Bitcoin/cryptocurrency thread

[topcat(The most tip top)]

You are correct, I know nothing about horse racing.
I'm more than happy to admit that, unlike some others may be about other things [emoji6]
 

Which would mean that your comment that “it’s not even close to being like horse racing” was spectacularly ill informed

[gaz5]

1 minute ago, topcat(The most tip top) said:

Which would mean that your comment that “it’s not even close to being like horse racing” was spectacularly ill informed

Almost as spectacularly uninformed as the comment that it was exactly like horse racing, given both sides now appear to know nothing about the other side of their "trade"? 

[Detournement]

Gaz's complete faith in drawing lines on graphs being a predictor of future events never fails to impress me.

 

[gaz5]

16 minutes ago, Detournement said:

Gaz's complete faith in drawing lines on graphs being a predictor of future events never fails to impress me.

 

Its not faith mate, it's science.

Observe, Research, Test, Refine, Report.

In all seriousness, why are you guys all so keen, as people with clearly no interest or desire to understand the practice (which is fine), to convince someone who is and who uses it every day to successfully supplement income, that it doesn't work?

Are you really all that afraid to admit that it is possible, just possible, that on this subject I may know a little more?

 

ETA: I don't use lines on graphs to predict future events, its (a lot) more complex than that the levels I trade. More than happy to explain if you are genuinely interested. The levels I use are algorithmic (i.e. calculable by machines, who make up 90% of trading volume), not discretionary.

Edited May 12, 2022 by gaz5

[Detournement]

We go through this every time. It's an interesting social phenomenon and as is increasingly undeniable the biggest criminal fraud in history.

 

[gaz5]

6 minutes ago, Detournement said:

We go through this every time. It's an interesting social phenomenon and as is increasingly undeniable the biggest criminal fraud in history.

 

What Trading on markets?

I'm not talking about Crypto here, I'm talking about trading in general. I use the same strategies on ForEx and Equities.

I get (and accept) you don't like crypto, but take that out of the equation.

But you (and the others in this thread) who poopoo all things trading, on any market, is just bizarre to me, given none of you clearly do it.

[topcat(The most tip top)]

Almost as spectacularly uninformed as the comment that it was exactly like horse racing, given both sides now appear to know nothing about the other side of their "trade"? [emoji8]

To be fair to@virginton he didn’t say they were exactly like each other just that your approach was similar to a punter studying a form book

It turns out that, according to your description of it, your approach is more like one of the several “algorithmic horse racing systems” that are out there which promise to deliver enough wins to outweigh you losses over time.

Obviously there are going to be differences not least because horses actually exist

But there’s nothing you’ve mentioned thus far that doesn’t have at least a parallel in the world of sports betting and most of it would apply to casino betting

[Detournement]

Definitely not a scam.

[beefybake]

4 hours ago, gaz5 said:

You're not listening, so let me say this, again, very, very simply:

• I. Am. Not. Advising. You. Or. Anyone. Else. To. Trade. Or. To. Try. To. Time. The. Market. As. A. Trader
• Trading and DCA are two entirely different strategies (as I've said multiple times).
• What I am trying to convey to you is that there's an efficient way to do DCA long term positions to increase return without having to be a "Trader" and there's an inefficient way to do it (DCA every dip)
• This requires next to no TA ability and next to no time spent looking at charts

In terms of your comment re: more likely to post successes. I've already said I'm only right in my trading around 56% of the time. Because I understand this is a game of probabilities and not certainties. My job is to make it OK to be wrong. TA is a tiny fraction of what is required for that, the majority of it is boring old maths. My single most important document is my Risk Management plan, which protects my capital. That's my fundamental goal. I'm not a "Trader", I'm a "Risk Manager". The reason 56% sees me profitable over time is that my losses are fixed to a maximum of 3% of my account in any position and my wins are a minimum of 6% of my account in any position. So my 56% wins bring in twice as much (minimum) as my 44% losses. That's the maths, backtested over years of data and with rules to follow to make it consistent, not arbitrary.

But I digress and will repeat again: I AM NOT TALKING ABOUT TRADING OR SUGGESTING ANYONE SHOULD DO THAT.

It suits me because I enjoy it. I like stats and patterns and maths because I'm a boring old cnut and I enjoy spending about 40 (or more) hours a week on it (across all markets BTW, not just Crypto).

