Now is the time to formulate a profit taking strategy. Not when everything goes parabolic. Here are some ideas.

Anyone who has been in crypto during the past two bull markets wil tell you that one of the biggest mistakes you can make is not formulating a profit taking strategy ahead of time.

When markets go parabolic you can't make rational decisions, the hype will distort your views of what's possible. You end up never taking profits and holding through a crash, and losing all your gains. Also, if a dip happens you'll be prone to panic selling and can miss out.

Now is the time, when markets are flat or bearish, that you can make rational, calculated strategies for how you are going to react if things start to go well again.

One or more of the following strategies will guarantee that you don't miss out on at least some gains when the bull happens.

Strategy 1 – Withdrawing your original stake. Basically, you wait until a certain point – say 50% or 100% gains, then you cash out whatever fiat you originally put in. That way you don't lose any money and everything else you're playing with is house money.

Strategy 2 – Shaving off profits gradually. This is simply a formula that guarantees you will profit and continue to profit as the price rises. You sell, for example, 10% of your stack every time it goes up 20%. You never sell everything but are at least hedging something in case a crash happens.

Strategy 3 – Pick a target and stick to it. This one is often favoured by people who are using charts and fib extensions to work out prices. They will pick a point they think is a good sell target and will simply sell all or part of their holdings when it hits that point.

Strategy 4 – Goal based. E.g once I have 10k, once I have enough to pay off the mortgage, once I get a house deposit etc. Once you reach your goal you take the money and run. Don't look back.

Strategy 5 – Sell after a certain time period. For example – I hold for 5 years no matter what then sell. This is a great one if you're prone to anxiety. You can just set and forget, the money is effectively gone and you don't need to think about it for 5 years.

Whatever tactic you take, ANY strategy is better than no strategy. Make sure you have a contingency plan for both rising and falling markets.