Bull or bear? Pros don’t care! Here’s 3 strategies every trader should know

Bull or bear? Pros don’t care! Here’s 3 strategies every trader should know

Here’s 3 strategies pro traders use to produce profits regardless of the market’s direction.

Published on October 25, 2020

Those new to investing might think that professional traders spend the majority of their time staring at screens day and night in order to analyze the markets and pick the best trades but this could not be farther away from the truth.

Having a good eye isn’t what differentiates top traders from average ones, it’s the application of tried and tested strategies that give pro traders the ability to stay net positive over long periods of time. Today we will discuss how the futures carry trade, funding rate, and use of trailing stops are used by top traders.

Each of these simple strategies do not involve proprietary trading bots or a substantial margin deposit, meaning an investor does not need a massive trading balance to generate profits.

The crypto markets are known for their whipsaw price action which involves many assets rising or falling by double to triple digits within a 1 hour to 24 hour period.

Investors are drawn to the possibility of capturing stellar returns so it might sound crazy to suggest seeking just a 2% monthly gain on cryptocurrencies.

Why would an investor engage in such a ‘low yield’ strategy? The answer is compound interest. If a trader can achieve 2% per month, their yearly gain equals 27%.

Few traders would be able to match this return consistently by trying to guess market tops and bottoms. Thus, having more reliable gains relieves one from the stress of potential losses and the almost impossible task of trying to time the market.

One great strategy called the carry trade consists of buying a cryptocurrency on traditional markets and selling its fixed-month calendar futures.

This rate can be measured by analyzing the basis indicator, a metric also referred to as the futures markets annualized premium.

This is not a permanent trade as the basis indicator oscillates depending on how bullish investors are. Usually, there is a stronger opportunity in altcoins as there is less competition for those.

Viewing the chart above, take notice of how Ether’s (ETH) basis touched the 20% annualized level in mid-August. But, there’s a catch.

The devil always lies in the details, and this is one of those cases. This trade will only work if the cryptocurrency deposited as margin is the same one being shorted via futures. Some derivatives exchanges will only let you deposit Bitcoin (BTC) or Tether (USDT) as collateral.

One important thing investors must remember is that unlike perpetual futures (inverse swaps), fixed-calendar futures contracts have a set expiry date. Hence, one needs to sell the spot position at the moment of futures contract liquidation.

Other non-directional trades include options strategies which usually involve multiple expiries and futures contracts.

One example, which is less risky is to exploit and trade the funding rate. Perpetual contracts (inverse swaps) will charge either longs or shorts, depending on the leverage imbalance. Those exchanges inform an estimate for the next funding window, usually every 8 hours.

When this rate goes up, professional traders will short futures contracts and simultaneously buy it on spot exchanges. Thus, their risk is fully hedged, collecting the funding rate and reverting the trade right afterward.

Sometimes, in the market there are not many risk averse trading strategies available. In situations like these, even professional traders might consider taking a directional risk. What sets them apart from novice traders is the use of automated trading.

Most traders know how to use stop-loss, which’s a good thing, but that’s not what creates winning opportunities. The same tool can be used to initiate trades, especially if using a trailing stop.

In the above example, this trailing stop buy (long) has an activation price of $12,900. Thus, while the market remains trading above that level, this order remains dormant.

Once Bitcoin reaches that level, it will only buy after a 0.8% bounce (callback rate). Hence, it will automatically buy as soon as Bitcoin rises $103 from its lows.

This strategy is one that is frequently used by professional traders to automate their investing process and it significantly reduces the need to check prices 24-hours a day.

Practice and master those three strategies: futures carry trade, profiting from the funding rate, and buying using trailing stops. Focus on learning non-directional trading and options strategies and free yourself from guessing market tops and bottoms.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Source: news.iobanker.com

Author: ByioBanker


Filecoin Offering: Community Alleges Token Dumping, Tron's Justin Sun Wants the US SEC to Investigate | Altcoins Bitcoin News

Filecoin Offering: Community Alleges Token Dumping, Tron’s Justin Sun Wants the US SEC to Investigate | Altcoins Bitcoin News

Filecoin Offering: Community Alleges Token Dumping, Tron's Justin Sun Wants the US SEC to Investigate

The recent Filecoin (FIL) token offering is creating controversy as some crypto community members are alleging that an unknown account has received 1.5 million tokens when only 500,000 were due for unlocking. According to reports, 800,000 tokens out of the 1.5 million of such tokens have been transferred to Huobi and other exchanges.

