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Top 5 dip management strategies and how to buy more even when you're out of fiat

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Written by   199
1 year ago

The bear market is upon us and it comes with an almost endless number of dips.

If you don't buy the dips, you will probably have to wait for a very long time to be in profit again after taking over 60% to 90% loss.

But how do you keep buying the dip when there's no more fiat to spend?

In this post, I will be sharing with you my dip management strategies and how to keep buying the dip when you're out of fiat.

My 5 dip management strategies and how to keep buying the dip even when you're out of fiat.

  • Do nothing, ignore crypto and focus on your normal life.

  • Find a way to earn more crypto during this period

  • Reallocate capital (if you know exactly what you're doing) to where you can maximise the opportunity

  • Borrow against your current crypto assets and use the funds to buy more of your favourite coins.

  • Keep buying all the way down if you have a stash of cash sitting around.

1. Do nothing and focus on your normal life

Sometimes the most profitable thing to do in a market as volatile and crazy as crypto is to do nothing.

If you have a real-life job and family, this is probably the best time to take a long break off crypto and focus on them.

Forget everything you know about crypto ad pretend you hold no crypto assets. This way, you can peacefully wait out the dip for as long as it lasts.

However, this strategy assumes you're not surviving on your crypto investments.

If you're living on crypto, then this strategy will not be workable for you.

As such you will either have to get a real-life job immediately that can pay your bills or you find a way to double down on earning more crypto.

2. Find a way to earn more crypto

If you can't avoid crypto or afford extra cash to keep buying the seemingly endless dips, then you should at least make an effort to increase your crypto earnings.

This is actually the best time to be paid in crypto as the same dollar amount will afford you more than double its previous crypto equivalent.

This way, you're indirectly buying the dip.

  • Get a job that pays you in crypto. You can become a social media intern or community manager for crypto projects, or join their team as a developer, or some other positions where you can offer value to them.

  • Get more active on your paying social media networks and content platforms like noise.cash, Torum, Steemit, Hive, Publish0x, read.cash, etc. If you like, go about spamming these platforms trying to earn a few more satoshis. You will be wasting your time as they will most likely ban or restrict your account. Rather, focus on creating original, quality and interesting content and you will be rewarded for your effort. Remember, there's nothing free and it's all about value for value.

3. Reallocate capital to better-performing projects

Remember that not every project that goes down with a bear market will be alive to witness the next bull run.

And that's why you need to begin reallocating capital from your degen shitcoins and unstable or unsustainable projects to the ones with better fundamentals and a brighter future.

You should be exiting the Shiba Inus and Safemoons of crypto. And reallocating funds to the BCH, BNB, BTC, ETH, PRE, BAT, etc of crypto.

Of course, there're thousands of other shitcoins and great projects out there to avoid or allocate funds to and hopefully, you can identify them by yourself.

Another way to play the reallocation game is to use the better performing coin to acquire more of the less performing ones in your portfolio.

For example, if BTC is gaining more value against ETH, you can acquire more ETH with your BTC.

Repeat this process for all the coins in your portfolio. The goal of this strategy is to possibly increase the amount of each coin in your portfolio.

And it should only be used among the coins you're going HODL long term regardless of the market situation.

4. Borrow against your current crypto assets and use the funds to buy more of your favourite coins.

The bear market offers a great opportunity to acquire your favourite cryptocurrencies at a discount.

Your favourite coins are going for unimaginably low prices, but you have exhausted your stash of fiat and can't buy any more dips.

Maybe it's time to borrow USDT against your crypto assets and use the funds to buy your favourite coins/tokens.

It's a perfect way to raise extra cash without actually selling your precious crypto assets.

However, this strategy must be used with caution because if the dip continues, the value of your collateral will keep falling.

And if the value of the loan you took goes above the acceptable loan-to-value ratio (LVR), your collateral will be liquidated to recover the loan amount.

To avoid liquidation, you will usually be requested to top-up your collateral to maintain an acceptable LVR or pay off the loan amount plus any interest accrued.

As such I would usually borrow between 10% to 40% of my maximum borrowing limit.

If liquidation is imminent, then you could supply the new coins you purchased back to the protocol as collateral which further increases your borrow limit.

Better still, you could also supply all or a sufficient number of your crypto portfolio to the platform as collateral to avoid liquidation or enable you to borrow more.\

As I said earlier, this strategy is not for the faint of heart and you should only use it if you know exactly what you're doing.

Otherwise, the protocol will sell your coins to recover the amount you borrowed and that's usually worse than not buying the dip.

5. Keep buying all the way down if you have enough stash of cash sitting around.

Some people have a shitton of fiat or stablecoin sitting around waiting for an opportunity such as this to buy their favourite cryptocurrencies at a massive discount.

If you're among such rich dudes, then you can keep buying a certain amount of your favourite cryptocurrencies as it goes down and down until it bottoms out.

One of the ways to do this is to buy a predetermined amount of your favourite cryptocurrency every week or every month, depending on how long you think the bear market will last.

The longer you think it would last, the longer will be your DCA (dollar-cost averaging) timeframe.

Conclusion

Dips are for buying but we don't have unlimited cash to buy the endless dips in a bear market.

That's why having a strategy that helps you acquire more crypto with or with extra cash is important to make the most of a bear market.

Because as the saying goes, you make money when you buy, not when you sell. Your profit is mostly determined by your buying price, rather than the price you sold.

As such finding having an opportunity to acquire your favourite cryptocurrencies at unbelievably low prices is a sure way to making massive profits when the next bull run comes around.

Over to you. What's your dip management strategy?

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Written by   199
1 year ago
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Comments

I just downloaded an app lock so I can't visit my crypto apps because I honestly feel like I'm bound to do something stupid soon. HAHAHAHHAHA But yeah, in dips, psychological aspects really come into play, I feel like trading in extremes dips is too much for me so I just let this storm pass by and I focus on work and earning more crypto, since you can earn a lot of crypto equivalent during the dips.

Thanks for this! I've been reading a lot of your works, it really helps a lot!!!

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1 year ago

Yeah. Putting your attention off the market is sometimes the best thing to do in situations like this.

I'm glad you find the posts useful. Thanks for reading.

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1 year ago