So, onto the second part of your post and the question: "I guess what I'm struggling with, what made November 2021 a trend reversal rather than a dip in an uptrend?"

The attached image is a 5 Day chart, so Macro level (not trading). Yellow line is the major trend, based on Dow Theory (Higher High, Higher Low series is an uptrend, Lower Low, Lower High series is a downtrend). Reversals are signalled by ABC movements where, in an uptrend, a new low is set below the previous low (A), a new high is set below the previous high (B) and the latest "lower Low" (A) is broken by price closure (C).

This is a sell signal as it more often than not confirms trend reversal. Its a game of probabilities.

In November, as with May, that's exactly the pattern we saw. Higher High, Lower Low, Lower High, Lower Low breaker.

That's why November wasn't a "Buy the Dip" opportunity. November was a "Sell and wait" Signal.

And I repeat, this is NOT trading. Trading is done on far smaller timescales wither far more entries and exits, not to mention I flipped short (as I only trade in the direction of the trend) for my swing positions which HODLERS don't do, they "Invest" one way.

This doesn't require any in depth or repeated technical analysis. This is a 5D chart. You can look once a week, or once a month, or whatever.

• Is it a higher high and a higher low? Yup, Uptrend, DCA in on the dip.
• Has the previous low been broken? If so dont buy the dip but hold for now and wait: patience
• Has there been a lower high and the new low been closed below? If so, dont buy the dip, sell the position and wait.

*This is a BTC chart, because we're talking BTC, but this is EXACTLY the same on any instrument. Equities, ForEx, Crypto, Commodities. Whatever. Its just market structure.

Here's the thing: "Buy the Dip", "Diamond Hands", "HODL (Hold on for dear life)" - Who do you think invented those narratives?

See in those two structure breaks in May and November? Who do you think were selling their positions there and who do you think they were selling them to? Think about it for a second. Because your first instinct is correct. If you are a large player in a market you need people to sell to when you want to close your positions, otherwise you cant get out when you see the trend change coming. Convincing retail to "Buy the dip and HODL" is like the greatest trick the devil ever played in this zero sums game. 

You're playing with words here.

You're a trader.

What you're trying to convey is that you're not a 'day trader', sitting at home with their laptop,

congratulating yourself on coming out on top, and having made £10 that day, and completely 'forgetting'

about the £xxx amount they've lost on many other days.

Professional trading is all about the management of risk.

So fair enough, that's what you're doing, but you're still a trader.

Suggest you just be honest about it, rather than trying to cover yourself in some veneer of 'sophistication'.

[gaz5]

To be fair to@virginton he didn’t say they were exactly like each other just that your approach was similar to a punter studying a form book

It turns out that, according to your description of it, your approach is more like one of the several “algorithmic horse racing systems” that are out there which promise to deliver enough wins to outweigh you losses over time.

Obviously there are going to be differences not least because horses actually exist

But there’s nothing you’ve mentioned thus far that doesn’t have at least a parallel in the world of sports betting and most of it would apply to casino betting

I think this is, again, just a lack of understanding of the market and what I mean when I say algorithmic.

I'm a Software Engineer by trade, so I know how I would write applications/code and what would be required for a trading bot (in terms of actual, codeable parameters that are non discretionary, repeatable and consistent).

In order for trading bots to function (more than 90% of the volume on every market) they need to identify and trade nased on these mathematically calculated levels, because for a piece of code, a chart doesn't exist, never mind the random trend lines and discretionary patterns that lots of retail would have you believe work on them (but don't).

Algos (Trading bots) need to operate from non discretionary, calculable and consistent levels.

So that gives me enough to look for their patterns, once I figure out how they are trading. And because they are bots, consistent application of a codebase, they do the same things over and over and over again.

Ive also spent a lot of time understanding how institutions trade against retail using these bots and the problems they have in doing so. The main one being they have too much capital to take large positions all at once so they try to hide their entries and exits in slow, sideways ranges using sometimes thousands of smaller orders. But the one thing they can't hide when they are building these positions in these ranges is the by price level volume that's required to do it.

The bots are good at building these positions slowly, the same way over and over again, but they can't hide their volume footprint.

So when I see these clear (to me) bot patterns and they occur in areas of heavy by price level volume I can calculate, the same way they do, the Point of Control of that range. That being the volume nodes that extend beyond 1 standard deviation of the overall range.

