Bitcoinica Leverage | Bitcointalksearch.org

R-

full member

Activity: 238

Merit: 100

Pasta

Quote from: RaggedMonk on April 06, 2012, 07:00:38 PM

Quote from: Omni on April 01, 2012, 09:19:32 AM

I was thinking of depositing my funds in Bitconica and taking a leveraged position. The leverage I will use will be 1:10.

What are you high?

Quote from: Omni on April 01, 2012, 09:19:32 AM

I have roughly 1,000 BTC that I am not doing anything with. This was acquired in 3 days through means I will not mention on the forum (rhymes with milktoad).

Oh, probably...

Probably is. ~rep.

Jay_Pal

legendary

Activity: 1493

Merit: 1003

Quote from: Revalin on April 06, 2012, 04:39:08 PM

You should place a Limit at 5.1 and a Stop at 4.9.

The limit order will be filled whenever buyers bid more than 5.1. If there are only enough bids to take part of your order, only part will sell, but it will all be at 5.1. If you're dealing with small amounts it will generally get filled completely since the whole market can't go over 5.1 until your order is filled. In other words, your entire order will be filled at 5.1000 before the market hits 5.1001.

A Stop order means to liquidate immediately at market price. When the price is crashing no one will be buying at 4.9 - so it has to accept lower bids in order to finish liquidating. Trailing Stop works the same, except it automatically raises the liquidation price as the market rises. IE, the Stop price will be higher, but the immediate liquidation in a down market will still require selling under the Stop price.

Oh... I was placing trailing stops on the rising quite above the price... Dumb...
Thank you very much for making me understand my error!

RaggedMonk

sr. member

Activity: 308

Merit: 250

Quote from: Omni on April 01, 2012, 09:19:32 AM

I was thinking of depositing my funds in Bitconica and taking a leveraged position. The leverage I will use will be 1:10.

What are you high?

Quote from: Omni on April 01, 2012, 09:19:32 AM

I have roughly 1,000 BTC that I am not doing anything with. This was acquired in 3 days through means I will not mention on the forum (rhymes with milktoad).

Oh, probably...

Revalin

hero member

Activity: 728

Merit: 500

165YUuQUWhBz3d27iXKxRiazQnjEtJNG9g

You should place a Limit at 5.1 and a Stop at 4.9.

The limit order will be filled whenever buyers bid more than 5.1. If there are only enough bids to take part of your order, only part will sell, but it will all be at 5.1. If you're dealing with small amounts it will generally get filled completely since the whole market can't go over 5.1 until your order is filled. In other words, your entire order will be filled at 5.1000 before the market hits 5.1001.

A Stop order means to liquidate immediately at market price. When the price is crashing no one will be buying at 4.9 - so it has to accept lower bids in order to finish liquidating. Trailing Stop works the same, except it automatically raises the liquidation price as the market rises. IE, the Stop price will be higher, but the immediate liquidation in a down market will still require selling under the Stop price.

Jay_Pal

legendary

Activity: 1493

Merit: 1003

I'm sorry to crash in this post, but I also have some doubts on trading using Bitcoinicas interface.
I'm member for months on Bitcoinica, but I still couldn't figure out how do Limit, Stop and Trailing Stop orders work.
I've been banging my head to figure it out but with no success.
Let's suppose I have 0.05BTC that I bought for $5/BTC, hopping for them to raise their price.
Instead, they dropped to $4.9/BTC.
I wanted to sell them automatically when they reached, let's say, $5.1/BTC or higher.
What type of order should I put to accomplish this on its way up?
What about the other way around, if I was selling and BTC moving the way down?
Every time I tried to place a Trailing Stop, I never understood how or why it was executed way below the values I defined.

Omni

newbie

Activity: 42

Merit: 0

Quote from: Revalin on April 01, 2012, 11:10:37 AM

I don't use Bitcoinica, but you shouldn't have to convert first.

Don't forget: fees; you're paying the spread twice; and your 9k buy will move the market up and the ~9k sell will move it down cutting into your profit both times.

