How do you day trade?

[Remember remember the 5th of November]

I have bitcoins, no USD. I wanted to profit a bit by selling high, buying low, but due to the price volatility I actually lost 0.13 bitcoins already.

I am already regretting I sold 11.74 bitcoins at 137, losing $1000 dollars by now, and decided to make up for it by trying to increase my profits from some leftover coins.
But make no mistake, I am new to "day trading". Most of the terms related to trading and so on are not even known to me.

So the point is, how do you profit from this when I cannot buy, as I cannot sell because the price is increasing and super volatile making me hoard the coins OR if I do decide to sell, lose money when it goes up and up?

[1713583803]

1713583803

[empoweoqwj]

If you are new, I wouldn't even bother. Why trade when you can just hold?

[Remember remember the 5th of November]

If you are new, I wouldn't even bother. Why trade when you can just hold?

Yeah, but then how do you increase your profit without mining?

[CoinDiver]

Smartest "trade" I ever made was trading my MtGox wallet for an offline wallet. My coins are now safe, most importantly, from me.

[DataPlumber]

Smartest "trade" I ever made was trading my MtGox wallet for an offline wallet. My coins are now safe, most importantly, from me.

+1

[daybyter]

Look for Price-Differences and do arb?

[dutt]

You can try btc-e and trade bitcoin against any of the other currencies. Of course it is very risky.

[MikeH]

I'm no expert but I would assume to day trade you would want bitcoins fluctuating rather than constantly going up.

[iameric]

I created a trading bot which uses the last trading price to calculate two exponential moving averages based on a 15 minute periods.

It's been very effective since the start of April I've had 9.8% gain, 27.6% gain, a 26.5% gain, and I'm currently sitting at a 20% gain where I bought in at $188.

I have been considering opening my webbased trader to the public and created a thread/survey to gauge potential interest, expectations, etc.

[dutt]

Do you measure those gains in Bitcoins or fiat?

[iameric]

That's comparing the purchase price in USD to the sale price in USD.  That also doesn't include fees though which would reduce the profits by a percent or so.

[dutt]

Okay, well compared to the market you didn't do that great then  Just buy and hold would have outperformed you easily.
Try make the bot so that it increases actual bitcoins, not just fiat value.

[iameric]

Okay, well compared to the market you didn't do that great then  Just buy and hold would have outperformed you easily.
Try make the bot so that it increases actual bitcoins, not just fiat value.

Yes but hindsight is always 20/20.

Of course if you knew the market was going up and no matter high it hit you were confident it did not peak yet and would still trend upwards then it may very well be in your best interest to hold for the long term.

However I'm sure everybody is astonished that bitcoin is still climbing strong and nobody knows which peak will be the last one and when is really the best time to sell.

It's wise to diversify your investments through different trading strategies to hedge any potential drops in the market.

[dutt]

Yea but I was saying that your strategy could be useless. With price increasing as steadily as it has, you could've bought and then sold randomly and made a profit 9/10 times.

[ElectricMucus]

The information you are asking for is worth billionstrillions of dollars. Nobody, and I mean nobody will even sell it if it really works.

[iameric]

Yea but I was saying that your strategy could be useless. With price increasing as steadily as it has, you could've bought and then sold randomly and made a profit 9/10 times.

It wouldn't be useless it just wouldn't be the most efficient/effective means to maximize your profit.  That is if you are extremely confident in the price still going to continue to climb and you are in fact correct in your assumption.

But then you also have the issue of determining when to sell, you sell to early you miss out on a whole bunch of profits, same goes for if you sell too late.

[iameric]

Yea but I was saying that your strategy could be useless. With price increasing as steadily as it has, you could've bought and then sold randomly and made a profit 9/10 times.

It wouldn't be useless it just wouldn't be the most efficient/effective means to maximize your profit.  That is if you are extremely confident in the price still going to continue to climb and you are in fact correct in your assumption.

But then you also have the issue of determining when to sell, you sell to early you miss out on a whole bunch of profits, same goes for if you sell too late.

Right... that's his point. There is no "system" therefore your strategy that returned

"I created a trading bot which uses the last trading price to calculate two exponential moving averages based on a 15 minute periods. It's been very effective since the start of April I've had 9.8% gain, 27.6% gain, a 26.5% gain, and I'm currently sitting at a 20% gain where I bought in at $188."

...is arbitrary, because 15 minute windows down to any 1 transaction is still a guessing game, and you can provably show times where that would amount in an overall loss. Assuming you're not buying at every single pulse, the odds are basically that buying is going to be at a value lower than it will be in the future.

It's not quite arbitrary using one short and one long exponential moving average you can tell when the recent average breaks out of the long average, that is to say the short EMA crosses over the long EMA your script buys, when the long crosses under the short average (short EMA crosses under the long EMA) you sell.  The 15 minute window you mentioned earlier is not so much a window as it is the length of time before checking the current ticker data and recalculating the current short and long EMAs.

There's not a buy or sell every 15 minutes just the opportunity IF the EMAs crossed during that period.  Below is a graphical representation of my most recent trades.

The blue line is the short EMA, the red line is the long EMA, and the orange line is the price.

A) Buy @ 143 USD
B) Sell @ 181 USD
C) Buy @ 188 USD
https://i.imgur.com/upvuhFq.jpg

[PachucoBro]

<Tom Hanks voice>

There's NO DAYTRADING in BitCoins!

You're doing it WRONG!

Yeah as some others have said you can't go day trading something that only goes UP. Also as others have said... you are your worst enemy for right now by having the ability to sell you bitcoins thinking you can buy lower and profit.

With typical fees of 1.2% and prices of $200+ you are talking about a move of about 8-10%.

Now I say 8-10% because if you look at charts you will not reliably sell at the peak and buy at the bottom. So shrink down a bit from that 10% swing and you are at like a 5-7% range then you have the delay in the order going through (~2-4 minutes on MtGOX from what I have noticed in peak action) which might eat up another 1-2% or totally ruin you and you miss your entry or exit. MtGOX is not as fast as a FOREX or eTrading stock brokerage.

It's just not profitable right now... unless there are decent, predicatble swings of more than $10-$20 (which is only 5-10%) then you aren't going to be helping yourself out.

It may not seem exciting, but buying and holding bitcoins is actually AWESOMELY profitable!

I first started trading on April 1st @ $104, but was doing day trading crap... I really started to buy and hold @ $135 or so. Earlier to day I was at 47% profit in 9 days.

I just bought another $500 worth @ $237 so now I am down to only 37.61% LOL AWESOME! I made more with bitcoins in 9 days than I have with my 401k in 3 YEARS!

[PachucoBro]

comparing it to a 401k (an ideal, non-disappearing 401k at least) is odd too, because look at how much volatility difference there is.

I was comparing it to my 401k in that ... the % returns I am getting on my money in 9 days is higher than what I have gotten over waiting 3 years. I have credit cards and loans that I am paying over the minimum to pay off and am switching back to minimums and putting the cash into BTCs.

[btchaver]

Look for Price-Differences and do arb?

what is arb?