Bitcoin investment strategy, short and long term investment strategies | Algonest

Bitcoin investment strategy

It is possible to buy various buying behavior by using historical Bitcoin price data. Buying during hype periods along with “weak hands” is not the best bitcoin investment strategy.

In order to get the best return on investment strategy, it’s good to hold or buy the dip. Such a strategy has always been winning.

The beginning of the year was disastrous for Bitcoin and many investors wonder what they should do. After seeing the rallies in 2017, lots of investors don’t wish to be left behind because of the market volatility. The rest of investors patiently wait for the sharp corrections after bull runs to buy in.

To choose the best bitcoin investment strategy for you, it’s necessary to analyze historical data.

Long-term bitcoin investment strategies

Long-term investment or “hodling” means that you have to invest in one-off or regular bitcoin amounts or other preferred cryptocurrencies. You secure the investment for a long period or until another condition is met (for one year or more).

Such a Plan For Investment Strategies requires the minimum of efforts and is one of the easiest ones. It is actually based on the assumption that the bitcoin price (or the price of the other preferred cryptocurrency) will increase in real-value within a long time period. This bitcoin investment strategy is a passive one. It might seem to be simple but is still pretty wise.

Despite the simplicity, you should consider what cryptocurrencies are winners within long-term timeframes, is it time-based or value-based, what percentage would you draw out, whether you are ready to lose your investment, how are you going to invest, etc. Once you have answers to these questions, you have a complete plan.

Why choose to “hodl’?

  • You want to invest easily.
  • You have the lack of time or motivation for an active investment.
  • You are not sure in your experience or technical analysis ability.
  • You are confident that your investment choices will be long-term winners.

Short-term bitcoin investment strategies

Short-term investments strategies suppose you to invest in bitcoin or other cryptocurrencies and hold your investment for short or medium periods (from several minutes to several months). This approach requires high efforts embracing the marketplace volatility

Such a strategy allows getting profit from prices changes within the shortest or medium time periods and is absolutely opposed to long-term investment strategy.

The Pros and Cons of the short-term investments strategies

  • Might require a significant investment of time.
  • Price movements might go against your expectations, which can be stressful.
  • Requires some ability of technical analysis.
  • The chance of getting high profit very quickly.

High potential return on investment within the shortest timeframes because of the price movements is one of the best advantages of such a strategy. But remember it requires lots of time investment and a stronger stomach

When choosing a short-term investment strategy, you should think well what currencies have better short and medium-term potential; what specific criteria you will have to set for your investment, including market cap, volume, purposes, etc.; the percentage of the desired return; whether your investment is realistic enough; whether it is worth your time; what are your profits goals – daily, weekly, or monthly, etc.

You should define all this ahead of time in order to have some general guidelines to bend or break depending on different circumstances and opportunities.

When choose short-term bitcoin investment strategy?

  • You’re sure in your technical analysis skills.
  • You want to gain profits quickly.
  • You have some spare time to devote.
  • You have some significant amount of capital.

The best Bitcoin investment strategy 2018

First off, it’s only up to you to decide what’s best depending on your circumstances, goals, and motivations. Different strategies work differently for different people.

However, it would be wise to hold about 70% of your investments in passive crypto assets, which means making long-term investment and keep it as a “safe bet”. It won’t be touched whatever happens next year.

Other 30% is great to invest for short or medium time periods. In case the market is overvalued, you can take everything out and take it liquid to get the benefits from it when the market corrects.

Some more helpful tips

  • Do not invest more than you could completely lose.
  • Make notes of your goals, strategies, and plans.
  • Monitor everything.
  • Compare the active trading with the passive one.
  • It’s better to make fewer but better trades and investments.


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