According to a Chinese language website, 8btc.com, an unidentified Filecoin representative insisted the decision was made to help stabilize the price in the period after listing.

The representative reportedly said:

It is to establish an independent market maker to (help) maintain a stable price in the early stage of the project, because the price may be the most unstable at this time. At the same time, these coins are not a sell-off of FIL by the Filecoin.

As part of the plan, FIL tokens were also sent to other exchanges besides Huobi. Meanwhile, the Filecoin team also explained in a blog that “the network has now entered a quiet post-launch monitoring period to ensure the network is operating smoothly.” The blog adds that the “network is stable and community members are reporting successful operations.”

Despite this plan, the Filecoin token saw its price tank a few hours after listing. It seems the envisaged stabilizing strategy failed to stop the token price from dropping. As Binance trading data shows, the token opened at $200 but this had dropped to $42 at the time of writing. It is this sharp drop from the opening price that has prompted complaints and allegations of impropriety.

Filecoin Offering: Community Alleges Token Dumping, Tron's Justin Sun Wants the US SEC to Investigate

One notable critic of the FIL offering is controversial Justin Sun who is insinuating that one Juan Benet and others at Filecoin had exit scammed. Tron tweets:

“Exit scam here? 1.5 million $FIL for 200 USD each worth 300 million USD at the high. Now (the) price is below 60 USD. 70% down. No lock-up. No announcement to the community. How much do you sell? Is this ok?”

Sun, who has faced almost similar allegations, goes on to encourage investors, especially those from the United States “to make sure Filecoin and Juan Benet are held responsible for this (dumping) under the protection of the US Securities and Exchange Commission.” Some Twitter users appeared to agree with Sun while some were quick to remind him of his own past misdeeds.

Filecoin Offering: Community Alleges Token Dumping, Tron's Justin Sun Wants the US SEC to Investigate

Still, in a later tweet, an undeterred Sun doubles down on his claims that FIL devs had disregarded the rules by dumping 1.5 million tokens.

Meanwhile, in another twist to the controversy, reports also emerged on October 16 that scammers may have forged FIL tokens.

According to the Beijing-based Chainsmap monitoring system, these tokens were created a day before the offering while their transfer to addresses had been carried out by way of airdrops. In addition, a transaction pair pool has been established in Uniswap with this token.

Launched as a decentralized storage network, the Filecoin team says the project was started to help “store humanity’s most important information.” The project raised $205 million in an initial coin offering in 2017, and while the launch date was initially planned for mid-2019. However, the mainnet launch date was pushed back until block 148,888, which is expected in mid-October 2020.

What are your views about the Filecoin dumping allegations? Tell us what you think in the comments section below.

Purchase Bitcoin without visiting a cryptocurrency exchange. Buy BTC and BCH here.

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Source: news.bitcoin.com

Author: by
Terence Zimwara


Sandwiches and Lollies

Sandwiches and Lollies

Money Man has been, as you know, watching ETH move compared to BTC and realized that we are waiting for a correction that would see ETH not fully hitting targets. This got him thinking of how, think it was Rockefeller – please correct me, said that he loves selling before others do. Leaving money on the table is not that bad an idea. Basically, what he was doing was only eating the sandwich’s filling and leaving the bread for others to squabble about. Now probably had positions so big that he had to scale in and out.

Both ETH and BTC has offered lolly trades lately. Ones where traders could ‘eat the whole thing’ (bar a couple of wicks especially on ETH). This also made me think of nagihatoum (a trader on here) who has a quote by Mark Twain / The Big Short on his status bar: “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so”.

Excuse the metaphor but insisting on eating lollies and not only the filling in the sandwich, if you go trade by trade and not scaling in, could get you into trouble. The reason for Money Man bringing this up is because he sees a bit of a trend on how people interact with his ideas thread. It has become clear that most viewers are solely focused on the one analysis and so not bother to do due diligence and look at previous ones. There are a select few who do look at previous analysis, leaving their footprints with comments on ‘old analysis’ as well. Money Man likes likes, comments and follows as much as the next guy, but that is not why he brings it up – he can clearly see what most traders are focused on – the next trade and a lolly at that. All or nothing.

Please read “On Edge” if you are not sure what he is trying to do. The related BTC post (linked below) is related to his ideas on what to do if you end up in a storm and need to steady the boat.
Think about your style of trading. There are no ‘correct answers’. Do you want to pre-empt the decisions of the market and trade within patterns; do you prefer confirmations and breakouts; etc.

