Nothing really needs to be said about that image above. This is half analysis, half education.
We are in a no trade zone currently. I would definitely not recommend shorting bitcoin at this moment. There are still a ton of leveraged shorts and I just can't be with the heard like that. Wouldn't recommend any one else be right now. $6,000 has beaten YoungShkreli. I will not be trying to short anymore until there is a move up.
Everything I said before about the bear market being almost over is even more true today. This is just not normal market behavior, you cannot safely bet on downside right now. You cannot be trading in this environment at all right now.
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Everyone needs to be using a stop loss. I would further recommend that you have multiple accounts on multiple exchanges, but you absolutely must use a stop loss in a market that is unregulated like bitcoin. You will get destroyed sooner or later. Playing this game without a stop loss is the same as Russian roulette. It's gambling. It's adding unnecessary risk. That is called gambling. That is not the same as speculation. Speculation transfers risk. Gambling creates it. Don't gamble.
Stop losses are essential in trading, I agree. But this is one of the worst examples of recommending a stop loss in my opinion. The exact intention of this quick squeeze (as can be seen in the chart) was to trigger the stop losses and was set up by some wales in an unregulated market.
The only lucky case would have been, when your stop loss was set at 6k (under the squeeze) otherwise you would have got screwed by this move.
CantorTechnologies
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@eminenceheld, Imagine you went short with leverage at the bottom. Doesn't matter if they are trying to hit your stops or not. You would have avoided serious losses either way.
CantorTechnologies
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@youngshkreli, I think it's actually one of the best examples because there was no reason to see it coming, so they would have felt more comfy without the sl, but would have gotten eaten. I see what you are saying though. Consider my points, however.
HD1184K
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The pump was caused by a whale opening shorts at 6100 so the pump was to liquidate him and take over his short position.
CantorTechnologies
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@Xzhi, All I know is that I wouldn't be trading in this environment haha
panconpalta
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@Xzhi, the pump was caused because the majority thinks 6100 was a good buy, not sell
HD1184K
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@panconpalta, I will believe you need more experience before making comments like this. Either way what you say may be true, but the pump was to liquidate the shorter.
panconpalta
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@Xzhi, well maybe they should stop shorting and let this market breathe
HD1184K
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@panconpalta, Most traders don't short the top. Also, Bitcoin will be near 3500 so shorting is the better way to go versus longing.
panconpalta
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@Xzhi, I'm sorry but you are a fortune teller, not a trader
The only lucky case would have been, when your stop loss was set at 6k (under the squeeze) otherwise you would have got screwed by this move.