TL;DR;
Making one trade per day, I’m trying to grow 0.01 worth of BTC by 5% per day for 365 days.
Today is the end of week two. (View last weeks blog)
I am down 3.6% from my starting amount of 0.009897, sitting at ~0.00954
I am up 7% from last week.
Track progress here.
Oh hai there
Can a monkey make better trades than humans? Apparently.
In recognition of the monkey’s superior trading abilities, this week I put my pride aside (especially after last week’s performance) and I tried to be as one with the monkey.
The results were good, making an overall profit of 7%..
While I didn’t hit my daily target of 5% growth per day, I did outperform 75% of the top 100 coins.
Methodology (not financial advice)
I put names of tokens in a hat and my girlfriend picked one out of the hat.
“How did you choose the tokens to put in the hat?” you ask. As I didn’t have much free time this week, and didn’t have a chance to research the trading recommendations from /r/CryptoCurrency (see below)… I used the following 3 methods:
- Using 1 hour / 8 hour /1 day Bollinger Bands as an indicator of a good buying time
- Looking for juicing buy walls to pin my buys next to
- The vibe/pick at random (sometimes I didn’t have time for options 1 and 2)
The two times I lost this week
On one of the days I was too busy to go through the method and picked a token myself. That was the first time I lost BTC last week.
The second time I lost, all of the options I put in the hat lost BTC value.
Not bad.
Feedback from /r/cryptocurrency
View all comments here.
“I always follow one simple strategy: never sell crypto at loss unless you planned your stoploss level. FUD is your worst enemy.
Though sometimes with this strategy I become an investor rather than trader ? and get my funds frozen in some alts for really long periods [..]Don’t let your fear of taking losses or your purchase price get in the way of more profitable trades.” – Grandifer
“FUD is your worst enemy […] Don’t let your fear of taking losses or your purchase price get in the way of more profitable trades.” This resonated the most. At one point this week, I was down 7.6% on one of my trades. There was a huge sell wall below my buying price and I decided to cancel some of my sell orders to see if I could minimise my loss, by placing a sell order just below the sell wall.
Later on in the night there was huge 20% spike (that lasted 15 minutes)… it executed all of my sell orders but I only made a marginal gain of 0.88% for the day.
Is there a lesson in this? Probably not. Just lucky to make anything, really. The majority of coins lost value this week and most gains were seen from random shizzle coins with low trading volumes.
Ultimately, although this experiment is low cost – the psychological impact of seeing any losses and markets moving against you is very real.
As for the rest of the notes, stoploss isn’t available to me and hodling isn’t an option in this experiment.
“All that aside, the point I’m trying to make is that past returns shouldn’t have any effect on your current portfolio choices. At any given point in time, you should be able to look at your holdings and go, “Yup, this is the best place my money could possible be right now”. Having a goal of “at least breakeven on any trade” is unrealistic and actually very dangerous. The moment you can click on that “sell” button, gains or losses, and not feel anything…that’s when you become a world-class trader.” – notextremelyhelpful (in a thread of comments from Grandifer)
An interesting perspective, especially “Having a goal of “at least breakeven on any trade” is unrealistic and actually very dangerous”. Though this is sort of where I’m at, just because of the goals/tactics I set in this experiment. Especially because I’m still not back to where I started after taking a loss of 13% in a day (Thanks DNA!), making breaking even (at a minimum) a very strong motivator.
Ironically, if I had held on to my biggest losing token (DNA) for a week more – I would be miles ahead of where I am now.
“big advice: choose very wisely who you listen too. Suppoman has a very bad reputation here, since he has a very shady history of possible scams and other stories that make him not seem very trustworthy.” – ResponsibleLaugh
Solid advice. I’m currently running my experiment on the Kucoin exchange. Not because it’s a world-class exchange, but because I listened to someone shilling Utrust (It actually could have been Suppoman) and that was the only place I could buy it. Long story short, I lost 50% of what I invested into it. However, I had just the right amount of BTC to start this experiment. So I kept the BTC on Kucoin to avoid transfer fees to larger a exchange.
Utrust may actually be a good project (I don’t know), but I didn’t do my own research – and lost. Thankfully, not too much.
Otherwise, my thoughts on Suppoman are; he’s good entertainment – but there’s a strong shill side to him, and a large enough audience to move markets (and make money – mainly for him).
“Can I suggest another experiment for you? Take 0.01 btc and lend it out on Poloniex for a year and see how you fair. Most days the lending rate is pretty low, but when there are alt pumps on it can go to 1% a day or more. At the very least you won’t lose money the way you can with trading.” – teatree
Had a look into it. I still don’t quite get how it’s relatively risk-free/you won’t lose money. But I might save this experiment for later.
“If you’re really trying to move up the distribution of profitable day traders (to at least the 5% range) then I’d suggest learning about the technical indicators beforehand 😉
[…]
If you really want to step your game up, look into volumetric analysis (the study of the price/volume relationship). Here’s a great resource: http://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:volume_by_price” – notextremelyhelpful
A good read. I couldn’t find this indicator in the indicators in the charts on Kucoin – but I’ll definitely try and read up on more technical indicators.
What’s the plan for week 3
Another busy week ahead… So I might stick to the winning formula for now (yes, picking tokens out of a hat).
I’m contemplating moving to a larger exchange (because every day I seem to be looking at the same 20 or so tokens that have some volume). But we’ll see.
Until next time, I wish you all nothing but green days.
Feedback
Feel free to provide your feedback on Reddit or send me your buy recommendations for the day @DennisGraham7