No one is aware of how this bull market will play out. Will we repeat the sample of 2013 and 2017 ? Is that this the supercycle to finish all cycles? Are we in a bear market now? Who is aware of. However personally, I feel it’ll play out just like the previous, with a blow-off-top adopted by a protracted bearish interval.
I’ve a plan, and I am positive I am not the one one fascinated with it (assuming now we have a growth and bust cycle):
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Promote into stablecoins as close to the height as I can.
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Park these stablecoins and earn curiosity on them for round a 12 months or extra.
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Purchase again throughout the bear market, utilizing DCA.
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Have extra crypto.
I used to be mendacity awake at night time fascinated with my plan an excessive amount of as a result of there are too many variables for my small mind to maintain observe of. I’ve one easy query to reply:
How a lot bitcoin can I purchase again if I promote at <peak worth> and purchase again at <post-peak worth>?
This leads me to a complete host of variables, similar to:
– What may the height worth be?
– How a lot of a drop from mentioned peak may we see, 90% once more? Solely 50%?
– Primarily based on the drop in worth from the height, what would the precise worth be?
– How a lot of my holdings would I truly wish to begin promoting, what if I offered all, or half? What would the distinction be?
– What if I promote too early? What if I feel for instance I promote pondering $100ok BTC is the highest however the market continues to rally above $300ok? Will I nonetheless be capable of purchase again greater than I’ve offered?
– If I feel for instance BTC will attain $100ok, at which worth level do I begin to promote? How a lot of a distinction will that make?
In my view, this bull cycle is a once-in-a-lifetime alternative to considerably enhance my holdings and I don’t wish to mess it up and find yourself with lower than what I began with. That is why I made this ‘What-if’ Machine, basically to see simply how badly I’ve to misjudge the market to make a loss (by way of what I maintain).
It was driving me a bit loopy, so I made a calculator on Google Sheets to inform me what would possibly occur given all of the totally different variables. I’ve discovered it fairly helpful and it was enjoyable to construct, and I’ve tried to make it as comprehensible and user-friendly as attainable:
https://docs.google.com/spreadsheets/d/1TqXfKw9N0dzaAmEo_VKKUpmZxN-fVf_s5sSLxg9MjCI/
Be aware that I have never made it editable, please make your personal copy and have a play. That is by no means monetary recommendation, I’m not a mathematician and I’m not a dealer. I do know nothing about finance, I simply acquired a bit carried away making this and want to share my work with the neighborhood:
https://dl.dropboxusercontent.com/s/yubuhcexchm0r8a/Crypto_Market_Cycle.zip
Let me clarify what we’re and the way you should use it. The thought is that you just tweak the BLUE cells (in case you edit something apart from the blue ones, it gained’t perform correctly). The blue cells on the left are the vital ones, that’s the place you tweak your technique to see what impact it’ll have.
The calculator is split into four sections, and you’re employed from left to proper. You solely have to edit the and all the remainder is computerized. I’ve included some directions within the sheet however right here I will clarify in a bit extra depth:
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– : There’s a drop-down menu to decide on the coin you are working with. This does not change something apart from the dialogues all through the sheet, so it does not actually matter what you select, it’ll work the identical, it simply offers good readable outputs. If the coin you are working with is not listed, you may simply kind it in. I’ve simply chosen the highest 20-ish cash from coinmarketcap.
– : That is mainly the worth that you just assume the coin can and can get to, your goal peak promote worth, generally I consult with this because the ‘speculated peak’. As you may see in my sheet above, I am planning for BTC to hit $150ok at its peak, and that is the place I wish to set my highest promote order.
– : Don’t be fooled, you have no idea, I have no idea, and no one is aware of what worth BTC will truly peak at. That is your first actual unknown variable. What in case you promote your stack pondering $150ok is the highest nevertheless it simply retains going? $200ok… $300ok? This determine is what you may tweak to see simply how badly it’s a must to get it incorrect earlier than you are in peril city, and danger shopping for again lower than what you began with. You’ll be shocked simply how incorrect it’s a must to get it. 😉
– % : I do not learn about you, however I plan on promoting in increments as much as my peak promote level, DCA in is vital, simply as it’s to DCA out. It is a subject that’ll simply make it straightforward to unfold out your promote factors primarily based on the utmost speculated peak. For instance, in case your most promote (‘what if I promote as much as a worth of’) level is $100ok for simplicity, deciding on 25% right here will begin promoting at $75ok, and deciding on 50% will begin it a $50ok. Get it? If you wish to simply do it in a single promote, you may set this to 0% or alternatively simply have all of the blue cells within the ‘promote calculator’ part as Zero and solely fill the highest cell (I cowl this later).
– %: As soon as you have offered your stack into stablecoins, in case you plan on parking them in some platform to earn curiosity, you may enter the APY price of the platform right here, you will see within the BUYBACK CALCULATOR part, the curiosity earned over a interval of a most 2 years is damaged down into yearly quarters. You might wish to begin shopping for again after Three months, or chances are you’ll wish to begin shopping for again after 12 months, the calculator will assist you see what that may imply, and the way a lot roughly in stablecoins you will have at that time. I would like to emphasise the APPROXIMATELY right here. The APY calculations are primary right here. I calculate what 10% APY (for instance) would earn over a 12 months, then divide that by 12, after which multiply by 3, 6, 9, and so on. It would by no means be a really correct prediction of earnings and you must think about this entire sheet a software for a ballpark solely, that will help you sleep at night time, and is completely not monetary recommendation!
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When you plan on promoting solely in a single transaction, you may both set the aforementioned subject to 0%, or you may depart all these cells as Zero and solely enter a price for the highest one. Personally, I plan on promoting in increments and weighting extra in the direction of the highest finish of my speculated peak. This part will present you what the worth factors could be for promote orders, and the way a lot you will bag at every worth level, relying on what number of cash you promote at mentioned level.
The underside of this part will let you know the entire quantity of cash offered, what your common promote worth is and the way a lot in complete you will have in stablecoins after promoting.
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That is the place you get the majority of your reply, in broad phrases. On the high, you will see how a lot curiosity your stablecoins can have earned you every quarter (primarily based in your APY % determine) and it’ll let you know what the worth of the coin will likely be within the occasion of a 60, 70, 80, or 90% drop from its peak. Adjoining to this, you will see what number of cash you would purchase again at this worth level, primarily based on most stablecoin yield or zero stablecoin yields. The cool half about this part is it’ll flip purple if you find yourself in peril of constructing again much less coin than you began with, which is the entire level of me making this factor within the first place. Strive it out, put in a method larger determine between your two worth predictions, and see how badly it’s a must to miss the mark earlier than you make a loss. There’s a broad vary displayed on the backside of this part to point out on common how a lot you will be wanting to buy again.
) / :
This was a later addition, this lets you slim down on some parameters to see a bit extra precisely (nonetheless very very approximate, this isn’t monetary recommendation). You’ll be able to tweak right here how lengthy you will be incomes curiosity at your outlined price, and you may enter a particular worth for the coin, completely arbitrarily, and see how a lot you would purchase at that worth.