Then all I need to do is wait to see what direction they then break the price in. Spotting the accumulation is one thing, but I don't know if they are accumulating longs or shorts till they move the price in their desired direction outside of the range. This has its own fingerprint that happens over and over and over again.

Once it does move, I know where they built their large position and what direction that position was in. So all I have to do then is wait for price coming back to that area, because (again, these are algos, code based trading bots) they always do the same thing: Defend the position once so they can clear it on the next move in that direction.

So I have orders waiting on the PoC in the direction of the initial breaker, targeting the next high volume node (where they started exiting the position last time) with a really tight Stop Loss, in order to keep the R:R high.

Backtesting showed that getting stopped out but keeping target at 1:3.2 was most profitable in my moddeler. Basically I win less but over time return more. I average at 1:2 because I take partial profits at set levels to lock in the trail the stops.

So, as I say, you can look at it like horse racing if you want to. But for me, given I don't trade anything discretionary at all, there's no "form guide" or favourite or horse that could break a leg, I don't see the comparison.

It's more like betting on Rangers or Celtic to win the league, with 5 games left and one of them 6 points ahead.

My style is based entirely around knowing how code works, how to spot the repeating patterns of that code and how to tie them to institutional activity. Then applying testing and maths to that to manage the risk. The risk management may be similar to sports betting, I have no idea, I've never been in a bookies in my life.

I've spent 40 hours a week for over a year developing and testing this and I'm now trading it in 3 different markets, over multiple timeframes (including my ISA).

So as confusing as it might be for you guys to understand why I have confidence in what I do, it's because I put the time in. I've not just decided "that's mumbo jumbo" based on an article I once read saying it's like horoscopes.

[gaz5]

You're playing with words here.
You're a trader.
What you're trying to convey is that you're not a 'day trader', sitting at home with their laptop,
congratulating yourself on coming out on top, and having made £10 that day, and completely 'forgetting'
about the £xxx amount they've lost on many other days.
Professional trading is all about the management of risk.
So fair enough, that's what you're doing, but you're still a trader.
Suggest you just be honest about it, rather than trying to cover yourself in some veneer of 'sophistication'.

I have been completely honest about it, you just need to learn to read.

I am a day trader. I am also a swing trader and a long term investor.

I'm not recommending anyone else be a trader, have said that over and over again. But that doesn't also mean I don't have an understanding of how to best manage DCA macro investing.

And certainly doesn't mean I can't say "buy the dip" is bullshit, invented by institutions to provide themselves with exit liquidity.

[Detournement]

Logan is going to be in the dog house for a while. 

[54_and_counting]

Some amount of people are going to be burned big time with crypto aint they, and i highly doubt by accident

[DiegoDiego]

The only people recommending crypto are those with a vested interest in boosting its value because they've ploughed their own money into it.

That's the same of any investment. If you thought it worth recommending to others, you'd invest in it yourself.

[gaz5]

6 minutes ago, oaksoft said:

Crypto crash: Stablecoin collapse sends tokens tumbling - BBC News

99% of the value lost in almost no time at all.

From $118 to just 9 CENTS.

f**k me.

A few other cryptocurrencies showing signs of severe stress as well.

It's almost as though everyone is using the same computer algorithm at the same time and when some start selling, they all start selling and panic ensues. 

A salutory lesson for anyone gambling in cryptocurrency.

You're not investing. You are gambling. Plain and simple.

The only people recommending crypto are those with a vested interest in boosting its value because they've ploughed their own money into it.

I wouldn't trust any of these people with a bargepole.

Make good decisions folks.

 

Yes, LUNA is a clusterf*ck (and Do Kwon deserved no better for being an arsehole), but we can all pick and choose our examples.

As I've said before, I totally understand that people don't like/understand Crypto and fully accept that, but lets not pretend these sorts of things don't happen to blue chip stocks as well as some sort of "told you so".

It does your argument (as someone who agrees there's a ton of bullshit in Crypto) no favours at all.

 

[beefybake]

1 hour ago, gaz5 said:

I have been completely honest about it, you just need to learn to read.

I am a day trader. I am also a swing trader and a long term investor.

I'm not recommending anyone else be a trader, have said that over and over again. But that doesn't also mean I don't have an understanding of how to best manage DCA macro investing.

And certainly doesn't mean I can't say "buy the dip" is bullshit, invented by institutions to provide themselves with exit liquidity.

I'm not a "Trader", I'm a "Risk Manager".

Your words, make up your mind, and yes I have learned to read.

