I'm not sure if HODL is a great policy but I have been in the HODL mode for a long time. I invested a lot of money in cryptocurrencies especially on Ripple expecting that it will touch the moon. After my investment it did happen. The price went twice than my investment. I was having lots of hopes so I remained in HODL mode. But unfortunately the price of ripple has reach half the value of by bought price. I'm still continuing to be in the HODL mode expecting that something good will soon happen in the future.
People are having so much of hopes on the cryptocurrencies. More than cryptocurrencies and its prices, I think people have more belief on Blockchain technology. With all this in mind, I think HODL is definitely a great policy. If the technology becomes really successful I think the early adopters like us will see a great profit. I know lots of people who have already seen a great profit by investing in cryptocurrency for the past two years. Any investment will not grow if it is just going to be there without any movement. People usually say me that we have to buy, sell and again look for right opportunity to buy and then sell. Keeping the money on just HODL mode will not help us get any profit. I don't really know if it is true or not. I still continue to be in HODL mode. The Steem that I have been earning in steemit is also powering up, I have no idea of cashing out in the near future.
In some countries there is also a challenge where people cannot buy or sell cryptocurrencies. In countries like India and China there is a ban. It is either they don't really understand the significance of cryptocurrencies yet or they are trying to be very careful before it is properly regulated. At the same time there are also several advancements and research works going on with the Blockchain technology. Big MNC companies have already started exploring how they can adopt this blockchain technology for their real time applications. Many bank companies all over the world have started to use cryptocurrencies for inter bank transactions from one country to another country. If there is going to be lots of research works in the future and new adopters, I would say HODL would be a great policy and that is what I'm hoping.
Buying and holding for a long time is a fantastic strategy if you pick what you're going to hold wisely. This is exactly the strategy that made Warren Buffet worth over $70 billion. Leave day trading or swing trading cryptocurrencies to professionals. If you trade a lot and don't have really solid TA skills and a ton of experience, you will only lose your money eventually. It's a brutal negative sum game.
Also, you should know that in most jurisdictions crypto-crypto trades are tax events, and what is worse, you can't calculate the sum of your gains and losses in a year and only pay tax on what you net. In many countries, you are obliged to pay capital gains taxes on every profitable trade but are not allowed to deduct any losses from your taxable income. No sane person does any trading under those terms. Depending on how crypto trades are taxed where you live, engaging in active trading might be tantamount to committing financial suicide.
Not necessarily. If you feel you know what the short term highs and lows the market can bring then you are able to compound gains over time. Simply buying something and holding it in any investment can be even riskier than swapping fairly regularly if you don't stay on top of the knowledge needed to trade the ups and downs of the market.
Like you stated, I will say it is as it is advisable to HODL. When people do that, it gives the market more value and when that happens. It increases the price of the coin and thats to the advantage of the people who did HODL
For institutional players or large investors, it is definitely a policy, as they put a large part of money and they usually trade higher time frame and they also try to trick it by a sense that longer they hold the yearly tax burden will be reduced, because if they play more frequent or daily then they have to pay more taxes and daily trading is also not ideological for big players, they play generally big trends and make a huge chunk of money.
But when it comes to retails traders or day traders it is not more a policy and HODL sometimes become a choice for them and sometimes they are forced to go for HODL. Day trading generally sometimes profitable and sometimes goes in loss and as long as you are profiting, it is okay and no need to HODL but when the trading goes in the opposite way you generally go for HODL.
Proper money management combined with technical & fundamental analysis of any asset class is very very important before jumping into a trade, trading should always be accompanied with adequate knowledge so that you will have less HODL and most of time time you will be hitting your take profit.
Thank you and Have a great day.