The Return of DeFi Chads (Plus The Enlightened Ape Strategy)
First of all, apologies for the lack of activities in the past few months. A few of us took a break from the screens and went out to enjoy summer.
We came back to an exciting bull market where everything was pumping, and we’re excited to start sharing daily alpha and dropping knowledge bombs again.
The exciting news is, we onboarded 2 new team members (a full time trader and a part time analyst) so we will start posting new calls and content to our channels soon. We also created a Twitter which we’ll be posting content to regularly.
As you probably know, Crypto and DeFi moves quickly and those who can quickly adapt and pivot will keep winning.
We don’t know where the market is heading next, but as of late, those of us who stayed in the market had the best results with swing trading alts and flipping NFTs. For the most part, yields are no longer as attractive as before, and aping new listings isn’t providing the outsized returns it used to.
So to start off, we’ll be sharing a new trading strategy that we’ve been seeing fantastic results with.
Yes, we’ll be sharing actual trades in our TG channel, but the idea is not just so you can copy trade us and make a quick buck, but to also share our thinking process so you can replicate the results by yourself in the long term.
Introducing EASY: The Enlightened Ape Strategy, Yo
As mentioned earlier, we teamed up with a full-time trader — let’s call him Brad — who taught us his “enlightened ape” strategy. In August, he was able to 5–6x his portfolio by making lots of small but calculated gambles into BSC tokens that we would never think of buying.
Brad ignored the layer 2 and NFT boom completely and still outperformed 95% of market participants. All on BSC - the “centralized POS chain full of rug pulls” as ETH maxis would call it.
We thought he just got lucky until he broke down his system and we saw just how powerful yet simple it was. Now with SOL and FTM taking off, we’ve applied this strategy to tokens on those chains as well.
The idea is straightforward: Buy tokens in clear trending accumulation patterns and sell parabolic breaks. It’s easier said than done because of emotions, but there are many of these trade opportunities every day! You just have to know how to spot them, which we will be sharing in our free Telegram channel.
But perhaps most important of all, Brad helped correct some biases that were holding us back. Chances are if you haven’t been consistently profitable trading, then you’re making these mistakes too. We’ll get to what these mistakes are in a future article.
First, let’s go over why the Enlightened Ape Strategy Works.
Why The Enlightened Ape Strategy (EASY) Works
Have you seen this IQ distribution curve meme before?
Believe it or not, there’s a lot of truth in this.
And if you’re reading this, chances are, you’re the middle-of-the-bell-curve-IQ guy.
See, in most of life, being average IQ is great but the problem is, middle-of-the-curve guys make the least amount of money in markets because they overthink things and can be too risk-averse.
In a way, you may be too clever for your own good.
Brainlet (left) guys will typically outperform average IQ guys in markets because they don’t overthink and just ape into things. They follow trends and ride waves. And in a bull market, following the “idiots” is not a bad strategy.
However, these guys don’t have good systems in place for profit taking and risk management, so while they may have great paper gains, they rarely actualize them.
Right side of the curve guys are quant guys who also move markets and if you’re reading this, chances are you are not one of them.
That’s why we call this the “Enlightened” Ape strategy. We’re may be aping into a lot of “dumb” stuff. Tokens you would be embarrassed to tell your girlfriend or friends you bought. They may look like vaporware or clear scams.
But we’re doing so in a more calculated and systematic way to minimize downside and maximize upside. We don’t let ourselves grow emotionally attached to any particular project that we have a hard time selling (when its weak) or buying back in (when it’s strong).
And at the end of the day, it’s a numbers game and we’ll be making lot of small bets on tokens that could potentially 10–50x.
The best part? We’re going to outperform the annoying middle-of-the-curve guys who always think their projects are the best ones and everything else is a scam.
Brad used this exact strategy to turn $100k into over $3M during that last run up, and has been refining it since.
If the 2021 bull run has taught us anything, it’s narratives and memes are stronger than “fundamentals”. (Plus at the end of the day, fundamentals ARE just narratives.)
That’s why we’re putting our biases aside and only trade tokens with solid charts. We’re going to focus mainly on the charts because they will ultimately tell the story of how strong it’s community, team, memes, etc are.
When EASY Fails
We’re not going to BS you and tell you this is a magical trading strategy that works 100% of the time. There’s going to be risk and it’s important for you to know what those are.
We’re going to have trades where we buy a local top then sell for a 20–30% loss. The idea is to cut those losers quick and add more to winners that continue to trend up.
For instance, if we buy 10 coins, we may have to sell 6 of them for a 25% loss, but we keep adding to the other 4 that go on to do 200-500%.
Also, EASY fails is when BTC trends down because everything dumps when the king is dumping.
So in those downturns, it’s probably better to simply farm with stables, or stay out of the market altogether instead of trading high risk alts. However, in a bull market, EASY will likely outperform holding majors (BTC, ETH, BNB, etc) as well as blind aping.
Do you think we’re still in a bull market? We certainly do! Until the ribbon turns red (it’s based on moving averages), there’s no reason to fear we’re in a bear yet.
We’ll be sifting through a bunch of projects on BSC, SOL, ETH and FTM for those in clear accumulation patterns so you can experience for yourself how lucrative enlightened aping can be.