Sell Strat / Scaling Out
The only guarantee in shitcoins is more opportunities await - even the most bullish coins can go to 0 in an instant; here I outline how to properly scale out of bags to ensure you don't roundtrip
Last updated
The only guarantee in shitcoins is more opportunities await - even the most bullish coins can go to 0 in an instant; here I outline how to properly scale out of bags to ensure you don't roundtrip
Last updated
So now we know how to find coins and how to ape them, but the last (and one of the hardest) things is learning how to scale out/sell them. The method below is my general practice for scaling out that i ALWAYS follow - there are ZERO exceptions.
No matter how bullish you are on a coin, how great the team is, how awesome the community is, how good the utility is, how many announcements/catalysts are coming, etc etc etc. that coin can nuke right to 0 in an instant for 10000x diff reasons. You need to position yourself to TRULY be happy with the profit you've taken if you blink and the coin goes to 0, and also be happy with the profit you've taken/remaining bag if it keeps running.
The goal is NOT to try to sell/full-stack on tops of charts - this is completely unrealistic and is the way to guarantee you roundtrip bags. No one can time every top perfectly and sell their whole bag there.
The ONLY sustainable way to guarantee you make it out as close to that ATH as possible, is progressive scaling out (creating an average) along the way. Not only does this guarantee you exit with as much profit as possible, but it is also the healthiest for the coin in question - also helping to maximize your returns.
Scaling out vs. full-stacking also ensures you don't sell a coin and watch it moon without you - remember: THE GOAL IS NOT TRYING TO TIME ALL TIME HIGH.
Sell initials at 2-5x returns
Sell 5-20% of the remaining bag into every pump of the coin
Sell remaining bag when the r/r of holding there doesn't make sense with how much is remaining (eg. you have .5e left on a 2m mc coin, might as well sell that shit than be undersized with huge downside)
(note: leaving a moonbag is an okay strat if you're high liquidity and don't need the eth, but I personally find most of these dust to 0 and it isn't worth it)
I have created a spreadsheet that I like to use to test different scale-out strategies to see how effective each is, and how it compares to full-stacking the ATH (which, as we established, is completely unrealistic and not really possible). Below is an example from that sheet, with a 1e entry at 1m mc, and a 1bn mc ath:
As you can see in the above example, with this risk-on scale out strategy for a coin you hope 1000x's, you could achieve ~77% the same bag by scaling out and protecting your downside as you would if you full-stacked the top. Not only that, but when you consider the slippage that would come with full stacking the top, you would likely end up with even less by doing that than you would by doing the scale-out strategy!
Here is a link to this sheet, feel free to make a copy of it and edit it as you desire to play with different scale-out strategies! This one is configured anticipating a 1000x, but you could also configure it for a 100x target by simply editing the F column values to end at 100 (or any other multiple you want to target!).
It sounds easy, but to have the discipline to follow it is actually very hard. You have to realize though that selling incrementally like this can put you at 80%+ of the total profit bagged that you would have if you held everything and somehow managed to sell at the final ATH of a coin. Selling by scaling out simply creates an average sell price as close to ATH as possible, guaranteeing you don't roundtrip coins, and also making sure you maximize the most amt. of profit possible in a sustainable way.
You will never realistically be able to time the final ATH of a coin and full stack there. Not only that, but often you will lose $ due to slippage even trying. By scaling out you get as close to ATH as possible and continue growing the trading bag.
It's important to realize, you could roundtrip 100 10x's holding and hoping for 100x, then when you FINALLY hit one 100x, you will still have only made 10% of the ETH that you would have by selling everyone of those roundtripped 10x's. Selling 100 10x's is much more profitable than roundtripping bags and eventually maybe hitting one 100x.
Holding coins fully and hoping to sell your entire bag at some arbitrary market cap you made up in your mind is a completely unrealistic and unsustainable strategy that will leave you roundtripping and poor. There are ZERO guarantees in shitcoins besides there being more opportunities - so jeet your bags consistently and smartly, and stay ready for those next opportunities.
Learning this is what separates roundtrippors from printors, hopefully these principals help place you with the latter! They certainly have for me. Remember, there are ZERO exceptions to these rules, ever.
