Husband does not want me to Day Trade BTC but it works well for some, right?

[BitChick]

Hi.  I have had some debates with my husband over this.  We have invested several thousand into BTC and he is of the mindset to just "buy and hold." (Unfortunately, we did not purchase them super low.  The average price we paid for them is $120)  I have been trying to convince him that we would be better off trying to sell some, wait for it to drop a little, then we will have the buying power to buy even more if we repeat this a few times.  He thinks we will just get burned and it is better not to play that game.  He said it is like his friends that go to Vegas.  They leave with $2000 then come home with $500 and brag that they won $500, bun in reality they lost $1500.  But I disagree that it is entirely a gamble. I think many of you have seemed to do very will with day trading.  For me, it would be the only way we could increase our small BTC stash since we do not have the money to buy any more. 

So my question is, have many of you successfully increased your BTC numbers day trading?  And what is your best strategy in doing so?

[qxzn]

I tend to side with your husband. You risk a lot day trading, not to mention the time and mental energy you're putting into it. Sure, you might make more money, but you also might miss out on a lot of upside by not holding as much bitcoin as you would otherwise be holding when the price goes up.

As with gambling winnings / losses, you will probably hear much more about the gains than the losses in replies on this thread. Not like what your husband says, where people pretend they didn't lose. Just that people tend to tout their winnings, but those that have lost will tend to not post about it, or maybe they're fed up with bitcoin and have left the forums.

You still might want to trade, but only if you really specialize in trading, really know what you're doing, and believe you have an edge that few other traders have.

For most people who trade, the emotional rollercoaster leaks into the rest of their life, too. It's a cost many traders underestimate. If you weren't trading, what else could you be doing with your time and energy? Go learn to dance or something . Or if you want more coin, do something you're good at or love doing, get paid for it, and then buy more bitcoin. Tuck away some money into bitcoin every month, to dollar-cost-average.

Finally, if bitcoin really takes off, you're not going to care all that much that you got in at $120 instead of $60. Millions divided by two is still millions.

[niko]

The only active trading that makes sense to me is the case of risk management: if you wish to not "beat the market", but reduce the risk of loss while still making profits. I had taken on this approach for a period of several months, and made 100%-ensured, predictable profits. These profits turn out to be lower than if I held and sold today, but I had essentially zero risk.

Now that I took profits and rewarded myself with real-life goodies, I can keep holding the rest of coins.  I am waiting for good opportunities to spend them directly - and these days are approaching! Also, if I need fiat cash urgently, I'll trade some coins. If I've got extra cash, I'll buy coins. That's it.

[BitChick]

Or if you want more coin, do something you're good at or love doing, get paid for it, and then buy more bitcoin. Tuck away some money into bitcoin every month, to dollar-cost-average.

Finally, if bitcoin really takes off, you're not going to care all that much that you got in at $120 instead of $60. Millions divided by two is still millions.

Wise advice.  You are probably right.  I have been trying to sell some crap on ebay and fund some more BTC.  It is probably the safest way.  And yes, the $120 could be a drop in the bucket. 

[repentance]

If you can't afford to buy more BTC, then you can't afford to day trade.  One bad decision could wipe you out.

[yucca]

One false move in daytrading wont wipe you out. Au-contrair... If a fast correction to low-price happens then you have more chance of escaping if you are actively trading than just holding, because there is a chance you are in fiat at the time.

But be careful with trading, keep your heart out of the equation, this is difficult when you get the buzz of a win and chase it, while ignoring the losses. it IS just like vegas, and the exchange is the house and it always wins.

I suggest if you do want to try trading then take advantage of the percentage fees, this means you can place small trades. So if you have confidence that you can do a little better than market average (with a little extra for the exchange) you can try turning 0.5 BTC into 0.75 BTC and continue if you do good.

[BitChick]

If you can't afford to buy more BTC, then you can't afford to day trade.  One bad decision could wipe you out.

