Bitcoin is the world-leading cryptocurrency, and there are multiple ways for you to participate in the underlying price moves.
Upfront, in case you do not know us: the name NeverLossTrading derives from the concept of trade repair instead of accepting the stop loss, and Never Stop Loss Trading was a bit lengthy. We trade our own accounts and offer high-probability algorithmic trading systems and strategies for private investors.
People sometimes ask why it is called cryptocurrencies: because they use cryptography to keep it secure. There are no physical bitcoins; only balances are kept on a public ledger that everyone has transparent access to (although each record is encrypted). Bitcoin is the most popular of hundreds of other cryptocurrencies and is abbreviated as BTC when traded. At the time of this article, for trading one BTC, you need about $40,000. However, you can buy fractions of Bitcoins: One Bitcoin divides into 1,000 millibitcoins (mBTC); 1,000,000 microbitcoins (μBTC); or 100,000,000 satoshis (the name of the unknown inventor).
A simple and effective way for trading Bitcoin is to operate with the BITO EFT. ProShares is the fund manager of BITO and bases the ETF value on relation to investments in the Bitcoin Futures. The ETF provides a solid options chain and, on an average day, exchanges more than 10 million shares. Currently, one share of BITO is worth about $25 and offers a daily value change between 5% and 10%. Hence, an instrument that gives you multiple opportunities as a trader to participate in the volatile moves of the underlying. One thing to consider: when trading ETFs, you need to comply with SEC regulations for day trading and shorting stocks; you need account holdings of a minimum of $25,000. BITO is usually HTB (hard to borrow), and as such, you best operate with an options strategy to bet on a falling Bitcoin value with this instrument.
For retail traders, Bitcoin offers the possibility to participate in extraordinary strong price moves. To demonstrate the variability of the Bitcoin price, we compare it in a chart to the S&P 500.
Bitcoin Futures and S&P 500 Annual Price Development
The chart shows the S&P 500 spaned a price band of 13% over twelve months, while Bitcoin Futures had a 60% variability. Hence, speculating for up and downside moves should be part of your strategy.
Futures traders have an easy way of trading for rising and falling prices. They have the choice of two instruments for participating in the price move of Bitcoin, both issued by the CME:
/BTC, the full contract is based on five Bitcoins. A value change of $5 represents one tick and shifts the future value by $25. The actual margin requirement for trading this contract is $75,000, and you control a notational value of $200,000 (five Bitcoins, each valued at $40,000).
/MBT, the Micro Bitcoin Futures Contract, with a contract size of 0.1 Bitcoin. Again, a value change of five represents one tick and shifts the value of the underlying contract by $0.5. For trading this contract, your broker will reserve a maintenance margin of $1,500, and you control a notational value of $4,000.
The question is, how to best forecast the price move of Bitcoin?
We recommend the NLT Timeless Concept and a combination of the NLT Trend Catching and SPU Move indicators, which helps you to find and act at crucial price turning points.
With the NLT Timeless Concept, you cut price moves into manageable sub-increments that simultaneously keep risk and reward in compliance with the system’s expected high probability forecast at or above 65%.
Hence, you will trade with a positive expectation, but you must learn and comply with the rules. Therefore, we teach the concept one-on-one on your best available days and times, tailoring our systems and concepts to your wants and needs.
We best explain some of the details to learn in a chart example, picking the /BTC Futures Contract. Then, you will see five situations we discuss based on a mechanical approach, where we take every signal as valid, and you learn in the mentorship which ones are higher probable.
/BTC on the NLT Timeless Chart
Situation-1: We see two buy signals, the first one on February 24, 2022, and the second on February 28; both got confirmed in the price movement of the next candle and came to target (gray dot on the chart). Two winning trades.
Situation-2: Short signals and a price move to the red dot. A winning trade.
Situation-3: Long signal and a price move to the blue dot on the chart. Immediately after a short signal, which got stopped, producing one winning and one losing trade.
Situation-4: Three long trading opportunities, and all came to target.
Situation-5: The first sell signal came to its stop at the red crossbar – and we would not take this signal for multiple reasons. The second signal came to target, producing one winning and one losing trade in this sequence.
In summary: Eight winning and two losing trades between February 24 and April 11, 2022. Each transaction was good for a value change of about $10,000.
Next, we pick a day trading example for the /MBT:
/MBT on the NLT Timeless Day Trading Chart
On April-4, you see a long opportunity that came to target after the re-opening of futures trading at 6 p.m. ET on April 5.
April-5 shows a short signal that came to the red dot target.
April-6 shows multiple short signals that all came to target.
Three solid winning days. Trading one contract produced a value change of about $70 in each situation.
Let us now take a look at the ETF development on a swing trading basis and one rule to consider: do not trade candle #5, which is highlighted for this reason:
BITO on the NLT Timeless Chart, April 2-11, 2022
The chart shows seven winning and one losing trades.
When we get your interest in this, contact us, and we will show you live what our system can do for you.
contact@NeverLossTrading.com, Subj.: Demo
We have more than ten years in business and helped many traders get independent in the financial markets. If you like to read more about our concepts, subscribe to our free trading tips and check our blog.
Trading is not an easy career: when you add up what it costs you to not act at high probability price-turning points, you might be open to investing in a high probability system and appropriate education.
We highly propose following a business plan for trading success that shall entail:
- Written rules on when to trade and when not
- A financial plan that breaks down the number of trades needed to come to budget.
See our overview of learning elements we will go through in our coaching and training sessions, and we will focus with you on any asset class: Stocks, Options, Futures, and FOREX. The choice is yours. This is what we will share.
- Acting with a system probability > 65%
- Mechanical rules for entry, exit, stop
- Trade at perfect moments only
- Consider overall factors, patterns
- Risk and reward in an acceptable balance
- Risk-averse trading
- Holding positions to target
- Do not add to losers
- Stick with a trading strategy. Follow a business plan – action plan and financial plan
- Trade for meaningful price moves
- Systematic trading
- Having a mentor to learn from
Here is a schematic:
The frightening truth: 76% of private investors lose money!
We base this number on a study we conducted, and if you like to experience why: write us an email, and we will share the details: contact@NeverLossTrading.com Subj.: 76%.
Who had assumed such a high rate of losing traders?
If you want a different trading career, find a solid training and coaching program and contact us to find out what could work for you:
contact@NeverLossTrading.com Subj: Demo.
We are ready to share our experiences, helping private investors to build their trading business. Trading is not a typical career, and you best learn from those who are long-term in this business to cope with the rollercoaster of the financial markets. We are here to help and provide feedback on what you might be doing right or wrong.
Make a change to your trading results, and we will find out which of our systems suits you best.
We are happy to hear back from you,
Thomas Barmann (inventor and founder of NeverLossTrading)
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