I'm currently sitting on the sidelines waiting for BTC to make its decision. We are seeing volatility contraction in BTC, typically volatility contractions precede big price moves. I do not have an opinion as to weather it's going to go up or down, but you can probably tell from my ideas that I like to do counter-trend trades.
It can't be denied that we are currently in a downtrend and the general consensus of the market is down. However, this rings alarm bells in my mind because when everyone is on one side of the market, the turn is just around the corner.
How do we trade this? There's no options in the bitcoin world so we can't trade volatility. I'll have to think about this before i proceed...
It can't be denied that we are currently in a downtrend and the general consensus of the market is down. However, this rings alarm bells in my mind because when everyone is on one side of the market, the turn is just around the corner.
How do we trade this? There's no options in the bitcoin world so we can't trade volatility. I'll have to think about this before i proceed...
Comment:
Short is active. Set target to 7430. This is a support area.
Trade closed: target reached:
That was a nice little scalp.
I will open a stop buy(long) at 8150 and a stop sell(short) at 7690.
see picture below.
The risk will be $460 PER bitcoin. While I typically trade between 1 to 2 coins (depending on price) for every position, I will be only opening 1/4 of a bitcoin for each order. Why is that? because that lowers my max loss to around $115. The reason for the small position is because this is the first time I'm trading this spread on bitcoin.
The worst case scenario is it hits my stop buy, then reverses to my stop sell (or the other way around).