We only invested what we could afford to lose 100% of.  Granted, I like to have a little more liquidity.  However, with hockey playoffs starting maybe it is a good thing that all of our "extra cash" is tied up right now!   Last year we spent WAY too much on Stanley Cup Playoff Tickets!!  I wish I had that cash now to invest in BTC!   

[LiteBurner]

I would have made more money if I just held when I bought low instead of trading.

[Wardrick]

Honestly screw day trading. I tried it once and I sold my coins at $125 and suddenly it rose up to $138 within minutes. It's really not worth the risk unless you're running a bot or have high amounts of BTC to recover from the loss if you take one.

With a low amount of BTC, it isn't worth it. One slip up can send you on a downward spiral, and you wouldn't be able to recover because the low sum of btc.

[Lethn]

I'm with Wardrick, don't do day trading unless you fully understand what you're doing, what I'm doing is working on getting businesses set up that accept Bitcoin instead people are too obsessed with getting rich quick and think because someone else does it they'll automatically be able to do it as well. The best thing in this kind of economy is to make sure that you can make money and then preserve that wealth so that you don't end up screwed when the banks finally collapse.

People who day trade often are either very lucky, got in early or have a much better mindset and technical understanding of the charts and price movements that go on in day trading. It may well be better to put a small percentage towards these people and let them manage for you rather than do it yourself. I went and tried doing day trading in forex for awhile and places like that and I just couldn't wrap my head around the concept so now I'm sticking with what I know best, hammering and bending precious metal and drawing artwork .

You really would be better off setting up a business or something that accepts Bitcoin and building up a nice surplus for yourself that can't be stolen by banks.

[seleme]

Depends do you really think you are capable of doing day trading. If you think you are and can educate yourself fast then your entry point (120$) is too high to just sit on them as much as ultrabulls who mined coins in hundreds or thousands or bought them at 5 or 10 would want you to do that as that's what fits their plans.

They'll sell their coins at much lower point and still make huge profit then you are going to do as their initial investment was much lower than yours. There are many of them who can become millionaires if price reach 500 for ex. (many of them even earlier) so you can bet lot of them would be tempted to push sell button at that, or even earlier point. When they are selling, price go down as they sell in big quantities so you are left with even less difference or even in loss. So don't really take anything they say as complete truth, each or almost each word written here is self-interest based

So my advice would be that you try to trade, use small volume on the beginning until you are comfortable enough. If you fail trading with those small volumes then quit. Bitcoin is highly speculative and manipulative commodity, and will be like that in significant future so there is still lot of risk in holding it with such entry point + there are so many ups and downs that give you a chance to even grow your position. Just be prepared for long and hard work as volatility is so big that you can't afford yourself to sleep

And on the end - do what you and your husband find to be best thing, don't really listen to me and specially don't listen to "it's gonna be 5000" in May gang. It's your money, not mine or anyone else's, we don't give a damn about it and lot of us will give you advice that is best for our interests, not yours, there are so many scumbags around here and you shoud never, ever take the word of anyone just like that. Nobody won't lift a finger if you lose those couple of grants. Do your own thing after researching all options.

[seleme]

The thing about a small amount is that it is much easier to trade a small amount than a large amount

Definitely.. it's much easier to make decision on 1 btc than 100 of them

[Zaih]

You're just going to add more variance and in theory, you'll be gambling.

Unless you feel you have some edge/knowledge over the market then you're best off just sticking it for the long term.

[ironstove]

Just remember if you're day trading, it's you, a normal human being with little to no finance knowledge and experience versus a plethora of high speed, high frequency bots that have been programmed with highly efficient and thoroughly tested algorithms which will make money regardless of which direction the markets moves due to the various theories and techniques they employ, all of it without the FUD/emotion/greed polluting their thought process.

