2 BTC to 20 BTC Trading Challenge - day 11 (1.4389 BTC)
Disclaimer: If you are primarily interested in copying other people’s trades then this is not for you. However, if you are willing to put in the work that it takes to learn how to trade for yourself then you have found the right place! Nevertheless please be advised that you can give 10 people a profitable trading strategy and only 1-2 of them will be able to succeed long term. If you fall into the majority that tries and fails then I assume no responsibility for your losses. What you do with your $ is your business, what I do with my $ is my business.
Click here for my Comprehensive Trading Strategy | Click here for my Comprehensive Trading Process | Click here to learn about the 2 BTC' to 20 BTC' Trading Challenge
The slow start to this challenge has caused me to take a step back and look at the charts from a wider perspective. This is done as a way to verify my view of the overall trend as well as to look for any larger patterns that could be dominating the price movement.
Trading a smaller pattern that is embedded within a larger pattern can often lead to whipsaws and traps. The big money / smarter traders will be looking at the larger pattern and trading it while using the smaller pattern to set traps and gain liquidity.
USDHUF is a perfect example of this
I was trying to trade the ascending triangle above while forgetting / failing to realize that the dominant chart pattern is a symmetrical triangle that has been forming over 18 years.
It is okay to trade smaller patterns that form inside larger patterns as long as you are aware of the dominant pattern and it's implications.
Open Positions
Long: USDTRY
Price: $5.55804
Projected Risk: 5.66%
Leverage: 100X
Exposure: 0.16 lots ($16,000)
Margin: 0.048 BTC
Unrealized PnL: -0.0811 BTC
Notes: Support holding above the phase 3 trendline is going to be very important for me to maintain a healthy bankroll for this challenge.
Long: USDZAR
*1/3/19 SCALE OUT: P < S MA = 5%. However minimum available to scale out was 8%
*1/6/19 SCALE OUT: P < S MA (5%) + Bearish M MA (30%) + Bearish Cross with S & M MA’s (15%) + P < flat L MA (25% - 50%)
*1/7/19 SET STOP LOSS: Stop loss set at $13.489 for remainder of position.
*1/9/19 ADJUSTED STOP LOSS: Moved stop to $13.64 due to expected support from 200 MA.
*1/11/19 DEATH CROSS signals final scale out. However on TD red 9 at horizontal and trend support. Leaving stop at $13.64 due to bullish 200 MA and support cluster. Negligible difference in risk, huge difference in potential gain.
Price: $14.48
Projected risk: Market stop set at $13.49
Leverage: 100X
Exposure: 0.06 lots ($6,000)
Margin: 0.0157 BTC
Unrealized PnL: -0.0777 BTC
Realized PnL: -0.068 BTC
Short: SPX500
*1/4/19 ADD TO POSITION: S MA making bearish cross with M MA = 15% added
*1/6/19 SCALE OUT: P > S MA (5%) + bullish M MA (30%) + Bullish cross with S & M MA’s (15%) = 50%
*1/11/19 GOLDEN CROSS does not necessarily signal scale out due to angle of L MA. Stop loss set at $2,656.
Price: $2,472.62
Projected Risk (horizontal resistance at $2,650): 7.44%
Leverage: 100X
Exposure: 0.09 lots ($22,276)
Margin: 0.0586 BTC
Unrealized PnL: -0.304 BTC
Realized PnL: -0.129 BTC
Notes: Major horizontal resistance from $2,600 - $2,650. Stop set at $2,656
Long ETHUSD
*1/10/19 Scale in due to support from bullish L MA
Price: $125.68
Stop: $119.45
Risk: 4.9%
Leverage: 10X
Exposure: 12.68 ETH (0.4386 BTC)
Projected Risk: 0.021 BTC
Unrealized PnL: +0.0049 BTC
Realized PnL: -0.0003 BTC
LONG XRPH19
*1/11/19 SCALE IN: P < Bullish L MA represents oversold asset in bull market.
Enter: 0.00009135
Stop: 0.00008888
Risk: 2.7%
Exposure: 20,267 XRP (1.8518 BTC)
Leverage: 15X
Unrealized PnL: +0.0028 BTC
Realized PnL: -0.0046 BTC
Notes: Entry was not based purely on Consensio. Bitcoin futures curve in backwardation with widening spread is main reason I was looking to add to my long exposure. Also looking at confluence of support from trend and horizontal. Guidelines would have me waiting for close above S MA to start scaling in, but I really liked the risk:reward provided at today’s close.
Open Orders
*1/10/19 Stop market to short XAUUSD. Moved entry up to $1,284 due to that being below horizontal support & parabola and it provided better risk:reward. Consenio signaled entry today, but I’d prefer to wait for further confirmation.
