Here is the best strategy I use to maximize earnings when trading any cryptocurrency, any altcoin, any coin. This is when we sell a portion of our coins on target and then wait for the price to drop and buy back even more coins at a lower price. This increases our potential earnings by the time we reach the target where we really want to sell all, since our stack of coins keeps on growing with every single target more and more.
This is what I’ve been suggesting since day one, but is not as easy for beginners as the rest of the other “Selling the Targets” strategies, because this requires work on your part. The ability to stay calm; you need to master the main strategy of “Buy, Hold & Sell on Target” before using this one. You need to be able to stay relaxed, focus your mind to be able to wait for the coin to reach the price to buy in more.
Even before we get started, if you sold on target and the price then keeps on going up, you never buy back higher, you thank for the profits and move on, unless of course you know what you are doing, in this case, you can buy back whenever you want and keep on trading as a PRO.
So let’s get started, shall we?
Selling the Targets (Part 4) – Sell the Target, Rebuy Lower
Now, there are two things to look at for in this strategy, how much you buy back in when you sell on target to rebuy lower, and when to secure profits.
Let me breakdown this strategy step by step:
- We buy in low and hold. This waiting period lasts a few days, after these few days we are always in profits, which is great. This is because my trade ideas, unless I explain otherwise, are based on coins that are at the bottom, so once we join and the price starts to move up, the bottom doesn’t concerns us for a very long time. By the time the bottom is visited again, we would have sold everything already and be laughing all the way to the crypto-bank to cash our gains. We are day trades, we trade to take gains. I choose bottomed out coins because I trade for and with beginners and this is the easiest way to stay ahead.
- Now, we know through experience that coins normally retrace when they reach a resistance level, the target. Depending on the momentum of the coin, the target can be broken and the price climb high without a retrace, that is why we only sell a portion of our coins at every single target instead of selling all right away, to protect our self and not miss out on potential future earnings. But, this is not the norm, experience tells us that the price retraces almost 80-90% of the time a target is reached, if not right away then a few hours or days after this level is reached. Knowing this gives us an advantage, and we take it, because we are smart. We are beautiful, we are strong. We humbly take all of the opportunities that the market wants to give us.
- When a target is reached, the price normally drops at least 10%, even if it is a quick drop. But, most of the time, in the fast and super active cryptocurrency market, the price drops around 15-25%. This drop can last few hours, depending on the momentum of the coin or it can last few days. This is where we take advantage of the strategy I am trying to share. Now we get started.
- You sell at your target, let’s say you sold 40% of your coins. In this example, we will say that this is 1000 coins. Now you can set a buy order that is 10-25% lower of the top price reached. This percentage is not based on the target price, but the actual price top that was reached once the target was broken. Doing this will give you a quick extra 10-25% gain on the amount of coins you sold. That’s it.
- Securing profits. There is a way to secure profits while doing this, which is very advanced and at the same time smart. Let’s say that the 40% you sold represents 1000 of any given coin, and that the price was 0.40 BTC. This same 1000 coins, when you bought then at the lower price, costed you 0.25 BTC. In this advanced example, for securing profits while maintaining, you would only rebuy 0.25 BTC at the lower price. Doing this will generate you a 0.15 BTC profits, profits that you secured and at the same time you get to buy back your coins. So basically you will only repurchase the amount of coins based on BTC value at the price that you bought. You can find out this value easily, I will explain to you a bit more.
- Let’s say you bought at 32 and you sold at 65. How to know how much your 1000 coins were worth back then and how much they are worth now? What if you are only selling 20%, too much maths… ahhhh!?!?! Wait, this is simple, I don’t do math either, it is not necessary.
- Say you are selling 200 coins. All you have to do is to type in 200 coins and set the price of 32 on the order book. This will give you the cost of the coins. Then, type this same amount of coin but change the price to 65… You got it. You will see the difference between the two prices, that’s your profit. The rest, you use to buy back lower.
This whole strategy simplified
If you are a beginner and you read through everything, you might be going a little bit crazy right now, trust me, I understand, so I am going to simplify this for you. Here is the strategy again:
- Sell a certain portion of your coins when you reach a target.
- Buy back 15% lower.
- Example: If the price of a coin reached 100. You sell and put a buy order around 85.
- That’s all.
Alan Masters here, Namaste.