I used to follow some Telegram crypto channels that providing trading signals about what to buy what to sell, those signals are mainly focused in altcoins with the goal of gaining more value against BTC. They are mainly based on two things, technical analysis(TA) and news.
Image source
TA is what I believe the least if not at all
Cryptocurrencies(aka Blockchain) is something that is going to change our world forever like the Internet. The world had no idea the Internet can achieve what it has achieved today, no way for the mass to predict the future of a disruptive technology in the infant stage. The same conclusion applies on the cryptocurrencies. If you used the same old technique that used to analyze traditional market like stock and precious metal, in analyzing a market that never exists before, it just doesn’t make sense. However, if you really need to learn how to do some awesome TA on crypto, this is the only guide you need to read presented by @kevinwong.
Trading the news is making more sense
Buy the rumor, sell the news is really an effective tactic only if you are active and sensitive enough to sniff all the slight movement of a straw in the wind. But that is going to take a heavy toll on your time if you follow more than 5 projects. And you might get caught in the fake news by the pump-and-dump folks, ended up executing wrong moves and lose money.
Furthermore, trading altcoins short or medium term base on abovementioned tactics has a really huge disadvantage. That is when the whole market crash, which usually lead by the Bitcoin, altcoins drops 10~20% more than BTC. After the recession, market will always enter bullish movement(if you are wondering this is how the economy works, not TA) which usually will be leading by BTC, again. And the already in-red altcoins will be bleeding even more against BTC. This is a losing war without ending, unless you are changing them to long-term holding.
This is not an empty sentiment but I’m speaking from experience.
In fact, my altcoins portfolio is still at -50% loss from the last 800B-to-400B crash which was about 2 months ago. If my initial investment was 1 BTC, selling all those altcoins that I bought according to the trading signals would leave me not more than 0.5 BTC.
This is why I stop the active trading at all as I don’t want to sell at loss. And this is what making me reflects on this investment strategy that would be useful in the bullish market, but locking me up upon the bear arrival. After all, making them as my long-term holding coins probably is one of the best plans available now.
There are more ways to force you into the loop of mistakes and I’m not going to list them all, after all it would take me at least 10 posts to finish that list. Just have to take my time for a reflection in low tide as of now. Trading signals are not really effective in growing wealth all the while, I shall keep experiment and tweaking the strategies.
Stay tuned.
不交易货币好久，这段时间也该好好反省之前所执行的炒币策略。前一阵子我根据 Telegram altcoin trading channel 给出的信号不断炒币，在那阵子的牛市中的确有所斩获。然而在现在的熊市就不行了。那些信号主要有两种根据，technical analysis (TA) 和新闻。
用 TA 这种旧技术来分析前所未见的加密货币市场这件事，对我而言是相当可笑的，所以从来也不屑一顾。基于新闻的信号就比较有看头了，很明显的所有货币都被各种好坏消息显著的影响着。如果你有本事捕捉各种最新消息，那么很大可能是可以获利的，只是代价就是要付出大量时间精力。
这样根据信号的交易方针坏处就是一旦市场崩溃，统统就会被套牢了，也是我目前的囧境。看来必须要好好乘这个低潮期好好反思一下有什么可以更进取的地方。
This page is synchronized from the post: ‘Reflection of my trading strategy that is not working really well’