DCA strategy

Question

I suck at timing the market. Everytime when it dip i wait for more dip. Its just frustrating. Soni have decided to dca based on fear and greed index. I am going to run a bot that will use binance api to convert usdt to btc. Bot will run every 5 minutes. Each time it will check the fear index. Based on the fear index it will make a decision how many units it should buy. One unit is 10 dollar. The following function will be used to decide the dca units.

function getDCAUnits(fearIndex, priceAtFerIndex, currentPrice) {
    fearIndex = fearIndex + ((((currentPrice - priceAtFerIndex) / priceAtFerIndex) * 100) * 2);
    return Math.max(0, Math.ceil((43 - fearIndex) / 5));
}


Meaning there will be no buys if the fearindex is greater than or equal to 43. I hope it will reduce the frequency of me looking at the price.

Any suggestuons to improve rhe function will he great.

Answer 1

You are still market timing.. That's not DCA and is as equally flawed as your market timing attempt was.

Buy and hold. You don't needa formula.

Answer 2

Here's my formula: if it's before 5am, I will buy BTC today. If it's after 5am, I have already bought BTC today, and I will buy more tomorrow. I buy whatever amount of BTC is available using 10 units that we will call "dollars." The amount of BTC I can buy with these units fluctuates, but right now it's like .00037 maybe.

Answer 3

This is not DCA, you are still timing the market.

Answer 4

Lol

Answer 5

I divided my budget in 90 equal shares. I kept buying starting from 19k to 15k up to 23k. I stick with 30 shares for a month rule. When it rose I bought 1 share and when it crashed I bought 3 shares. Some days I skipped. But when I buy, I bought directly with the market price without entering buy order. My rule: between 23 to 20 buy 1 share, 20 18k 2 shares, 18 to 15k 3 shares a day. If it dipped below 15k, I planned to go for all. I usually kept a total of 7 to 8 shares a week average. DCA is about buying equal amounts and timing it. It is about discipline.

Answer 6

DCA is supposed to be simple.

if (hasExcessMoney){  
   buySomeBtc();  
}

The parameters that make up whether you have excess money and your risk appetite for buying some BTC are entirely individual, but ultimately it shouldn't be a long thought process

Some people set up bots to buy regularly

Personally, I buy twice a month

On pay day and then mid way thought the month.   
I might exercise some judgement if I notice a dip, but I'm certainly never delaying buying because I'm waiting for a price move...

Working out efficiencies based against bot buying, the overall difference is utterly negligible, and the time I save by NOT having to worry about charts or managing a bot is worth money to me

Answer 7

DCA sucks.......buy some now......buy some higher tomorrow

that just stupid