The Recent Disappointment
I must say that I was personally hoping that the bullish action at $70K would have gone on for another month or so. It would have been the perfect exit point for my medium-term holds that I have been waiting to cash out. Unfortunately, it was not to be and I missed out on what would have probably been a great trade. Anyway, as I have mentioned multiple times, downtrends are simply perfect for building and accumulation. As mentioned in my recent post, utilizing Passive Income Mechanisms is a great way to accumulate fresh piles of Crypto without any personal expense.
Drumming The Passive Drum
This is a point that I will keep drumming because it is so vitally important. When prices drop it is difficult for even the most experienced of us to go in and purchase more. However, this is exactly what you need to do. The closer to the bottom, the better. If you have passive income rolling in, it is a lot easier to do, as no actual expense is incurred in the acquisition. You really could not ask for a better opportunity, which is why passive income is an absolute must!
When it comes to acquiring new Crypto holdings in this dip, I am modestly adding to a few layer-1 blockchains that I am quite bullish on for the future. Being able to stake these coins is an added benefit that seals the deal. Despite all the recent drama with Solana, I am slowly building up my stack. Fantom is another layer-1 that I really like for the long term. I began adding to my existing stack again at the $1.35 mark about two months ago, just before it broke out to $3.30!
I am also considering Avalanche (AVAX) at these prices, especially since I said that if it dropped, I would pick some up. These allocations are very modest and are performed every few days.
The Focus Currently
I am choosing to shift current passive income into stablecoins. I have my stablecoin allocation that I never sell, which is used as a hedge to soften downtrends and bearish market cycles. However, I also would like to have a stablecoin coin allocation that I can deploy in the event of a significant crash. Buying the absolute bottom of a gut-wrenching dump is actually the most effective strategy there is. Forget high leverage, this works well with not much risk. A dump will always get a bounce, even if it is a dead cat.
Hive Backed Dollars (HBD)
The Hive stablecoin is also an option, especially when the price loses the peg and trades conservatively under a dollar. This stablecoin also offers 12% in savings, which is the highest to my knowledge. Nexo might be higher but then again that is relative to loyalty level status, which means it is not available to everyone. Even if the market moves into a prolonged sideways trend, it is still a good idea to have stablecoins at hand. Even a sideways market will dish out the occasional bargain.
I am also keeping an eye on a few leveraged tokens that could perform relatively well in the event that the market goes higher from here. Entry points are beyond vital with these instruments. If the market does however break down, the bearish version of these tokens can also be made use of to profit from the negative price action. These are very effective instruments, provided the move is significant. A prolonged period of the trend can also compound profits significantly. I would suggest that inexperienced traders avoid these instruments, as the outcome could be quite devastating. One needs to have some experience trading with leverage and understanding the effects of the multiplication factor that is at work.
Due to compounded leveraged returns, capital allocation here can be very modest. With not much at risk, decent gains can be realized, ultimately boosting your portfolio.
So to wrap it up, my current focus is to purchase stablecoins with freshly generated passive income. I am also picking up a few layer-1 projects when the price is right. On top of that, leveraged tokens are in the picture but not yet entirely active. Trying to prepare for any market condition is always an approach that I actively endorse and make use of. Markets are in essence binary and being on the wrong side without some form of hedge can be difficult to endure.
That being said, there is a lot that can happen between these two points, which is where even more planning comes into effect. Thanks for stopping by and see you in the next one!