By the way, I was a software engineer too,  in a previous life.

You don't need to be a software engineer, or any other kind of engineer, 

to learn how to do trading, and put it into practice.

 

As it happens, my interest in cryptocurrencies is almost zero, similar to V'ton, but from a slightly

different viewpoint. I invest in a particular direction because I prefer to feel that in doing so, I'm contributing

to making a better world through soundly run companies that make things or provide a service.

Crypto is not a productive asset in that way, ... the only reason to own it is to sell it to someone else at a

higher price.  As in, it's socially useless.

Edited May 12, 2022 by beefybake

[DiegoDiego]

Crypto is not an investment.
It is a pure gamble.

Firstly, anything you choose to do in life is an investment, be it of time, money or energy. Occasionally I regret investing in this thread so much. Putting a fiver on a horse at Ladbrokes is also an investment.

It's not a pure gamble. Most coins have fundamental metrics you can track like total volume locked, number of transactions, number of wallets connected and so on. It's not the same as putting money on black at the roulette table.

[gaz5]

4 minutes ago, beefybake said:

I'm not a "Trader", I'm a "Risk Manager".

Your words, make up your mind, and yes I have learned to read.

By the way, I was a software engineer too,  in a previous life.

You don't need to be a software engineer, or any other kind of engineer, 

to learn how to do trading, and put it into practice.

 

As it happens, my interest in cryptocurrencies is almost zero, similar to virginton, but from a slightly

different direction. I invest in a particular direction because I prefer to feel that in doing so, I'm contributing

to making a better world through soundly run companies that make things or provide a service.

Crypto is not a productive asset in that way, ... the only reason to own it is to sell it to someone else at a

higher price.  As in, it's socially useless.

I mean, clearly that was an analogy in one of the latter posts to make my point about the style of trader I am. I'm not a Degen 100x futures gambler. I'm also pretty sure in the exact post you have partially quoted I actually explain my Day Trade outlook.

You guys all seem to be completely hung up on the "Crypto" element to this though.

I'm not a Crypto maxi. As I keep saying, I trade across multiple markets, one of which happens to be Crypto.

The issue (my issue) is the bold claim that TA and Trading is somehow bad (or pointless or random lines on a chart if you look back what I reply to) in Crypto, but it's fine in all other markets because they're "good markets", not  a "bad market" like Crypto.

I get it, people dont like Crypto. There's plenty about Crypto I dont like too. But as it seems like I am one of the very few people in this thread who actively trades on multiple markets none of you are going to convince me that conventional market logic, be that trading or macro investing, doesn't apply. Because I know, from actual practice, that it does.

I'm happy you have an ethical approach to investing and that works for you, it's all about finding your own personal sweet spot.

But personally I couldn't care less what I buy and sell as long as over time its making me money. My only goal here is to retire as early as humanly possible. That's why I trade Crypto, thats why I'm waiting on a trade on Chevron in traditionals at the moment and why I have a trade waiting to catch betting against the £ v the $ when it gets back to my level. I'm market neutral and asset neutral.

And I've never claimed you need to be a software engineer to learn how to trade or even that it helps. I've said that *my* style of trading, for pretty obvious reasons, is based on the sort of logic it turns out we'd both be using on a daily basis. You cant tell me as a fellow engineer that you don't get why I would choose to trade the way I do? I do it because it's comfortable for me with 20+ years looking at and writing non trading algorithms. You have a general "feel" for how they would work. Its something I *know*.

Thats not for everyone. Anyone who did want to trade would need to find their own style, but with work and time that could be anything.

[gaz5]

24 minutes ago, oaksoft said:

Don't insult my intelligence by posting unlabelled graphs.

And don't patronise me either.

I understand the difference between investing and gambling.

Are you drunk?

I literally circled the label in Green highlighter so you couldn't miss it. Its Netflix, which is down 76% since November.

I think you've made it abundantly clear that you don't know the difference between gambling and trading, regardless of what you think. And clearly you're now making it clear you've never even looked at a chart in your life to be making your bold claims or you'd know where the ticker was.

Edited May 12, 2022 by gaz5

[gaz5]

2 minutes ago, oaksoft said:

Good luck with your gambling bud.

Where we're going Marty, we don't need luck.

Care to comment on Netflix tanking though? Being that its not a Crypto acting like a Crypto? Or just going to gloss over that point now you realise you just didn't know where the ticker was?