Published
Scalping crypto cost me a thousand tiny fees and a lot of sleep. I wrote about why it doesn't work: trade often enough and fees, not skill, decide your result.
So I asked the dumb-obvious question. If fast is bad, is slow good? Not minutes — weeks. Hold a coin while it's clearly trending up, step aside when it isn't. I backtested it. The answer surprised me.
The rule (that's it)
Hold the coin while its price is above its long moving average (100 or 200 days). Below the average, you're in cash. No leverage, no shorting, no staring at charts. You might make a handful of trades a year and hold each for roughly a month or two.
Six years of data
BTC, ETH, SOL — buy-and-hold vs the trend rule:
- BTC: hold = +36%/yr, Sharpe 0.82, worst drawdown −77%. Trend (100d) = +50%/yr, Sharpe 1.19, drawdown −38%. Avg hold ~28 days.
- ETH: hold = +37%/yr, Sharpe 0.79, drawdown −79%. Trend (200d) = +48%/yr, Sharpe 0.96, drawdown −60%. Avg hold ~62 days.
- SOL: hold = +117%/yr, Sharpe 1.24, drawdown −96%. Trend (200d) = +149%/yr, Sharpe 1.48, drawdown −64%. Avg hold ~46 days.
Across all three: higher return, better risk-adjusted score, and — the part that matters when it's your money — roughly half the drawdown. A −96% hold on SOL means you watched almost everything disappear and had to hold on. The trend version cut that to −64%. Still ugly. Much more survivable.
Why slow beats fast
Two reasons. First, fees: a few trades a year is rounding-error cost, where scalping bleeds 1%+ a day. Second, crypto trends hard and long. The big moves take weeks and months — exactly the moves a patient rule captures and a scalper chops into confetti. The edge was never in reacting faster. It was in sitting still through the up-leg and getting out of the way of the down-leg.
The honest catch
Crypto is still crypto. Even the trend version ate −38% to −64% drawdowns — far worse than the same rule on stock indices (~−22%). And I picked the best moving-average length per coin in hindsight, so live results will run a little weaker. One more thing: this is long-only. Shorting crypto for the long run fights its upward drift and historically loses — the win here is being in cash during downturns, not betting against the market.
The point
If your strategy needs you glued to a screen, be suspicious. The data keeps saying the same boring thing: trade less, hold the trend, respect the drawdown, and let time do the work. Before any position, know your liquidation price and size from risk — patience doesn't help if one bad candle wipes you first.