Crash!!

[ineededausername]

Back on topic!
I hate Bitcoinica spreads.  I shorted, the market went down, and I lost money.

[1713958960]

1713958960

[1713958960]

1713958960

[ElectricMucus]

Back on topic!
I hate Bitcoinica spreads.  I shorted, the market went down, and I lost money.

That's nothing.

I pretty much am beyond recuperation now, the only time I made a stop loss it gets filled and bounces right back.

I now believe the only way to really make money with bitcoinica is:

Constantly watch for reversal points.
Only place Limit orders, never do a single market order no matter what.

Only use stop orders once you are in positive p/l.

The bad thing is once you miss the train (miss the turning point) one time you are constantly running behind. So place a limit order so you just get your money back and start over. If you are using stop loss at this point you are guaranteed to loose money.


But that all doesn't help me I am down from 400+% to under 50%  
I was fairly successful until the 'manipulators' wall in such case you need to quickly switch sides if it goes against you not to loose money.

[RyNinDaCleM]

never do a single market order no matter what.

This is the devil!
I don't even mess with bitcoinica, but I have been burned on market orders. I avoid them at ALL costs. If the train rolls out and I miss it, I wait until it falls back. Too many times I played catch-up after jumping on even a little late. The only thing this doesn't protect from is if/when it goes up and never returns. At that point, I'll just take the small loss, and buy in when the dust settles.

[netrin]

Bitcoinica leverage does help when you're too heavy in either currency. If I'm on the right side of heavy, I try to make my trades on Mt. Gox and move assets over to Bitcoinica for the stops (although I'll admit stop loss has not yet helped me). I like that I can place progressively larger limit orders inverse to probability: short 1 at $2.8, 10 at $2.9, and short 100 at $3 (it's a sure way to lose your shirt when you're wrong).

But considering I expected a peak today at $2.9, I'm annoyed I could only sell at $2.8 on Bitcoinica. I think you need to be gambling for the 50% weekly movements. You can't day trade on Bitcoinica.

[phorensic]

But considering I expected a peak today at $2.9, I'm annoyed I could only sell at $2.8 on Bitcoinica. I think you need to be gambling for the 50% weekly movements. You can't day trade on Bitcoinica.

I've day traded for months on Gox and it became my personal style that I really was good at.  Trying to day trade at Bitcoinica is impossible.  The spread is too large, the swings lag too much, and the algorithm he uses is made to do that.  It forces you into this long period swing trader.  My first 5 trades at Bitcoinica I lost big.  Then I finally learned how to use it, but I could only make 1-2% positive trades here and there...but I could lose 15% in no time flat if I got impatient and liquidated in order to switch positions for the next reversal.  I'm still using Bitcoinica, but it's like grinding teeth.  I don't even use leverage!  He really has to tighten up the spread by tweaking his algorithm.  He keeps blaming it on volume, something to the effect of "If more people use Bitcoinica the spread will narrow".  An yet he is #2 in volume already.  Forex brokers advertise 10 pips spread...it's common to see 1,000 pip spreads on Bitcoinica.

[ineededausername]

But considering I expected a peak today at $2.9, I'm annoyed I could only sell at $2.8 on Bitcoinica. I think you need to be gambling for the 50% weekly movements. You can't day trade on Bitcoinica.

I've day traded for months on Gox and it became my personal style that I really was good at.  Trying to day trade at Bitcoinica is impossible.  The spread is too large, the swings lag too much, and the algorithm he uses is made to do that.  It forces you into this long period swing trader.  My first 5 trades at Bitcoinica I lost big.  Then I finally learned how to use it, but I could only make 1-2% positive trades here and there...but I could lose 15% in no time flat if I got impatient and liquidated in order to switch positions for the next reversal.  I'm still using Bitcoinica, but it's like grinding teeth.  I don't even use leverage!  He really has to tighten up the spread by tweaking his algorithm.  He keeps blaming it on volume, something to the effect of "If more people use Bitcoinica the spread will narrow".  An yet he is #2 in volume already.  Forex brokers advertise 10 pips spread...it's common to see 1,000 pip spreads on Bitcoinica.

I really don't know why you're using Bitcoinica without leverage. What's the point?!?!  If you were doing well before and you aren't on Bitcoinica, then surely you should move back to Gox.

[phorensic]

I was working my way up from 1 BTC trades to half my balance and then start using 2.5:1 leverage.  I'm very conservative.

[caston]

I definitely agree that the spreads should be improved. The lag is a very interesting point. E.g. when prices fall or rise the spread is way out in Bitcoinicas favor and takes a while for it to catch up. Sometimes the market may have swung back before the spread went in your favour again or it was only in your favor for a brief few seconds.


Maybe someone could make a alternate bucketshop? Maybe test it out on LTC first. Would be interesting if we could get better spreads with LTC even with much less volume.