Conclusion: ETH tends to end up at targets once BTC has settled and decisive actions on BTC causes fear and greed on the ETH chart. Look at previous analysis and see how ETH and BTC interact. Do not simply look at somebody else’s analysis and trade on the lines they drew – that will not develop your trading. Very important to me: Please like if you appreciate the effort, please comment to develop this further and Please follow if you think this might go somewhere that you would like to know about.

Source: bitcoinscrypto.se

Author:


Abra CEO's portfolio is 50% Bitcoin as cash is 'becoming worthless'

Abra CEO’s portfolio is 50% Bitcoin as cash is ‘becoming worthless’

October 26, 20200 Comments

The co-founder and CEO of major cryptocurrency company Abra is clearly bullish on Bitcoin (BTC).

In an Oct. 23 tweet, Bill Barhydt, CEO of peer-to-peer payments platform Abra, claimed that he has significantly increased his Bitcoin holdings a few weeks ago. According to the CEO, Bitcoin now accounts for 50% of his total investment portfolio.

Barhydt talked about his holdings on an episode of Money Talks. In an Oct. 23 YouTube live stream, Barhydt reiterated his bullish stance on Bitcoin, claiming that “Bitcoin is the single best investment opportunity in the world right now.”

The executive said that Bitcoin’s scarcity is one of the biggest reasons why the cryptocurrency is the best investment option. “As the minting of new Bitcoin approaches zero in the coming years, its value versus fiat will continue to skyrocket in my opinion,” Barhydt said.

“Cash, or government-printed money also called fiat, is actually becoming worthless, while Bitcoin’s value remains constant. There will never be less fiat printed than is now. Cash is only going to get more and more worthless.”

During the live stream, Barhydt also touched upon stablecoins like Tether (USDT) and USD Coin (USDC) as well as central bank digital currencies, or CBDCs. He argued that the issuance of global CBDCs like the digital yuan does not mean that central banks are going to stop printing money. “It’s the opposite, this actually makes it easier for them to continue their irresponsible behavior of simply printing money at will,” Barhydt said.

Barhydt is known as one of the most prominent Bitcoin bulls. In early October 2020, Barhydt claimed that he has been bullish on BTC price since 2015. Previously, Barhydt called Bitcoin a store of value comparable to gold.

The CEO’s comments follow Bitcoin hitting new highs this year. On Oct. 22, Bitcoin price recorded its new 2020 high of $13,217 in the aftermath of PayPal enabling cryptocurrency purchases. Subsequently, famous Wall Street investor and billionaire Paul Tudor Jones praised Bitcoin on CNBC’s Squawk Box morning show, stating that he likes Bitcoin “even more than I did then.” The billionaire investor also claimed that holds a “small single-digit investment” in Bitcoin.

Source: cryptobrain.net

Author: by admin


PayPal special! Crypto plans revealed, Bitcoin’s reaction, critics circle: Hodler’s Digest, Oct. 19–25

PayPal special! Crypto plans revealed, Bitcoin’s reaction, critics circle: Hodler’s Digest, Oct. 19–25

Coming every Sunday, Hodler’s Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — a week on Cointelegraph in one link.

When rumors started circulating in June that PayPal was planning to launch a crypto service, the fintech giant was tight-lipped.

But this week, PayPal was ready to show its hand, confirming that it will allow its 346 million active accounts to buy and sell cryptocurrencies.

It isn’t an exaggeration to say that this is a huge deal for the mainstream adoption of digital assets. This will introduce large numbers of everyday consumers to crypto for the first time.

Initially, PayPal will support Bitcoin, Ether, Bitcoin Cash and Litecoin. U.S. account owners are going to get this new functionality first, with “select international markets” to follow later.

No fees are going to be charged for conversions until the end of this year. However, merchants won’t be able to support crypto transactions until the first half of 2021.

Announcing the news, PayPal CEO Dan Schulman said digital currencies offer “clear advantages” when it comes to financial inclusion, payment speeds and enabling governments to distribute funds to citizens quickly.

Dan Schulman comments on plans

Unsurprisingly, PayPal’s big news served as dynamite for Bitcoin. The world’s biggest cryptocurrency smashed through $13,000 on Wednesday, gaining more than $1,000. That’s only the third time that BTC has hit this level since its record high in 2017.

All of this helps strengthen Bitcoin’s position. Even before the announcement, BTC had enjoyed a sustained period in five-figure territory after spending most of the past three months trading above $10,000.

