Episode Highlights:
- 00:54 – What Is Bitpay
- 01:40 – China Bans Ico
- 02:14 – What Happened To Bitcoin When China Bans Ico
- 03:40 – A Closer Look At Bitcoin Crash
- 04:10 – A Look At Etherium Chart
- 07:27 – Trading Other Alt Coins
- 11:00 – How Often Should You Be Trading
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Transcription:
Hey guys what’s up with Dan from cryptocamacho.com, where I each day which I do find something to teach you about the coin, crypto currency, ALT coins, trading, something of value. I will try to bring that to you guys each day every time I make a video.
I want to teach you the tricks that I have learned. I don’t claim to be an expert but I do actively day trade Bitcoin and other crypto currencies. I position on trade those as well. Right now I am trading across five or six different platforms, different exchanges. I have Lacqui, Bittrex, BitFinnex, Polinex, and a couple of others, May be even more than five or six right now. I have been learning a lot on the way on how these exchanges work, how the script occurrences work. What block chain is, how to best day trade or position trade Bitcoin versus ALT coins and other crypto occurrences.
So I have been learning a lot along the way. I found a lot of really good tools and resources.
00:54 What Is Bitpay
I just came across a tool the other day called a bit pay, maybe some of you guys have heard about that. But basically what BitPay does it allows you to convert your Bitcoin into dollars or whatever local currency you are in and then spend it on an actual credit card at stores around you. So think of this I could literally go to Starbucks, I could use my bit pay credit card to buy at Starbucks and it is really being paid in Bitcoin that is being converted to fats currency, in my case the dollars. So pretty cool stuff.
A lot of market scanners are coming out. I have shared a few of those with you guys. Different conversion tools or exchange tools are coming out as well. So watch this space. A lot of things are going to be coming out now in the crypto currency world in the months to come. And this is not going to slow down, it is only going to heat up from there.
01:40 China Bans Ico
So today I really want to take you back to when China started banning ICO’s, when China started telling us that they weren’t going to allow exchanges and so forth. Because a lot of really interesting things happen in the market and in the charts and I will show you in a second here. But today, no after all the bad news has passed, after all the panic selling has happened, after all the Chinese crypto currency enthusiasts during their accounts and exchanges of their bitcoins. Now we can look at the charts and we can see what has actually happened.
02:14 What Happened To Bitcoin When China Bans Ico
The first one I will go to and what I want to talk about is Bitcoin. Check this out, for Bitcoin, there is a couple of things that happened. So right here, this dip, this entire dip right here happened because China announced that they were going to ban ICOs in China. So people started panicking – crashed. We got a crash and it went down to $3500 approximately. Then we go all the way back up to about $5000 and then you see we have more crashes right here. So right here, if you look at this really big dip that has happened recently, this happened because China announced that they were going to ban crypto currency exchanges in China and then there was a huge panic right here. People didn’t know how low this is actually going to go and it went all the way down to $2800 approximately. And now look at where it is today, where at $3986, about $4000 again.
So both times these crashes have happened, they are bug crashes. These are not small crashes, they are big, the market has recovered, it has gone past the base that it was at.
03:40 A Closer Look At Bitcoin’s Crash
So take a look at this a little bit closer, so let’s look at this base. So on the first crush, mark the base, right here. It goes up, goes up, goes up and then look what happened when it cracks the next base? It bounces up way up again, all the way back up. And this is not unique to Bitcoin. Look at etherium’s chart, and strangely, maybe not strangely, the etherium chart and the Bitcoin chart they look very very similar. I don’t know if you guys can notice that there are big dips right here, there are big dips right here. They look very very similar.
04:10 A Look At Etherium Chart
So let’s look at etherium’s chart. Let me zoom back out a little bit on this one. So again, same thing happen. Right here we have China banning ICOs, huge drop all the way from $400 all the way down to $276, that’s a big drop. And then we see it bounces back up to $341 and then the news comes out about China banning the exchanges, it goes all the way down and then bounces right back up. So if you could get into the bottom of these, just think of how much you could make.
Look at the bases. This is exactly the type of base trading that I was talking about. There is the base, that was last base, we get a good run up, we get it going down down down down down, up, we cracked the base right here; all of this could be bought and they look, we bounced all the way back up. Same thing. Look here is the base, the base is cracked all the way down here and then we get our run all the way up. When this happens over and over and over. This happens on the dash chart.
Let’s look at the dash chart. I feel like a broken record but it is really the simple. When you start looking at these charts and you start following them on a day-to-day basis, it is really this simple. It is not simple but it is hard to day trade, there is a lot of other things involved. There is patience. Patience is a huge factor. There is timing and timing the market correctly, when do you buy on the drops and when do you sell on the ups, do you taper and make multiple buys, do you taper and make multiple sells. There is a lot of different aspects to it and every trader needs to make that decision for themselves. What percentage are you after when you first make a purchase into the crypto currency that you are trying to buy, what percentage do you want to make on it? You have that in mind. You should definitely plan ahead of time if you want to make 10%, 15%, 20%, what do you anticipate and how do you know what are your odds of that? And I think that by using base trading, you can calculate almost all of that. Not all of it but most of it.
I mean, you look over here and let’s just use this for base as a dash. Again, this is the ICO, China said they’re going to ban ICOs, crash, recover. This is the exchange, China says it is going to ban exchange, crash, boom, recover. Now look at this, if I were to buy here, here is the base; that is the clear base. So anything below here you could have bought. What I would have typically done is I would’ve bought right here, I would’ve bought right here and then I would’ve done a lot bigger trades right down here. So I could really get in size at the bottom. In the beginning I may nibble a little bit. I may nibble just to get a little bit into the game. I can’t resist. I just want to get into the game. But then down towards the bottom I would make huge huge position on trades because I know it is going to bounce at least back to the base and maybe higher. In this case it is much higher.
