No person 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 believe it’s going to play out much like the previous, with a blow-off-top adopted by an extended bearish interval.
I’ve a plan, and I am positive I am not the one one excited about it (assuming we’ve a growth and bust cycle):
-
Promote into stablecoins as close to the height as I can.
-
Park these stablecoins and earn curiosity on them for round a yr or extra.
-
Purchase again in the course of the bear market, utilizing DCA.
-
Have extra crypto.
I used to be mendacity awake at evening excited about my plan an excessive amount of as a result of there are too many variables for my small mind to maintain monitor of. I’ve one easy query to reply:
How a lot bitcoin can I purchase again if I promote at <peak value> and purchase again at <post-peak value>?
This leads me to an entire host of variables, akin to:
– What may the height value be?
– How a lot of a drop from mentioned peak may we see, 90% once more? Solely 50%?
– Primarily based on the drop in value from the height, what would the precise value 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 believe for instance I promote pondering $100k BTC is the highest however the market continues to rally above $300k? Will I nonetheless be capable to purchase again greater than I’ve offered?
– If I believe for instance BTC will attain $100k, at which value level do I begin to promote? How a lot of a distinction will that make?
For my part, this bull cycle is a once-in-a-lifetime alternative to considerably improve my holdings and I don’t wish to mess it up and find yourself with lower than what I began with. This is the reason I made this ‘What-if’ Machine, primarily 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 completely 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 doable:
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 under no circumstances monetary recommendation, I’m not a mathematician and I’m not a dealer. I do know nothing about finance, I simply received a bit carried away making this and want to share my work with the group:
https://dl.dropboxusercontent.com/s/yubuhcexchm0r8a/Crypto_Market_Cycle.zip
Let me clarify what we’re taking a look at and the way you should use it. The concept is that you just tweak the BLUE cells (in case you edit something apart from the blue ones, it received’t operate correctly). The blue cells on the left are the essential ones, that’s the place you tweak your technique to see what impact it should have.
The calculator is split into 4 sections, and you’re employed from left to proper. You solely have to edit the and all the remainder is automated. I’ve included some directions within the sheet however right here I am going to clarify in a bit extra depth:
) :
– : 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 would not actually matter what you select, it should work the identical, it simply offers good readable outputs. If the coin you are working with is not listed, you’ll be able to simply sort it in. I’ve simply chosen the highest 20-ish cash from coinmarketcap.
– : That is principally the worth that you just suppose the coin can and can get to, your goal peak promote value, typically I discuss with this because the ‘speculated peak’. As you’ll be able to see in my sheet above, I am planning for BTC to hit $150k 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 value BTC will truly peak at. That is your first actual unknown variable. What in case you promote your stack pondering $150k is the highest however it simply retains going? $200k… $300k? This determine is what you’ll be able to tweak to see simply how badly it’s important to get it fallacious earlier than you are at risk city, and danger shopping for again lower than what you began with. You’ll be shocked simply how fallacious it’s important 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 essential, simply as it’s to DCA out. This can be a subject that’ll simply make it simple to unfold out your promote factors based mostly on the utmost speculated peak. For instance, in case your most promote (‘what if I promote as much as a value of’) level is $100k for simplicity, deciding on 25% right here will begin promoting at $75k, and deciding on 50% will begin it a $50k. Get it? If you wish to simply do it in a single promote, you’ll be able to set this to 0% or alternatively simply have all of the blue cells within the ‘promote calculator’ part as 0 and solely fill the highest cell (I cowl this later).
– %: As soon as you’ve got offered your stack into stablecoins, in case you plan on parking them in some platform to earn curiosity, you’ll be able to enter the APY charge of the platform right here, you may see within the BUYBACK CALCULATOR part, the curiosity earned over a interval of a most 2 years is damaged down into yearly quarters. It’s possible you’ll wish to begin shopping for again after 3 months, or it’s possible you’ll wish to begin shopping for again after 12 months, the calculator will make it easier to see what that can imply, and the way a lot roughly in stablecoins you may have at that time. I want to emphasise the APPROXIMATELY right here. The APY calculations are fundamental right here. I calculate what 10% APY (for instance) would earn over a yr, then divide that by 12, after which multiply by 3, 6, 9, and so forth. It would under no circumstances be a really correct prediction of earnings and it’s best to take into account this complete sheet a software for a ballpark solely, that can assist you sleep at evening, and is totally not monetary recommendation!
) :
In case you plan on promoting solely in a single transaction, you’ll be able to both set the aforementioned subject to 0%, or you’ll be able to go away all these cells as 0 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 may bag at every value level, relying on what number of cash you promote at mentioned level.
The underside of this part will inform you the full quantity of cash offered, what your common promote value is and the way a lot in whole you may have in stablecoins after promoting.
) :
That is the place you get the majority of your reply, in broad phrases. On the prime, you may see how a lot curiosity your stablecoins may have earned you every quarter (based mostly in your APY % determine) and it’ll inform you what the worth of the coin shall be within the occasion of a 60, 70, 80, or 90% drop from its peak. Adjoining to this, you may see what number of cash you can purchase again at this value level, based mostly on most stablecoin yield or zero stablecoin yields. The cool half about this part is it should flip purple when you find yourself at risk 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 value predictions, and see how badly it’s important to miss the mark earlier than you make a loss. There’s a broad vary displayed on the backside of this part to indicate on common how a lot you may be wanting to buy again.
) / :
This was a later addition, this lets you slender 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 may be incomes curiosity at your outlined charge, and you may enter a selected value for the coin, completely arbitrarily, and see how a lot you can purchase at that value.
