Accumulate Bitcoin Every Day - Ep 16
It is interesting to track the development of Bitcoin’s price over the last two weeks. Previously we had identified the level of $10,200 as key support. Analyzing the chart, we indeed see that the price rebounded off this support twice before breaching the resistance level of $12,000.
Once we zoom out to look at the weekly chart, we can see that there are very few resistance levels until Bitcoin reaches new all-time highs. It is important to consider that the resistances left between Bitcoin and all-time highs are mostly psychological levels. Bitcoin only trader over $13,000 for a very short period in its entire history. A major breakout is likely coming soon.
The magnitude of the upward move would be exponential. In 2017, when Bitcoin broke $13,000, it only took two weeks to reach $20,000. Most investors and traders in the business now are novices, which have never experienced price increasing parabolically as it did at the peak of the previous bull run.
Some traders see an increase of 7% in 7 days as an opportunity to take profit. In contrast, experienced traders know that these spikes could be an anticipation of something bigger brewing.
How to build a suitable strategy
A few weeks ago, we launched a rule to accumulate Bitcoin every day with a take profit to optimize the returns to maximize these opportunities. The strategy buys a set amount of Bitcoin every day and then sells part of the allocation once the price increases by 4%.
During bull markets, rules that are focused on accumulate Bitcoin every day can perform particularly well. It’s worth noticing that the strategy takes profit only on 20% of Bitcoin’s current allocation. In this way, part of the allocation benefits from the price increase, and a small portion is used to bring back funds to the quote currency (in this case, USDT) to accumulate more Bitcoin over a longer time.