This blog post deals with trading the crypto bullruns in the most optimal way to secure profits using the CBB Index. This strategy would have easily outperformed holding bitcoin, as we would have sold at each cycle top and reinvested everything in the bear market. I will use this plan for altcoins as well, as they are highly correlated with bitcoin, making it difficult to predict the exact top for each coin. This approach may limit maximum profits, but it helps to secure them.

This strategy is based on the ColinTalksCrypto Bitcoin Bullrun Index (CBBI). The CBBI is a Bitcoin index that utilizes advanced, real-time analysis of 9 metrics to help us understand what stage of the Bitcoin bull run and bear market cycles we are in. The confidence score indicates whether we are approaching the top/bottom of a blow-off Bitcoin cycle. The CBBI algorithm and website are 100% open source. This makes CBBI different from other Bitcoin price indexes. I would highly suggest, having a look into the CBBI yourself.

CBBI

Strategy Logic

  • Buying:
    • Begin accumulation if CBBI is below 10.
    • The accumulation period spans 30 to 150 days, typically averaging 70-80 days.
    • Divide your predetermined investment into 2% increments and invest daily when the buying condition is met.
  • Selling:
    • Sell 10% of your holdings on the 7th consecutive day that CBBI stays above 80.
    • Sell 20% on the 7th consecutive day that CBBI remains above 85, provided the selling price is at least 10% higher than your last sell.
    • Sell 30% on the 7th consecutive day that CBBI stays above 90, ensuring the selling price is at least 10% higher than your previous sell.
    • Sell the remaining 40% on the 7th consecutive day that CBBI remains above 95, with the selling price being at least 10% higher than your last sell.

Historical Performance

  • 2013:
    • Buy: DCA at $2.50 over a 1-month accumulation
    • Sell: 10% at $181, 20% at $813, 30% at $1,012, 40% at $1,048
    • Your Return: 361.4x
    • Optimal Return: 575x
  • 2017:
    • Buy: DCA at $230 over a 5-month accumulation
    • Sell: 10% at $5,666, 20% at $8,220, 30% at $10,977, 40% at $16,523
    • Your Return: 52.66x
    • Optimal Return: 98.915x
  • 2021:
    • Buy: DCA at $3,550 over a 2-month accumulation
    • Sell: 10% at $39,567, 20% at $46,567, 30% at $52,354, 40% at $59,384
    • Your Return: 14.85x
    • Optimal Return: 20.27x
  • 2025:
    • Buy: DCA at $16,500 over a 2.5-month accumulation
    • Sell: TBD
    • Your Return: TBD
    • Optimal Return: TBD