Overview

Once you've established your availability funds and precautionary savings (the latter doesn't need to be fully diversified for those who are young or with limited capital; an antifragile portfolio can suffice), performance should come from trading. Remember: investing is trading, just on a different timeframe.

The goal here isn't to become a day trader or scalper, those are separate professions. However, as a swing trader, you still need to acquire the same fundamental competencies. The difference lies in their application, not the knowledge itself. For those interested in shorter timeframes, see the HFT page.

Approaches to Market Participation

The Gambler's Approach

In crypto markets particularly, many "degens" trade without a plan using excessive leverage. While occasional big gains occur, mathematically these traders are destined to lose. You'd have better odds at a casino.

Buy and Hold

This strategy is widely promoted by traditional and crypto influencers who claim "it only goes up." While simple and less stressful due to ignoring market fluctuations, this approach rarely delivers true rewards. Markets don't offer free money, success requires effort.

Buy and hold is essentially a martingale strategy: continually adding to losing positions. Without a plan, stop losses, or profit targets, you aren't trading the market; the market is trading you.

Conviction Investing

Investing based on domain expertise and perceived fundamental value is somewhat better than blind buy-and-hold, but still insufficient. Technical analysis precedes fundamentals; as seen with Novacyt, market movements telegraphed what would happen before public awareness.

In cryptocurrency, fundamentals are largely illusory. Even in stock markets, where companies produce real value through dividends and ownership, remember that "markets can remain irrational longer than you can remain solvent." Fundamentals should only be considered when technical analysis confirms the opportunity.

Swing Trading

The optimal strategy is swing trading in its broadest sense; long-term investing with a precise plan. This approach:

• Takes advantage of market trends

• Uses specific setups to determine entry and exit points

• Relies on statistical edges rather than emotion

• Requires initial setup time but is less complex than day trading

• Reduces the likelihood of being misled by market noise at weekly timeframes

This structured approach gives you control over your investment decisions while minimizing emotional reactions to market movements.