Mati Greenspan, the founder of Quantum Economics, said the PayPal link was undeniable: “There’s no doubt in my mind that this bit of news is almost solely responsible for today’s extended gains.”

other cryptocurrencies that PayPal’s going to support also enjoyed chunky gains on Wednesday. ETH was up 8%, BCH surged 9%, and LTC rose by a whopping 15%.

And it wasn’t just the crypto industry that was going wild. In the aftermath of the news, PYPL’s share price hit a record high. Unfortunately, the uptick wasn’t enough to prevent Bitcoin’s market cap from overtaking PayPal’s on Thursday.

Inevitably, attention now turns to what PayPal’s offering will look like, whether crypto exchanges need to be worried, and the company’s plans for the future.

We’re starting to get an idea of what to expect. PayPal has partnered with Paxos to deliver the service, and it has obtained a conditional cryptocurrency license from the New York State Department of Financial Services.

On Friday, reports from Bloomberg suggested that PayPal is looking to acquire a crypto asset custody firm, adding that the fintech giant is currently in talks with BitGo, which helps investors store digital assets securely.

However, that report added: “Talks could still fall apart and PayPal could opt to buy other targets.”

Meltem Demirors, the chief security officer of the crypto asset manager CoinShares, has predicted that PayPal will seek to launch a stablecoin “in the next six to 12 months.” This would be a sting in the tail for Facebook, given how PayPal left its embattled Libra project.

Yes, there has been enthusiasm over PayPal’s plans, with the analyst Willy Woo suggesting that the service could easily treble Bitcoin’s user base. But not everyone is cracking open the champagne.

People who buy crypto on PayPal won’t be able to withdraw it to a wallet off the platform, prompting critics to say it’s another case of “not your keys, not your coins.”

SatoshiLabs, the team behind the Trezor hardware wallet, wrote: “If millions of newcomers are onboarded to Bitcoin by PayPal, there could be a very serious information gap that jeopardizes their experience and undermines key principles of cryptocurrency.”

It is also concerned about how PayPal’s clout in electronic payments “will be interpreted as expertise in crypto.”

Given how Satoshi Nakamoto’s vision was to decentralize finance and remove middlemen, some crypto purists will also be horrified at PayPal wading into the space.

But there are other practicalities to worry about — and one of them is tax. Every sale of cryptocurrency becomes a taxable event, especially if it’s sold for more than it was bought for. It’s very possible that the implications of this could be lost on crypto noobs.

Meltme Demirors on the news

Of course, there was plenty of other news in the crypto and blockchain sector this week.

The Chicago Mercantile Exchange quietly overtook BitMEX to become the world’s second-biggest futures market — buoyed by rising institutional demand. All this came as the crypto fund manager Grayscale Investments increased its assets under management by $1 billion in the space of a week.

Data from Messari showed that daily transaction volumes on the Ethereum network are twice those of Bitcoin — putting the blockchain on track to process $1 trillion this year. And in news that’ll make exasperated DeFi users breathe a sigh of relief, a ConsenSys developer predicted that the Ethereum 2.0 beacon chain genesis will happen in the next six to eight weeks.

Speaking of DeFi, the funds locked in protocols surged by $1 billion as analysts predicted we could see a bull run following on from the U.S. election. Meanwhile, the U.S. acting comptroller of the currency predicted that DeFi could render the financial services offered by banks obsolete — just like email disrupted the postal service.

Top winners and losers of the week

At the end of the week, Bitcoin is at $12,994.86, Ether at $409.13 and XRP at $0.25. The total market cap is at $395,014,912,585.

Among the biggest 100 cryptocurrencies, the top three altcoin gainers of the week are Quant (47.26%), Reserve Rights (40.41%) and Ocean Protocol (33.23%). The top three altcoin losers of the week are Crypto.com Coin (18.81%), ABBC Coin (17.74%) and HedgeTrade (16.31%).

For more info on crypto prices, make sure to read Cointelegraph’s market analysis. 

“There goes wBTC. The majority of wrapped Bitcoin is custodied by BitGo. PayPal is not a good actor in this space. Position accordingly.”

THORChain

“If millions of newcomers are onboarded to Bitcoin by PayPal, there could be a very serious information gap that jeopardizes their experience and undermines key principles of cryptocurrency.”

SatoshiLabs

“Crypto is about financial freedom. It’s modern money that anyone anywhere can truly control. While we’re excited to see a new audience gain access, a non-custodial approach limits opportunity to self-custody your crypto or transact freely.”

