My problem is that when I buy, I buy in the candles, and I always miss the best deals in the wicks. I started this thread to discuss the method of trying to catch the wicks, which seem to be short lived and arrive whilst I am asleep. We may not see $3,200 as a closing price, but we may see it in a wick if a bull squeeze develops.
The other advantage is that I believe that you avoid paying a commission on coinbase if you are a market maker.
I also think this is less of a concern for long term holders but it is still good to get the best buy you can. It is also much harder for long term holders because they don't tend to pay near as much attention to the market as a daytrader. My perspective as a daytrader..
I will like to reply to this because I think that making good buys has been my greatest strength/skill in trading. Not so much selling the top.
As they say, "you make your money when you buy".
To me a good buy is to get in at a place where if the market turns against you you will have ample opportunity to get back out of it with minimal losses. 1%-2% or break even. That is what I am most concerned about when I trade. What is the risk VS reward? If I can buy in a place to minimize my risk then it is much easier to take advantage of an opportunity for reward.
If the likely risk is only 1% then a 1.5% reward opportunity is good.
If you are buying BTC to hold what do you feel is your risk VS reward? Do you think that BTC is going back to $20k or to $100k? Then your risk doesn't change much from buying at $3500 VS $3200 does it?
How to make good buys? Their are pretty much 2 ways that I put my faith/risk in, and 1 of them you absolutely have to be there and have been there for a while.
The first is market momentum and you have to be there to see it and have been there to know what it looks like.
If you haven't stared at the books for 8 hours a day for the last week so you know what movement looks slow, average, or fast, then it will be hard to recognize momentum when you see it unless it is very obvious.
When you see the market move down faster than average then their is a good chance that the momentum of the movement will overshoot where it will settle.
So if it starts moving down fast watch closely. Watch for the downward movement starts to lose its speed, this is where the momentum carries it low, then when it is almost gone put your buy in right above the next big support wall, where the downward movement is likely to run out of steam.
That is how I "catch the falling knife".
It is the same really when you are trying to sell but upside down. Put your sell in where you think the upward movement is likely to reach but close to where you think it is going to stop.
This also does a lot to minimize risk because it gives you opportunity to get out.
If you buy right over that wall you didn't think it would go through, and then the market is beating down that wall, you can just sell back into the wall yourself right before it breaks and lose very little.
It is usually a good trade entry if you buy or sell just as a wall gets broken because then usually it will go for a run once the wall is down, to the next wall..
But you have to be there to see all of that and know what it looks like on that particular market..
The other way that you don't really have to be there for is to just place your orders infront of walls. Hail mary orders.
You look in the books, or depth chart, and put your orders right infront of other massive orders or areas thick with a lot of orders, because if a spike happens it is likely as far as the spike will reach.
It is easy for a spike to fly through areas of low resistance but much harder to move through areas of large support.
Price movement amount isn't really what matters, it's more about how much volume of orders can be gobbled up.
I think it is mostly wrong to say something like "XXcoin will move up/down 10%" as opposed to "XXcoin can eat 100BTC of orders in this direction"
If it is going to eat 100BTC of orders with its current volume/momentum, that could only be 1% if their is 100BTC of support before a 1% change, but if the books are light for some price movement distance and their is only 50BTC of resistance for a 10% change, and then 100BTC of resistance for the next 2% change, then you can conclude that the market is going to eat the 50BTC it takes to move 10% and then stop at 11% where it takes another 100BTC to get through.
So you want your order in at the bottom of the low resistance area to get the best price, but at the top of the high resistance area where it is likely to stop so your trade is likely to hit.
If you want to put in orders to buy BTC at a good price, increase your chances of getting a good price, then put your buy order(s) at the bottom of low resistance and above where the resistance gets high. Then you can check in the morning and see if your orders hit
One of my best hail mary orders that hit was on DRK.
It was like 55 something and I put my orders in to sleep at like 36 right above some massive support. And that shit hit! When I woke up it was like 48 something and I took my profits..
I put my order right in the same place to sleep that next day, and I'll be damned if it didn't hit again and was right back in its usual trading range for me to take my profit on it..
The other advantage is that I believe that you avoid paying a commission on coinbase if you are a market maker.
This is true and why I hate trading CB. it makes for virtually no spread and the maker bots are extremely aggressive and don't leave their orders sit very much at all.
If you want to buy on CB I think you be well served to look at the books on all of the highest volume exchanges where the resistance really is and is more likely to stay, and place your orders on CB accordingly. Not just the depth on CB but the depth of the whole market..
BTC trading is hard because it is split up in so many markets. I have seen where the massive support was on finex and the massive resistance was on stamp.
If you were only looking at finex you wouldn't understand why the price kept stalling where their was no resistance, but the resistance was on stamp and you would have to look there to see it and watch it finally break through so all of the exchanges could go up.
I don't really understand how the arbatrage bots work and make profit, but they are damn good at keeping all of the exchanges very close, and they don't necessarily show themselves in the books by simulating the support/resistance, they just act on the current price.. I think.
I've put down some volume on CB and decided I didn't like it because of the way the fee structure make the bots behave.
I really really really loved trading huobi with their 0% fee and optional leverage both ways, but those days are gone
