If you have a hare trigger trading personality like mine, you know the feeling of itchiness in a bull market. If you're anything like me, you don't have unlimited funds and you want to make the most of good times. Here's the strategy I'm using now to do just that. Might seem obvious, but there are a few tweaks to keep the market from fucking you. Take a look.
So when the market is sideways bullish like it is now, I jump between altcoins. The purpose is not to raise the total value of my portfolio — the market will do that when it gets ready. The point is to get more total tokens.
To implement this strategy properly, you really should forget any relation of the crypto market to USD/JPY/CAD etc. Because right now the market is moving in a range, ready to go up after bitcoin and ether have their pumps. Investors are really just jumping from coin to coin, pumping this one or that one randomly. Look at Coingecko. It's a mess. XD
The strategy is simple. When you get a runner that goes up more than the market, shave off a bit of that position and put it in a lagger. So right now ANKR is up 10%. DOT is down 2.5%. I'm taking a piece of the Ankr and putting it into Dot, because I can get around 10.5% more DOT than I could before.
Both ANKR and DOT will revert to their means eventually, and then the market will take them both up. But I'll have more total coins, which means I get more of a boost.
I also "lock in" profits from ANKR without disengaging the market. When the bull is running, you want to stay grabbing the horns.
When to Jump vs. When to Tether
The biggest choice is whether to tether or jump gains. "Taking profits on the way up" doesn't always mean moving to a stablecoin. If you believe the market as a whole will move up, then jumping is the right strategy. If you think there is going to be a correction, then tether.
What to Jump To
Jumping may be obvious to you, but there are a few precautions I take to keep from falling on a knife. After all, if you're jumping to a coin that is down in a bullish market, there may be a reason.
- I only jump in the same class. So ANKR and DOT are both top 200 coins. They run in the same race. I'm not jumping to some new coin that just hit Dextools. That's a fast way to lose money. (Note: Hypercompouding into a more speculative asset is something I do, though. LIke, I buy DOT, put it in Cream, borrow against the DOT, and put that money into speculation.)
- I like distributed coins. I only jump between coins that have been fully distributed so I don't get caught in somebody's roadmap. There's nothing worse than jumping to a coin that dumps because the project just opened a yield farm that is doubling the supply of coins on the market. Ideally, I want capital appreciation/depreciation to be the only variable I have to consider.
- I only jump to stuff I like. I'm a technical trader, but not totally. I'm not jumping into the coin that's down the most just because. I have to like the product and the community, because the community is what's driving prices now, not fundamentals.
- I stay away from pumps. If a coin has already had its 300% pump, I stay away from it. There are far too many coins that haven't had their pump yet this cycle, and I want all of the good stuff, baby. This might seem like a simple thing, but you can't just look at the Coincodex ticker and assume that every -5.2% means the same thing. Zoom out to the 7-day and 30-day chart so you can see if a coin has already super pumped or not.
Finally, make sure that you're trading with the best prices so you don't get fucked on fees. When you're jumping as much as I am, you don't want to lose just because some stupid fucking swap doesn't have liquidity. Like trading my ANKR...Pancakeswap had no liquidity. 98% price change. I almost hit the button before I looked, but I saved myself.
Also: Keep in mind you don't need to see red for coin jumping to work. If ANKR is up 10% and the rest of the market is up 2%, you can still do this, because you'll still get more total coins and lock in ANKR gains if it reverts to correct to the market.