Peter Smith, Blockchain.com CEO

“This is definitely a bullish sign for Bitcoin and other cryptocurrencies. Crypto is all about trust, and PayPal has a very high level of trust with its users […] If the UI/UX of the service is done right, we will see millions of new users join each month.”

Alex Mashinsky, Celsius CEO 

Chamath Palihapitiya

“We are eager to work with central banks and regulators around the world to offer our support, and to meaningfully contribute to shaping the role that digital currencies will play in the future of global finance and commerce.”

Dan Schulman, PayPal CEO

Unsurprisingly, the Winklevoss twins were brimming with enthusiasm in the wake of PayPal’s announcement.

Tyler Winklevoss tweeted: “PayPal is an important bridge between the mainland and the island of crypto. The diaspora from legacy finance is happening and this is the kind of infrastructure that will help make that happen. Soon there will b a flippening and crypto will b the mainland & fiat the island.”

This week, the twins doubled down on their prediction that Bitcoin will eventually hit $500,000, telling podcast host Peter McCormack that it’s a matter of when, not if.

“I would sort of contend that $500,000 Bitcoin is actually pretty conservative and the game hasn’t even really started,” Cameron noted.

A ransomware attack targeting the government systems of Georgia’s Hall County impacted key voting infrastructure, it has been revealed.

“Critical systems” within its networks were affected, and CNN says the incident may be the first ransomware attack in the 2020 election.

Officials said the county’s voter signature database and voting precinct map were heavily impacted by the hack but stressed that the voting process for citizens is unaffected.

Brett Callow, from the cybersecurity firm Emsisoft, told Cointelegraph: “There is a very real risk that they may shake voter confidence in the integrity of the vote, especially as confidence may already be quite low.”

There’s still no sign of OKEx’s cryptocurrency withdrawals returning to normal — nine days after they were suddenly suspended.

The ongoing suspension has been puzzling to many, but the exchange’s representatives maintain that the move was solely because one of the company’s private key holders has been cooperating with a Chinese public security bureau.

OKEx CEO Jay Hao has told Cointelegraph that the company is determined to reinstate withdrawals as soon as possible, adding: “We wholeheartedly apologize for this.”

Some users are starting to warn that their patience is wearing thin, expressing frustration at the lack of transparency surrounding what’s going on.

One tweeted: “Where is your CEO Jay Hao? He has to interact and give updated info frequently. When something happens with Binance, CZ tweets every hour.”

And another wrote: “It’s a bit weird one of the biggest exchanges in the world isn’t letting us withdraw money for so long.”

The creator of the blockchain-based data storage platform Filecoin has dismissed allegations that miners of its token have gone on strike as “nonsense.”

Refuting the claims, Juan Benet claimed on Twitter: “What is happening is that miners are growing slower than before launch. This is in great part because the network is no longer subsidizing their pledge and fee costs — fees cost real money now, and miners need to match growth rate to token flow.”

It had been reported that five of the largest Filecoin miners turned off thousands of rigs to protest the blockchain’s economic model, which means that miners are required to stake FIL as collateral when producing a block. The problem is that many miners are apparently coming up short in the number of tokens needed.

Cointelegraph’s Kollen Post says that, for now, PayPal’s crypto payments are more about satisfying regulators than providing users with crypto capabilities.

Mining with home rigs is back, so Elena Perez takes a look at what those interested need to know to put together their own rig at home.

Fidelity’s report claiming Bitcoin is a non-correlated asset has sparked discussion, but as Benjamin Pirus reports, not all agree with the assessment.

Source: cryptobrain.net

Author: by admin


Bull or bear? Pros don’t care! Here’s 3 strategies every trader should know

Bull or bear? Pros don’t care! Here’s 3 strategies every trader should know

Those new to investing might think that professional traders spend the majority of their time staring at screens day and night in order to analyze the markets and pick the best trades but this could not be farther away from the truth.

Having a good eye isn’t what differentiates top traders from average ones, it’s the application of tried and tested strategies that give pro traders the ability to stay net positive over long periods of time. Today we will discuss how the futures carry trade, funding rate, and use of trailing stops are used by top traders.

Each of these simple strategies do not involve proprietary trading bots or a substantial margin deposit, meaning an investor does not need a massive trading balance to generate profits.

Source: crytonow.com


Bull or bear? Pros don’t care! Here’s 3 strategies every trader should know


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