The economy faces an even bleaker outlook than the Welsh weather forecast, and few are rushing to buy risky assets. Here are some tips for overcoming unfavorable market conditions.

Option #1: Save money
There is no shame in sitting on the sidelines and saving cash or stablecoins.

When the bullish momentum returns, you will have plenty of dry powder to make large allocations. In the meantime, there are still plenty of opportunities to earn revenue across the crypto markets as long as you trust the protocol you are using.

But isn’t that market timing, which is impossible? Maybe. But this is more about spotting momentum and general market trends rather than targeting the most concentrated prices or calling reversals. The larger trends are easy to spot. However, if that is a bit risky, there is another option.

Option #2: Dollar Cost Average (DCA)
Have you ever been to a physiotherapist because of a wrist or back complaint? You were hoping for a quick and easy fix, but instead you are given a series of trivial and boring exercises to do every day for three months.

Well, dollar cost average is the investment equivalent of that. It’s not exciting or even interesting but it has a very high chance of working in your favor given a long enough time horizon. And these days, there are automated bots that do it for you, and that helps you.

Related: 5 Reasons 2023 Will Be A Tough Year For Global Markets

These first two options can be combined to create a strategy. For example, putting 50% aside in stablecoins waiting for the bullish momentum to return, and putting 50% into the market in a price-insensitive way. This tactic allows for some exposure to the market, which could help combat FOMO when the market rallies, even though your overall thesis is still bearish.

Option #3: Find assets that are outperforming
Perpetually decentralized exchanges were the darlings of the bear market. After the FTX scandal, traders flocked to decentralized options, crying, “Where can I sell?” Much has gone into protocols like GMX and ApeX, which are up about 70 and 50% this year, respectively.

There will always be assets that outperform during bear markets but finding them is labor intensive and buying during a downtrend is risky. Therefore, this strategy must be approached with caution, and it is best used by investors who have the intelligence and experience to discover a good project and apply strong risk management.

Option #4: Use derivatives
There are many strategies that use derivatives and combinations of contracts to secure profit in downtrend and sideways markets. For example, using options to create a “bear spread” that allows you to make money when an asset goes down by locking in a good selling price at a discount.

There are also near-delta neutral strategies used by advanced yield growers for the long and short term on both sides of the liquidity pool. This reduces their exposure to the volatility of the assets they hold so that they can collect pool fees while reducing their negative exposure.

The hard part is not so much implementing these strategies — there are instructions readily available online — but managing them and sizing your site. Management sizes and positions can make or break these types of trades. They can be profitable in a bear market but should be used with caution.

Option #5: Keep your head while everyone else loses theirs
Unless you’re a free climber like Alex Honnald, you wouldn’t attempt climbing any type of cliff without good safety equipment. The same goes for investing in cryptocurrencies.

What are the safety equipment? Well, an emergency fund kept in cash is a good starting point. It should cover about six months of basic living expenses and should not be used for yield, borrowing or betting.

Related: Bitcoin Will Rise in 2023 – But Be Careful What You Wish For

You should also have a sinking fund, held in similar conditions (read: high liquidity) to pay for big expenses that come up like car repairs or, say, getting stuck in expensive Singapore for a week while your visa issued is delayed. This sinking fund will give you an extra reserve of backup so that you can maintain your emergency fund and use it only for real emergencies.

Finally, recessions are tough, so remember to take care of your mental health. If you worry about your wallet or are constantly checking the price, you are making yourself less healthy and less likely to make good decisions when the time comes. So, go outside, turn off your computer and play.

Develop your life outside of your investment and trading activities. If you don’t, where are you going when you finally do?

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