.)
2) This isn't without risk. Anytime you invest in anything, there is always inherent risk.
3) You got to start out with a decent buy in. And you have to leave yourself some room to hedge (e.g. If it goes down significantly, be able to buy more, to average out your initial buy in at a reasonable price, where this can still make you money.)
3a) My Advice would be never go all in on the initial buy in (no matter what your indicators, and your analysis are telling you.) You have to leave yourself some room to hedge, in case it goes down. I might go 1/10-1/4 my account on my initial buy in. Max. But I have learned some hard lessons, so for me Risk management is #1.
4) Once you have gotten in, and have hedged your position (unless you didn't need to, and just got in at the perfect bottom) to the point where when it is going back up, you are starting to make profits, take those profits. e.g. say your initial investment is 1000, and the price has you up to 1200? Take (sell) that 200, and get your investment back down to only 1000. If it keeps going higher, sell back down to 1000.
5) Assuming this is a legit uptrend (confirmed by your indicators, and analysis), when it goes down, and you are no longer sitting at 1000, buy more to get you back there (unless the uptrend has reversed, in which case sell all, until it reverses again.)
P.S. This isn't just a theoretical concept to me. I have been thinking about this for a while, and the daily just flipped from a downtrend extending back to July 10th. I got in this morning, during the pre-NYSE open dump, at 9440 with 2000$. I have now sold back to only a position of 1000$. I have made about 200$ so far (LOL, yes, I am not a whale, I am just a poor broke, debt saddled half country half city ass solider, trying to break out of this poverty.)
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And 200$ to me, is a lot of money.
Regardless, I would love some feedback from everyone on this idea.
@overproof, It's working out beautifully in this current uptrend. I have to admit though, this idea is not completely from me. I started thinking about it after an idea Bill Charlson posted on ETH that for some reason is no longer published.
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But once we hit bottom, and reverse to an active uptrend again, this idea will be validated again. We are not there yet, been getting lower highs, and lower lows on the daily for the past 4 days. Until this down trend reverses, I am no longer using this strategy, and am now using my down trend strategy.
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This idea was obviously massively invalidated in our current down trend. And I reiterate, only works in an active uptrend. In a down trend we have to take a different approach. I don't know how to post charts in response here, but if someone elucidates that for me, I would be happy to.
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Buy at the buy signals (or me it is a modified RSI, depending on what time frame I am working with), and sell at the sell signals. Wash, and repeat. Unless we go parabolic again, in which case just hold, until it dips again.
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PPPS. This idea is also invalidated, if we reverse back down again. Just looking out for anyone interested in this idea.
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In terms of the now? We are in consolidation, so we could have a big push up, or down. I have a standing order to buy back another 1000 if we hit the .618 retrace, on this recent push up. If we don't get that, and conversely push up more? It's all gravy, I will sell back down to 1000, and wait or the real retrace to but back more. P.P.S. this concept is invalidated if we go parabolic. in which case, just hold til it's done, but we are not there currently from what I can see.