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Alt Season Stratagem to Increase Returns!
Alt Season Bull Market Stratagem
A quick stratagem on how I identify which coins to move into/hold/trade alts in a possible bull market.
Disclaimer: This is not financial advice, simply a journal others can gain insight from.
I classify my Altcoins into 4 tiers.
Large Caps, Mid Caps, Small Caps, and Micro/Caps. For each pair there are certain guidelines I follow when trading.
Large Caps: These are primarily your top 25 coins, close or over 1 Billion in Marketcap.
Mid Caps: These range from 400-800m.
Small Caps: 100-300m.
Micro Caps: 100m or lower, your low illiquid gems, speculative plays, 100x opportunities.
The Large Cap coins is where I move profits over to, keeping them on standby, ready to to dive into the next opportunity. Coins like Ethereum, Bitcoin, XLM, XMR, or any of your favorites from the top 25.
Medium Cap coins are where I store most of my swing trade or option trading profits. These are coins that will do very well long term and have much stronger gains compared to the top 25 coins. For example on my end, Komodo, Elf, PPT, Steem, AE, GVT. I rate these based on price action, price growth, and other variables.
Small Caps are a bit different, these are coins you have to accumulate for weeks, sometimes even months. Research should indicate a hype cycle, strong use case potential. I base these off the roadmap, team, partnerships and more. For example, VEE. I have used their app, and checked out their developer portal. Another one would be AGI or SingularityNet. Same possible hype cycle, with a strong team and sophia the robot. I can see plenty of profit by accumulating a % of my capital and holding until I see my target for returns.
Micro Caps: These are your micro caps, coins that needacoin or notsofast would tell you about on twitter. Mining, Proof of stake, and your low illiquid order books make for some fun plays. The one coin I do own that fits this category is ECA/Electra which was recently listed on Cryptopia.
These are coins which are a combination of all different types of market capitalization. The XVG and TRX for example. Coins you can dip into and out of quickly. They are usually very liquid, have decent volume, and can make you profit based on a style of pure price action. A coin like BAT which pulled over 40% today was in a super strong uptrend for weeks on the daily timeframes. This identifier can be any coin that has upcoming news/ strong price action, or simply make you a profit.
If you dedicate a portion of your portfolio to coins you really like, you can easily turn your emotions off when trading coins with your trading capital. I ignore mostly all fundamentals for this section, and focus solely on the price action as it reveals all. Most of my trades in this area have been identifying coins days before news came out without ever researching into the fundamentals. This gives you true freedom in your trading. Of course all these swing trades in this section have a predefined risk, profit targets, stoploss, etc.
Now that you are able to classify coins you want to hold, position trade, swing trade, or invest in you can begin the cycle. This part requires trading. Selling the tops of your favorite coins. For example I recently sold some of my PPT after a 60% gain and moved it into Stratis. PPT is classified as a long term position trade, so I will end up rebuying the dip. Stratis depending on the trend will most likely turn into a swing trade.
You simply move a % into any of the coin identifiers I mentioned above. After each swing trade, I always leave a % behind as I move into the next trade. This continues until I own way too many coins. When this happens I will purge all coins that are lagging behind, changing trends, and gather my troops(capital) for the next opportunity. I am liable to do that anytime I feel the tides turning, or need to reanalyze my positions. I never hold onto a bag(loser) unless I plan for it to possibly become one ahead of time. This means a calculated hype cycle, investment, etc.
If you have any questions my dms are always open on twitter.
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