Watchtower
USDHUF: 18 year symmetrical triangle.
USDJPY: (leaning bearish) Consensio is bearish on Monthly chart indicating that the triangle has a greater chance of breaking down. Tightest monthly BB has been since 1976 when the price proceeded to move 41% in ~21 months. Think that retesting $80 is most likely.
XRPUSD: In a Bollinger Band super squeeze on the weekly with lower highers and highers lows suggesting upcoming parabolic move either way...a/k/a Jesus Fish Pattern. Symmetrical triangle on daily provides first target of $1.1
USDCAD: Approaching bullish 200 MA while the M MA and L MA posture for death cross. Weekly A&E bottom with $1.63 target. Massive volume over last 3 years. Currently fitting into channel. Tightest weekly BB squeeze since 2000.
BTCUSD: Gap in the visible range volume profile looks like it is begging to get filled. If we close above $4,300 then a return to $5,400 - $6,000 would be my highest probability outcome. Will be strongly considering setting a stop order to add to my long above the daily Parabolic SAR. Backwardation appears to be getting slightly more exaggerated, currently 3.03%.
ETHUSD: First weekly buy signal since April 2018. Weekly appears to be getting rejected by TL + SAR. Potential for bearish englufing. Daily just broke SAR but is finding support from bullish L MA.
ETHBTC: Potential weekly Golden Cross upcoming. Pullback to 33 day MA could represent could entry.
LTCUSD: Waiting for close > daily cloud saved me. Treating inside the cloud as a not trade zone can work very well. Now it appears to be finding support from the TL and trying to create another higher low.
XRPBTC: Incoming death cross following L MA roll over could be setting up ideal entry. However ascending triangle is still in tact and want to wait to enter until we get a close above / below.
XAUUSD: A few daily candles have closed above the trend line from 2016 but when zooming out to the weekly chart it becomes clear that the TL is continuing to hold as resistance, therefore it is still in tact. Daily looks like it is ready to break down at any moment and that is why I will be waiting with stop entry. Consensio is also starting to signal short entries with P < S & M MA while those are making a bearish cross.
EURUSD: (leaning bullish) L MA and LL MA squeezing with price between on weekly and the LL MA appears to be making bullish reversal. Seeing a potential A&E bottom. Bollinger Band in tightest squeeze since 2014 and a 24% move followed that one.
USDRUB: Symmetrical triangle forming above bullish 200 MA that is approaching the price. Also had a recent GGC on the weekly.
Click here for my Comprehensive Trading Strategy | Click here for my Comprehensive Trading Process | Click here to learn about the 2 BTC' to 20 BTC' Trading Challenge
The slow start to this challenge has caused me to take a step back and look at the charts from a wider perspective. This is done as a way to verify my view of the overall trend as well as to look for any larger patterns that could be dominating the price movement.
Trading a smaller pattern that is embedded within a larger pattern can often lead to whipsaws and traps. The big money / smarter traders will be looking at the larger pattern and trading it while using the smaller pattern to set traps and gain liquidity.
USDHUF is a perfect example of this
I was trying to trade the ascending triangle above while forgetting / failing to realize that the dominant chart pattern is a symmetrical triangle that has been forming over 18 years.
It is okay to trade smaller patterns that form inside larger patterns as long as you are aware of the dominant pattern and it's implications.
Open Positions
Long: USDTRY
Price: $5.55804
Projected Risk: 5.66%
Leverage: 100X
Exposure: 0.16 lots ($16,000)
Margin: 0.048 BTC
Unrealized PnL: -0.0811 BTC
Notes: Support holding above the phase 3 trendline is going to be very important for me to maintain a healthy bankroll for this challenge.
Long: USDZAR
*1/3/19 SCALE OUT: P < S MA = 5%. However minimum available to scale out was 8%
*1/6/19 SCALE OUT: P < S MA (5%) + Bearish M MA (30%) + Bearish Cross with S & M MA’s (15%) + P < flat L MA (25% - 50%)
*1/7/19 SET STOP LOSS: Stop loss set at $13.489 for remainder of position.
*1/9/19 ADJUSTED STOP LOSS: Moved stop to $13.64 due to expected support from 200 MA.
*1/11/19 DEATH CROSS signals final scale out. However on TD red 9 at horizontal and trend support. Leaving stop at $13.64 due to bullish 200 MA and support cluster. Negligible difference in risk, huge difference in potential gain.