So if you look at any of the currencies now, I mean look at this random alt coin, I don’t even know what this is. But it is essentially the exact same story. This is when the ICO’s happen, there is the crash, recover.
07:27 Closer Look At Trading Other Alt Coins
So let’s look at a couple of other alt coins because these, bitcoin, etherium and dash, they are all major crypto currencies. But what about the alt coins, what happened on the alt coins? Some of the alt coins weren’t affected. This is uBitcoin. And this wasn’t really affected to the extent that Bitcoin, etherium and the other major crypto currencies were. I mean, there are these drops but they’re not exactly in time with the ICO’s, they are dropping but they are not as stark, they are not as big a drops. But what did I do during this? Just the other day, I made a quick 10% or 20%, in this case it was 8.31%. And to do that little trick, just click on shift once and that is how you do it. One other trick I just recently learned with Coinigy is if you put your mouse over here to the site and you drag it up or down, you could either make the chart more narrow or more wide. And I like this because often, if I was trying to look at the chart down here I can’t see it. How do you see the chart, you have to move it all around. But that is just a pretty quick way to do it by jogging right here. A quick little tip.
So anyway look at this trade that I made. So I made this against this base right here. And I really should have waited until he dropped below here but I didn’t. I couldn’t resist and so I bought in. But I was playing off of this base right here essentially. And so that is what I did. I was in for a very quick minute. I wanted to get a quick buy. I think this trade took an hour or two, maybe three hours. And so I bought down at about $4100 and then I sold at about $4400. Again, 8.31% and I sold a little bit more over here. I didn’t end up selling it all for whatever reason, I thought it would spike higher. And I could have even waited, this is where patience comes in. I could’ve waited until he went all the way up to $4800 but I didn’t. I wanted to get out.
So let’s go over to one other trade, loon. Same thing here. I don’t show you this to brag, I show you this because I want you guys to know that this is completely doable. Start watching the markets, start looking at these charts, this is completely doable. This one I did off of this base. And I really should’ve waited until this base. But it still hasn’t cracked that base and I want to trade before it does. When it cracks this base, you’re going to have a bigger position to make. It would be a better position to do position trading, like I do here a lot bigger trades down here if it cracks this base. But these are the ones you can still do throughout the day. And I don’t do huge sizes, I do smaller trades throughout the day for day trading. And when bases are cracked that are this big, that is when I typically do big position trades and I would do huge huge trades which have a lot more meat on them and also can make a lot more money and have a lot to lower risk. These smaller day traders have a higher risk but they are fun. You can take nibbles on it, you could trade at smaller amounts.
So for this one I made about 11% and that was very quick too. Again, these are hour increments. In a two hour timeframe I made 11%. Think about that. If you put $1000 on this trade, within an hour you can make $100 minus fees. And the fees are fairly small.
11:00 How Often Should You Be Trading
And actually that is something I want to talk about. So fees and how often you should be trading. So I was in a chat room today where I get tons and tons of good info about trading and whatnot. But somebody asked the question should I be trading in one big trade or should I traded 10 small trades? And then they started talking about fees and percentages and how that all works. And they started asking what is a better approach? And it kinda dawned on me, where there are different approaches. They are both good approaches but they are just different approaches. Let’s say I had a $10,000 account and let’s say I wanted to make one trade using that $10,000 on one crypto currency, it could be Bitcoin, it could be etherium, it could be whatever. One trade, $10,000. My risk would be pretty high because of that trade goes south and goes wrong for whatever reason, maybe some news comes out or whatnot, I could lose a significant portion of my account like that. So it is definitely more risky. But it also requires a lot less work to actually do. There is one crypto currency you have to research, there is one trade you have to me, there is maybe a couple of alerts that you have to put before you make the trade, one coin you have to research so there is a lot less work involved. A lot less time-consuming. But it would definitely be more risky. Your upside could be just as great but your downside could also be just as great.
Now let’s take the other example, if you were to make 10 trades, what does that entail? Well if you make 10 trades, let’s say you have $10,000 and in each trade you’re going to put $1000 into, that means you’re going to have to research 10 or more different crypto currencies that you may want to trade in, that is a lot of work to do the research. You would have to put alerts on all 10 of those trades that you are looking at. Say have to put alerts on all different types of coins. Again a little bit more time-consuming. But your risk is going to be a lot lower, your risk is going to be much lower because you are spreading your risk across 10 different coins. But in reality it follows the market so your risk is based on the market when you spread it to thin.
So where is a happy medium? I typically like to trade anywhere from 2 to 5, or 2 to 7, seven gets a bit high and 2 only the bases have cracked on some very significant bases. So if a base cracked right here I’d maybe make that huge trade and I would take 70% of my account on that trade potentially. But I typically like to make multiple trades throughout the day. My sweet spot is maybe 3 to 5 because I think I can get size in there, I could maybe get my risk as well. So take that for what it is worth.
Hopefully this has been helpful for you guys. I will come out in a couple of days with a couple more videos about some of this stuff. I have an exciting video coming up about ICO and sentiment analysis and how you can marry the two together to actually find ICO’s that may perform better than others. And I would show you the methodology about how I go about doing this, I would show you how it is actually done. I am testing it right now. I am seeing some pretty interesting results with it as I am looking at after-the-fact as well. After the ICO launches in two months’ time, how does that perform and how does that correlate back to the sentiment analysis. So be on the lookout for that.
Anyway, hope you guys found this helpful. Leave any questions you have in the comments, again follow me on steem it. Go to steem it and the DC Enterprises if you can, follow me there, subscribe to this video. I’ll see you guys next time. This is Dan again from crypto Camacho. Go to cryptocamacho.com for more information and I will talk to you guys soon.