[ElectricMucus]

Spreads are dependent upon mtgox orders, and in some cases they are even negative.
The trick is to long into sell orders supposed to suppress the price which you think will fail and short into orders supposed to pump the price.

The problem though is you must 'know' that it will fail because if it succeeds you're screwed. This tactic get harder and harder the more money you have because there will be less coins or dollar available. Also your opponents you play against will become more and more powerful.

Another successful tactic is 'calling the top/bottom' and is the only time a market order is actually useful. That is during a low volatility period make the biggest market order you can and hope others jump on.

Once they do quickly liquidate. This only works with 1000+ coins though and is very risky. Because if they don't you loose badly.

[speeder]

I now became in bitcoinica a weekly trader.

Also I greatly diminished my leverage, sometimes I use 1:1 for a while until a position go "against" me, but with 1:1 instead of that position auto-liquidating, I use my remaing spread to to improve my position for the direction I want (in hope of course, that the move against me was temporary and that it will reverse).

I am gaining money now, but I still have 2000 USD to get back all that I lost learning bitcoinica. And there are no guarantees that I won't do new shit and lose more 2000 :/

[molecular]

I now became in bitcoinica a weekly trader.

I still don't quite understand bitcoinica.

I only ever have 1 position. any additional buy/sell will adjust that position (base price and amount change). Are positions always unified into one position?

[ElectricMucus]

I now became in bitcoinica a weekly trader.

I still don't quite understand bitcoinica.

I only ever have 1 position. any additional buy/sell will adjust that position (base price and amount change). Are positions always unified into one position?

Yes, you only ever have one position, if you sell and are long you are liquidating and verse visa, until you reach zero after which point you go in the other direction. So in theory it is possible to trade even double your margin. (Highly risky but can be effective if you have sufficient power for the moment to kickstart a market movement.)

The base price is based upon all your orders you made based sum of prices/blocks of 50 btc.

[molecular]

I now became in bitcoinica a weekly trader.

I still don't quite understand bitcoinica.

I only ever have 1 position. any additional buy/sell will adjust that position (base price and amount change). Are positions always unified into one position?

Yes, you only ever have one position, if you sell and are long you are liquidating and verse visa, until you reach zero after which point you go in the other direction. So in theory it is possible to trade even double your margin. (Highly risky but can be effective if you have sufficient power for the moment to kickstart a market movement.)

The base price is based upon all your orders you made based sum of prices/blocks of 50 btc.

"blocks of 50 BTC"??

[ElectricMucus]

Yes bitcoinica has guaranteed liquidity of upto 50 BTC. The price you see is for anything <= 50 BTC, if you trade more with a market order there is a few seconds delay in which the price is able to change (usually against you).

[phorensic]

Yes your "positions" are unified into one position.  This is frustrating for me because I could swear when I was using Oanda I could have multiple positions, so I could see my stair step trades without have to look back at my order history.

[N12]

All we can do is keep building services and shops.  People will come around when they consistenly hear about positive improvement in our economy without bad news to temper it.  We fucked ourselves letting it spike like we did and the only choice now is patience.

Do you even know what an economy is? Also, the most high volume business Bitcoin has is most likely Silk Road. Why? Because they it offers them an advantage.

"Building services and shops" is completely useless as long as Bitcoin only serves as a middleman as in in USD => BTC => USD.

This creates useless overhead and makes no sense. If the businesses decided to use a certain percentage of BTC funds to pay expenses, however, it would be a different story.

[netrin]

"Building services and shops" is completely useless as long as Bitcoin only serves as a middleman as in in USD => BTC => USD.

It might be inefficient, but not useless. Bitcoin provides advantages as a middleman between far more currencies than you've mentioned. As one example, bitcoin offers most of the advantages of paypal, lacks many of the disadvantages, and offers unique advantages of its own. My only complaint about bitcoin really, is that so few people use them today. I suspect that will soon change.

Perhaps you mean that bitcoin-exclusive shops make no sense if it's only a conversion/transmission protocol? Maybe but I'm not so sure of your abundant use of absolutes: 'completely useless', 'only', 'no sense'...

[caston]

One thing in bitcoinica's favour though is that there are no fees. I signed up with a CFD trader so I could make money shorting other tradables while bitcoin is flat and I did well today on a short position, however, I noticed that if I cash out I still lose on the entry and exit fee unless I'm willing to risk a larger amount on each trade.

*edit: Actually I did make about $8 which is pretty good for risking $50 but I am on the intro rate. Once I graduate to the full rate that profit would have been wiped twice over. That is why I will look for long term slopes to ride.

[netrin]

Even with perfect trades, I do not believe it would have been possible to have gained on any two bitcoinica orders in the past 24 hours.

[caston]

Even with perfect trades, I do not believe it would have been possible to have gained on any two bitcoinica orders in the past 24 hours.

I almost made $4 but the market moved against me when I went to liquidate. But I do remember I could have made more if I had of bought around $2.60