Price: $14.48
Projected risk: Market stop set at $13.49
Leverage: 100X
Exposure: 0.06 lots ($6,000)
Margin: 0.0157 BTC
Unrealized PnL: -0.0777 BTC
Realized PnL: -0.068 BTC
Short: SPX500
*1/4/19 ADD TO POSITION: S MA making bearish cross with M MA = 15% added
*1/6/19 SCALE OUT: P > S MA (5%) + bullish M MA (30%) + Bullish cross with S & M MA’s (15%) = 50%
*1/11/19 GOLDEN CROSS does not necessarily signal scale out due to angle of L MA. Stop loss set at $2,656.
Price: $2,472.62
Projected Risk (horizontal resistance at $2,650): 7.44%
Leverage: 100X
Exposure: 0.09 lots ($22,276)
Margin: 0.0586 BTC
Unrealized PnL: -0.304 BTC
Realized PnL: -0.129 BTC
Notes: Major horizontal resistance from $2,600 - $2,650. Stop set at $2,656
Long ETHUSD
*1/10/19 Scale in due to support from bullish L MA
Price: $125.68
Stop: $119.45
Risk: 4.9%
Leverage: 10X
Exposure: 12.68 ETH (0.4386 BTC)
Projected Risk: 0.021 BTC
Unrealized PnL: +0.0049 BTC
Realized PnL: -0.0003 BTC
LONG XRPH19
*1/11/19 SCALE IN: P < Bullish L MA represents oversold asset in bull market.
Enter: 0.00009135
Stop: 0.00008888
Risk: 2.7%
Exposure: 20,267 XRP (1.8518 BTC)
Leverage: 15X
Unrealized PnL: +0.0028 BTC
Realized PnL: -0.0046 BTC
Notes: Entry was not based purely on Consensio. Bitcoin futures curve in backwardation with widening spread is main reason I was looking to add to my long exposure. Also looking at confluence of support from trend and horizontal. Guidelines would have me waiting for close above S MA to start scaling in, but I really liked the risk:reward provided at today’s close.
Open Orders
*1/10/19 Stop market to short XAUUSD. Moved entry up to $1,284 due to that being below horizontal support & parabola and it provided better risk:reward. Consenio signaled entry today, but I’d prefer to wait for further confirmation.
Watchtower
USDHUF: 18 year symmetrical triangle.
USDJPY: (leaning bearish) Consensio is bearish on Monthly chart indicating that the triangle has a greater chance of breaking down. Tightest monthly BB has been since 1976 when the price proceeded to move 41% in ~21 months. Think that retesting $80 is most likely.
XRPUSD: In a Bollinger Band super squeeze on the weekly with lower highers and highers lows suggesting upcoming parabolic move either way...a/k/a Jesus Fish Pattern. Symmetrical triangle on daily provides first target of $1.1
USDCAD: Approaching bullish 200 MA while the M MA and L MA posture for death cross. Weekly A&E bottom with $1.63 target. Massive volume over last 3 years. Currently fitting into channel. Tightest weekly BB squeeze since 2000.
BTCUSD: Gap in the visible range volume profile looks like it is begging to get filled. If we close above $4,300 then a return to $5,400 - $6,000 would be my highest probability outcome. Will be strongly considering setting a stop order to add to my long above the daily Parabolic SAR. Backwardation appears to be getting slightly more exaggerated, currently 3.03%.
ETHUSD: First weekly buy signal since April 2018. Weekly appears to be getting rejected by TL + SAR. Potential for bearish englufing. Daily just broke SAR but is finding support from bullish L MA.
ETHBTC: Potential weekly Golden Cross upcoming. Pullback to 33 day MA could represent could entry.
LTCUSD: Waiting for close > daily cloud saved me. Treating inside the cloud as a not trade zone can work very well. Now it appears to be finding support from the TL and trying to create another higher low.
XRPBTC: Incoming death cross following L MA roll over could be setting up ideal entry. However ascending triangle is still in tact and want to wait to enter until we get a close above / below.
XAUUSD: A few daily candles have closed above the trend line from 2016 but when zooming out to the weekly chart it becomes clear that the TL is continuing to hold as resistance, therefore it is still in tact. Daily looks like it is ready to break down at any moment and that is why I will be waiting with stop entry. Consensio is also starting to signal short entries with P < S & M MA while those are making a bearish cross.
EURUSD: (leaning bullish) L MA and LL MA squeezing with price between on weekly and the LL MA appears to be making bullish reversal. Seeing a potential A&E bottom. Bollinger Band in tightest squeeze since 2014 and a 24% move followed that one.
USDRUB: Symmetrical triangle forming above bullish 200 MA that is approaching the price. Also had a recent GGC on the weekly.
Comment:
No changes to the Trading Challenge so I am going to skip making an update today. I hope everyone is enjoying their weekend! If you are then take a brief moment to be grateful for what you have.
emasar Indicator is available for purchase at alphanalysis.io/product/emasar/