I came up with these 100 % profitable degen trading strategies that you can copy and optimise for your crypto trading and investment success.
Crypto trading is arguably the fastest way to make a lot of money in a very short period of time. But it’s also the easiest way to lose money if you don’t know what you’re doing.
In theory, it looks very simple; all you have to do is “buy low and sell high”, but that’s easier said than done. The truth is, you need a lot of discipline and an effective strategy to be successful.
So, I put on my thinking cap and came up with these insane degen crypto trading and investment strategies discussed in this post.
I have been using them for the past few months, and have not recorded even a single loss so far.
In fact, it’s nearly impossible to lose money, with these degen trading strategies, except of course you choose to or you traded outside the specific rules.
These degen trading strategies cover both the crypto spot and futures market and are very similar to the position trading strategy, but with some twists.
So, without much ado, let’s dive into my favourite degen trading strategies and how to use them profitably. They’re so simple anyone can use them to start making money today.
What is the meaning of degen trading?
As used in this article, degen trading is a high-risk, high-reward crypto trading strategy that does not require any form of technical analysis, trading skill or experience to execute.
It does not need you to do extensive research or analysis to determine what crypto asset to buy, and when to buy or sell.
It’s as risky as it’s profitable. But if executed according to the rules, they’re guaranteed to turn out profitable in the long run.
1. Degen trading strategy for the spot market
This is the least risky of the 2 degen trading strategies discussed in this post.
It requires you to buy a coin or token that has recorded the biggest loss on the exchange over the past 24 hours.
Preferably, you should buy as close to the end of the trading day as possible. Most exchanges close the day at 11:59 PM (23:59) UTC time.
Yes, I understand that crypto has no opening and closing hours. But exchanges need to apply a time frame for evaluating price actions, and they use 0:00 am to 11:59 PM (23:59) UTC as their opening and closing hours respectively.
Regardless, I’d buy a 25% discount (dip0 any time of the day.
Rules of degen trading strategy for the spot market
Below are the unbreakable rules of degen trading in the crypto spot market.
- The crypto asset must be a blue chip. Check out my rolling list of blue chip coins and tokens on CoinMarketCap (CMC).
- Determine what your profit target for each trade is and never go beyond the mark. For me, it’s 5% to 10%.
- Buy the coin or token when the price drops at least 10% within the past 24 hours. My sweet range is a 10% to 25% dip.
- Set a sell order based on your profit target and go about your normal life.
- You must be willing to hold the coin or token longer if the market moves against you or if it takes a lot of time to reach your profit target.
Even if it’s a bear market, a blue chip coin that dips 10% to 25% in a single day will rebound from any further decline.
Even if it doesn’t, it’s still a good buy because it’s a coin that you’ll normally buy and hold for months or years anyway.
So, if due to a black swan event, the short to medium-term trade doesn’t work out, you don’t mind holding the asset and buying more and holding for the long term.
But if it goes as expected, you move on to the next trade. No sentiments, no greed, and no regrets if the price continues to go up after you sell.
You’re kind of taking a blind risk by buying a coin simply because it’s the biggest or among the biggest losers of the day.
At the same time, the strategy is nearly 100% loss-proof, as the coins you’ll be “blindly” trading are coins with good fundamentals and are considered blue chips.
2. Degen trading strategy for the futures market (perpetual trading)
This is the most aggressive degeneracy of your life. Brace for impact and profit.
Perpetual trading requires you to long or short a particular coin depending on if you expect the price to go up or down from a certain point.
You can amplify your gains by 1x to 100x or more using leverage if your price prediction is correct; or lose a portion or all of your capital if your prediction is wrong.
The degen trading strategy for perpetual trading requires you to long a crypto asset and hold the position until it reaches your profit target or the next bull run (whenever that is)
It’s exactly the same as degen trading for the spot market but supercharged turbo boost using leverage.
For example, my currently running trade on Vela is 20x BTC long which I intend to hold until Bitcoin reaches its last all-time high price of $69,000 before I take profit.
At $69,000 you can imagine how much profit I would’ve made (assuming I don’t get liquidated before it gets there). It’s crazy, but that’s why this is degen trading.
Rules of degen trading strategy for the spot market
- Long only, no shorts (because we’re in the early stages of a major bull run and you’re a bulltard).
- You can only long Bitcoin (BTC) or Ethereum (ETH). Long anything else at your own risk.
- Do not use more than 1% of your account size on the trade.
- You must have enough money on the side to top up your account to avoid liquidation if the market moves against you.
- Your liquidation price must be at a minimum of 25% below your entry price.
- Use whatever leverage size you want between 2x to 100x.
- You can afford to lose your original capital if a black swan event causes the price to fall faster than you can top up your account, and you get liquidated.
Your major risk factor here is liquidation and funding rate (daily cost of holding a leveraged position).
Your account gets billed the funding rate every day which reduces your capital and increases your liquidation price.
The funding rate varies on every exchange, and it changes depending on the market movement. You must watch your liquidation and keep it as far away as possible, or your account will be wiped out.
Exchanges where you can execute the degen trading strategy
These degen trading strategies can be executed on any of the major centralised cryptocurrency exchanges (CEXs)available in your jurisdiction.
You can also use them on a decentralised spot or perpetual exchanges but take note of the on-chain and other fees.
My favourite centralised exchange for executing the degen trading strategy is Binance.
And for decentralised exchanges (DEXs), I use mostly use Biswap, Vela and GMX, among others.
Managing risk in degen trading
Both degen trading strategies discussed above share the same risk. What if the price of the crypto asset keeps going down after you’ve bought it?
For the spot market, you have no problem, you can just switch to HODL mode and chill it out. Under no circumstances should you sell below your buying price.
And if you have enough money on the side, you can buy more of the coin as it goes 5%, 10%, or 15%, below your initial price.
This will reduce your average purchase price and quickly put you in profit when the market rebounds. But if you don’t have excess idle cash, you just wait it out.
However, for the futures market, you must watch your liquidation price and have enough money on the side to top up your account to avoid getting liquidated.
Except you’re willing to lose your capital if the market moves too violently. At the same time, adding more funds increases your risk.
The solution here is to use lower leverage and a smaller percentage of your account size to keep your liquidation price at somewhere around 30% to 70% below your entry price.
This will give you breathing space and enough time to summon more capital if required.
The degen trading strategy is effective on blue chip coins and requires lots of patience and discipline to execute successfully. And your ability to continue holding your position until you hit your profit target is what gives the degen trading strategy its 100% success rate.
With spot trading, I have never recorded a loss with the degen trading strategy, but with futures, I have had to cut my losses once because I violated the rules multiple times.
My liquidation price was far (BTC at $5,000) but I kept buying the dip as the price of Bitcoin dropped lower. This kept raising my liquidation price until I had to cut my losses and start afresh.
I lost a significant sum in that trade, but I didn’t let myself get liquidated and get taken out of business. Always good to have something to start all over with.