I day trade along with bots I've programmed each employing a different set of algorithms and the best advice I can give you is to practice on paper first, set aside maybe 50% of your holdings on paper, and gamble with them (yes I said gamble because that is basically what you're doing with you FA/TA to back up your theory, no algorithms or trading strategies, you're basically just flipping coins and calling sides).

Do your 50% on paper, and treat this like it is watch how fast you lose your money... I've seen many day-traders trying to beat the market and all of them getting burned eventually, making money here and there but doing one very poor trade resulting in a net loss of maybe 30-40% of their holdings, completely negating all of their gains, which then puts them on tilt and causes them to trade more aggressively, make greedier calls to regain their old positions, and then they just spiral downward until they hold a measly 20-30% of their original portfolio and realize they just made a bunch of other people rich

Most successful traders I've seen on here and in real exchanges like forex or stocks usually have bots assisting them in making calls... I think about 99% of manual day-traders I've seen eventually fall off the grid because they fail miserably and drop out of the market after losing 50%+ of their holdings after making a huge fuss about multiplying their initial investments by 5x+ with a few lucky manual trades.

Not to scare you or anything, when I first started I lost a lot of money, realized how naive I was for even trying to jump into a market full of sharks and expecting to dominate and refined my methods for years with play money before giving it another try and doing modestly well. I should also point out that I had good performance on my stock portfolio with long investments way before I even thought to day-trade.

tl;dr day trade if you want, but if you're going to use your real money and you've never traded before and have no finance knowledge, then use no more than 5-10% of your portfolio, and don't be greedy, don't be scared, and don't listen to other people in making decisions that will have no accountability if things go wrong i.e. board members. (Myself included!)

[wumpus]

http://www.jamesaltucher.com/2010/11/8-reasons-not-to-daytrade/

I tend to agree with him. It sounds very attractive to day trade... what if you'd sold on $250 and rebought on $50, you'd have 5-tupled your bitcoin holdings! But in practice tops and bottoms are impossible to call reliably so you'll make a lot of mistakes and that will be frustrating. In addition to that, it is really stressful and takes a lot of time, and it borders on obsessive-compulsive behavior. And, like with online poker, most people lose in the longer run.

[cdog]

If you have to ask this question, definitely dont bother. Buy and hold, its a deflationary currency so theoretically you cant lose by holding.

[mmeijeri]

I subscribe to the theory that there are only two likely long term outcomes: BTC becomes worthless or it becomes ridiculously valuable. Based on that I think buy and hold is a sensible strategy, provided you don't put too much money into it, and day trading isn't.

On the other hand, if everyone hoards their BTC, then it will never be used for real transactions and therefore won't become immensely valuable. If adoption grows, so will the exchange rate and at some point people will wisely start to cash out and adoption can increase even further. I think that if my small stash of BTC ever becomes worth $100k, I will sell 90% of it, if the remainder reaches $100k I will sell 90% of that and so on.

If the amount you've put into Bitcoin is more than you're comfortable holding for a decade or more, then you should sell off some of it until you are comfortable with it. You could time your sales, but I wouldn't buy anything, just try to offload your excess reserves near peaks in the exchange rate. Or even better, use the BTC to pay for goods and services, and maybe choose the timing for that wisely as well.

[solareclipse64236]

since when has it been stable enough to daytrade btc?

[Rampion]

If you can't afford to buy more BTC, then you can't afford to day trade.  One bad decision could wipe you out.

This.

[seleme]

The thing about a small amount is that it is much easier to trade a small amount than a large amount

Definitely.. it's much easier to make decision on 1 btc than 100 of them

The decision is no more or less difficult. The difference is the liquidity.

Don't agree. It's much easier to trade 1 bitcoin and have more free mind to make decision when you are trading something worth 130$ than 13 000$. I'm quite comfortable in trading my few coins as it wouldn't make lot of change for me if I'd lose them all but I doubt I'd think like that if my coins are worth 50k-100k.

Bigger value bring more emotions if you're not pro and emotions often lead to wrong and/or bad timed decisions.