Also don't forget: if the market goes down $0.48 you will be forced to liquidate and lose 100%.

Ah okay thanks. Has anyone taken a high leveraged position before with btc recently?

Revalin

hero member

Activity: 728

Merit: 500

165YUuQUWhBz3d27iXKxRiazQnjEtJNG9g

I don't use Bitcoinica, but you shouldn't have to convert first.

Don't forget: fees; you're paying the spread twice; and your 9k buy will move the market up and the ~9k sell will move it down cutting into your profit both times.

Also don't forget: if the market goes down $0.48 you will be forced to liquidate and lose 100%.

Meni Rosenfeld

donator

Activity: 2058

Merit: 1054

Quote from: Omni on April 01, 2012, 10:55:27 AM

Does this look right?
1) I convert my 1000 BTC to $4,800 and buy BTC with leverage 1:10.
2) I can technically buy $48,000 of BTC... If the price of a BTC rises from $4.80 to $5.00 and I liquidate, I will have a total of $50,000 of USD. I pay back the original $43,200 I borrowed and pocket the $2,000.

Sounds about right, though I'm not sure step 1 is necessary.

Omni

newbie

Activity: 42

Merit: 0

Does this look right?
1) I convert my 1000 BTC to $4,800 and buy BTC with leverage 1:10.
2) I can technically buy $48,000 of BTC... If the price of a BTC rises from $4.80 to $5.00 and I liquidate, I will have a total of $50,000 of USD. I pay back the original $43,200 I borrowed and pocket the $2,000.

Revalin

hero member

Activity: 728

Merit: 500

165YUuQUWhBz3d27iXKxRiazQnjEtJNG9g

You are correct. Apparently I should read the material I cite.

Meni Rosenfeld

donator

Activity: 2058

Merit: 1054

Quote from: Revalin on April 01, 2012, 09:38:34 AM

Stop: Execute a market order when the price goes over a setpoint.
Trailing stop: Execute a market order when the price goes under a setpoint.

You didn't interpret investopedia correctly.

Stop: Either sell if the price is below a point, or buy if the price is above a point.
Trailing stop: Like stop, except the price is dynamic. If the current price is $5 and you put a trailing stop sell for $4, if the price goes up to $10 your new stop point will be $9 (or $8 if you defined it as a percentage). Likewise for buys.

DeaDTerra

donator

Activity: 1064

Merit: 1000

If you haven't done any speculation trading in the past I recommend to start with a small amount and learn first, there are also a lot of other investments that are not as risky which you could check out

//DeaDTerra

Revalin

hero member

Activity: 728

Merit: 500

165YUuQUWhBz3d27iXKxRiazQnjEtJNG9g

Market: buy/sell immediately at the current market rate. You pay the spread.
Limit: Offer to buy/sell at a price. When someone executes a complimentary market order that's better than your offer, your order is filled.
Stop: Execute a market order when the price crosses a setpoint.
Trailing stop: A stop order that follows the price.

http://www.investopedia.com/terms/m/marketorder.asp
http://www.investopedia.com/terms/l/limitorder.asp
http://www.investopedia.com/terms/s/stoporder.asp
http://www.investopedia.com/terms/t/trailingstop.asp

Options: http://polimedia.us/bitcoin/options.php

Don't start with 10:1 leverage. You'll lose your entire 1 KBTC faster than you earned it.

Omni

newbie

Activity: 42

Merit: 0

I have roughly 1,000 BTC that I am not doing anything with. This was acquired in 3 days through means I will not mention on the forum (rhymes with milktoad) For the reason that this sum took such a small amount of time accrue, I don't mind "gambling" with leverage.

I was thinking of depositing my funds in Bitconica and taking a leveraged position. The leverage I will use will be 1:10.

Before I start, I have a few questions:

What is the difference between the different types of orders:
> Market
> Limit
> Stop
> Trailing Stop
Are there call/put options?

Topic: Bitcoinica Leverage (Read 1948 times)