Exploiting the ups and downs (ETH, BTC etc)

By minimalist | minimalist | 25 May 2021

Buying into dips

Over the past two weeks, the market experienced a number of dips, prompting me to start buying again. I looked at things that suffered substantially in relatively terms though seem to have good prospects in the long term, including ADA, DOT, UNI, SOL, MATIC, AAVE, IOTA, XLM, HBAR, NEO, COMP, and FIL (for the latter, I went in way too early!).

I invested small amounts. My assumption - this will be the first of multiple major dips to follow.

And I think this assumption still holds. There is the risk that the market magically recovers, and I am missing out here and there. But hey, wouldn't that be great news in itself (for those with diamond hands)?

And if further dips come around, at least I can somewhat look forward to them, as there is still some cash to invest :-)

Selling vs converting during hard times

During a crash as the one we currently experience, selling can be bad, as it crystallises potential losses. There is another option though - to convert a coin into another for which you expect a stronger recovery. This brings me to my last point.

Bitcoin vs ETH

Many here are invested in both Bitcoin and ETH, which is sensible in terms of a balanced portfolio. One has to note that ETH is more volatile though. It originally raised stronger, then crashed stronger, and possibly will raise again stronger than BTC. This difference in volatility could present an opportunity as we experience ups and downs. Last week I converted a good proportion of my BTC to ETH and ADA, despite my original intention to hold all BTC. Now I somewhat depend on future dips to buy more BTC. The move hence comes with a risk, if BTC now goes up, I would have to pay a premium (I intend to stake both ETH & ADA and not to convert them back).

On the positive side, I can now look forward to both ups and downs in the future. I am less anxious that my allocation goes down, as there is always opportunity.

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