3.4BTC Giveaway, see @Pumper_ryan for details
Total return: 204%
Coins: CSD
Risk comes from not knowing what you’re doing.
In the altcoin market, risk is a matter of perception. One person may feel entirely comfortable with walking into what he perceives as a high potential trading situation, whilst another person may perceive the exact same scenario as one that is void of any opportunity whatsoever.
It all boils down to how much you understand about the way prices move.
You see, if a coin that is valued at $1 shoots up in value with its worth increasing to $2 – this is because the perception of 90% of market participants has been augmented.
CSD
Prices don’t change until commonly held perception changes.
It’s just like in the traditional world of commerce. Whenever GM has a major vehicle recall due to “faulty brakes” or the threat of “spontaneous combustion,” their share price plummets. This happens because the majority of people holding GM stock are now fearful that their holdings will become worthless due to the tainting of GM’s brand – so they begin to sell, and the price tumbles.
Then what happens?
Word begins to circulate around all the big brokerage firms and institutions “GM is getting cheap... BUY!...” Then accumulation occurs, prices begin to steadily correct – then the big media outlets begin to begin to broadcast positive news concerning the GM share price.. “It looks like GM is recovering, after losing 30% of value it seems to be bouncing back” ... Again, this causes market wide perception to change and people begin to buy back into GM in fear of missing out on cheap prices. This creates a voluminous rally that sends the price rocketing through the roof,
This is how the ‘perception’ of traders and investors is manipulated over and over again.
The same thing happens in the crypto markets.
This very month there are people who are buying back the very coins that they had sold last month because the coin was being labelled as “a scam.” The only difference is that, when they sold, the price was “at the bottom” – and now, whilst they are buying back in, the price is at “the top.” (See how it works now?)
The implication is, the manipulation or perception is to encourage uneducated traders into selling when they should be buying, and buying when they should be selling. That’s all
The manipulation of perception is just another method of trading the markets. This strategy works simply due to herd mentality.
You see, when the cry of “scam” is initiated and targeted at a certain coin, people WILL sell. Why? Because the single act of only one person selling causes the price of a coin to drop. Now what if 20 people sold? Or, 100 people? ...The price will crash so fast that you won’t even be able to rationalize how you will make your own exit.
This is why amateurs are jittery in the market – because they buy at all the wrong times and are therefore leaving themselves open to be exploited via the manipulation of perception.
The skilled trader who buys only at rock bottom prices doesn’t worry about the “dump it” cries. His ears are closed to the “scam coin” accusations – because when others begin to sell as a result of these tactics, they are selling to him! And weeks later, these same weak handed traders will be buying back these coins from the very people they sold them to - but this time at a severe price mark up.
To summarise; buying at the wrong time leaves you open to a variety of manipulation strategies that WILL be used against you. There is no doubt about it! I mean, the very act of buying at the wrong time is the result of yet another variation of manipulation – mass market deception.
To win is simple, you have to play the game the way it is supposed to be played.
Before you purchase into any coin, you want to be aware of its entire 'trading' history - notice I said 'trading' history, and not the history of the dev, or the history of the coin's ANN thread.. you want to be aware of the 'trading' history, because that shows market sentiment in $dollars and not lip service, false promises or FUD etc. The 'trading history' is the only thing that matters
To find this information, just click on the 'ALL' tab that appears at the top of the price chart of bittrex. You will be able to expand the view and reveal the complete price history of a coin from its launch, up until the present day
Now, this is what you have to look for when assessing the 'ALL' chart.
1. Recurring price movements (patterns)
These recurring movements come in several forms. You don't need to see them all, in fact if you spot just one of these recurring patterns, you can go ahead and start trading in alignment with it.
The patterns are:
Recurring % Declines
This is, bar none, the most important pattern, simply because prices must go down before they go up. So in simple terms, if you’re looking at a coin that has had several rallies (pumps) in the past (at least two) you want to wait until that coin has had a major price decline before you jump in.
If a coin goes down to its bottom price, the only thing that can happen from that point is that coin will now go up to a previous top, or a new top.
You can measure the % decline by finding the highest price that occurred during the last high volume rally (the peak price), and then working out the % difference between that price and the lowest price that has occurred since then. Typically, a 60% - 80% decline is optimal, a 90% - 95% decline is perfect.
Thats the basics
However, as I described in another post some coins repeat the same exact % declines again and again, which makes it very simple to spot the most optimal buying price
Recurring high volume rallies (Recurring pumps)
There is no point buying into a coin that doesn't have a history of high volume pumps (20btc and higher) - you can easily find out the volume of each pump a coin has had by looking at the volume bars in the 'ALL' chart.
A coin that has had several high volume rallies (at least 2) will always provide opportunities for a high probability trade.
There are patterns like these in every single coin that is on the market, this is why it is very essential that you look at the 'ALL' chart before you even think about trading a coin
The basic message is, you must always seek to purchase into each and every coin that is trading below value - so long as that coin is following an obvious pattern, and is being accumulated
When each of those coins begin to advance in price, you will already be positioned to profit - just like a retailer that stocks all of the right products at the right time
e.g if you walked into walmart in the middle of winter, you will find numerous 'summer items' selling at severe discounts. i.e 70% off cooling fans, 50% off sun lotion, half price ice-cream makers etc - whilst all the winter items will be selling at above value prices
Although supply and demand takes a different twist in crypto, that is the basis of how supply and demand works
This is the general mindset that you must have, in order to start to accumulate a string of profits in this market
SIDENOTE: You have to wait for optimal trading opportunities and resist the natural urge to trade more frequently. You must be willing to do nothing, absolutely nothing, until there is something to do. Personally, I just wait until there is money lying in the corner and all I have to do is to go over there and pick it up. In other words, until a trade is so obvious that it’s like picking money up off the floor – do nothing! Waiting for these ideal opportunities requires the patience to allow alot of non-optimal trades to pass by without participation. The message is: by avoiding non optimal trades, you will be able to increase your cumulative return tremendously – thus patience makes all the difference between a skilled and unskilled trader.
Note: BTC is a buy right now. Pay attention to the price and execute your buys at the low points.
Twitter: @Pumper_Ryan follow for daily picks, and updates.