re: Official CryptoTalk Thread

When it's all said and done, I'll drive down and we can hit up Nola Motorsports for a track day

I hate making anything resembling a “call” but I can’t help but think Fridays bottom might have been the start of the 2024-2025 bull market.

I’m thinking the next fed meeting needs to come and go before we see a definitive move.

Everything is set up correctly for the run to begin from what I can see. Alts are at a weak point vs. btc which means there is capital on the sideline waiting.

Compare now to a few months ago when many alts were almost double their current value and BTC was above 65k.

I guess ppl didn't like my analysis of Trump not doing great last night

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very limited catalysts on the horizon.

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Think we had a couple show up today. Saylor bought 18.3K coins in the last 6 weeks and the US deficit in August was a shite show.

Feeling frisky today. Added some more to my Matic balance.

Overall, the crypto market is looking somewhat okay today. If, and a big if, things pan out how they're looking right now, we'd close the daily above some minor resistance points.

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How long do you typically have a trade open? I bought at 57.5 a few days ago so I’ve been holding since

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Just curious if you reversed your trade today (from BITX back to BITO). When you asked this question 8 days ago, Bitcoin had pulled back to $54K. We both had opened a trade at approx. $57.5K, and then Bitcoin tanked to $54K, so we were both sitting at a loss if we would have panicked like some people will do that don't have ice in their veins and conviction that Bitcoin always recovers. So today, 8 days later Bitcoin went above the $58.5K trigger point to reverse the trade. By the time I noticed it and opened Fidelity to reverse my trade Bitcoin was roughly at $59.5K and I reversed my trade so I added 1.7% more BITO shares to the amount of my trade.

This is typical for what I might average. So if I do this trade successfully 10 times a month, I would make a 17% dividend for the month that I create myself by just taking advantage of Bitcoin volatility using simple price based rules and price trigger points. I have done better than 17% on some months this year and sometimes worse, but I have significantly increased my shares this year using my strategy and no new funds.

Now that I have switched to reinvesting dividends (in addition to my Bitcoin volatility arbitrage trades) I should be adding BITO shares at a crazy high rate. I was taking the dividends in cash all year and still growing shares at a good clip, and just switched to reinvest dividends for this last distribution.

That's awesome. Glad this is working well for you too. I'm ready for Bitcoin to go parabolic or at least get on a good trend upward, and of course maintain good volatility on the way up.

The strategy works no matter where Bitcoin's price levels are. Bitcoin could jump to $70K, $100K or higher, and I will still be looking for volatility to open trades on pullbacks.

The difference in an upward Bitcoin price trend with volatility is that you will open and close trades much quicker and have more of them, creating shares at a faster rate. You will still create more shares in Bitcoin sideways and downward trending price action but you open and close fewer trades and it can be irritating because you have to wait longer for some of your trades to reach their reversal trigger point prices. Even then, it's better to create more shares at no cost than to just be disappointed that Bitcoin is stagnant or dropping in price.

You should just post for the rest of us that want to try your system when you're going to make a trade, and what the trade is. Obviously make your trade prior to posting.

I would really appreciate that as I'd just follow your trades in small dollar amounts until I figured out what exactly you're doing.

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You should just post for the rest of us that want to try your system when you're going to make a trade, and what the trade is. Obviously make your trade prior to posting.

I would really appreciate that as I'd just follow your trades in small dollar amounts until I figured out what exactly you're doing.

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Sure, I can do that for some amount of time so you get a feel for the strategy. As a disclaimer, this is a risky trade and there is always the possibility that anyone trying this loses money. The biggest risks are that Bitcoin drops very significantly, it doesn't recover from losses or someone trys this method and they can't risk losing the money they are using for this strategy and/or they don't have ice in their veins when they need to.

Just a quick recap of the strategy that I use. First, you need to develop a sense of perception of what Bitcoin is currently trading for on average. Bitcoiin in my mind is currently trading at about $60K right now for the last several days. If Bitcoin were to jump to $62K in 1 hour and then almost immediately fall back to $60K, I would still perceive that Bitcoin is trading at about $60K.

When I perceive that Bitcoin drops $1K or more in price, I sell about 5% of my BITO and immediately buy BITX with those funds. Then when Bitcoin rises back $1K or more above its price when I opened the trade, I reverse that trade. I consider these two trades a set where I open a new trade (BITO to BITX) and then close the trade (reverse the trade from BITX to BITO). If Bitcoin continues to fall after I open a trade, I will initiate new sets of trades following my same rule, and each open trade will have its own reversal price point trigger where I close that trade.

So as an example, I currently perceive Bitcoin is trading at approx. $60K. So tomorrow, if I see Bitcoin drop below $59K and I am available to make a trade, I will open a new trade. So let's just say that happens and Bitcoin is at $58.3K and I open a trade. That particular trade will then have a reversal trigger point price set at $59.3K or higher. Once I notice Bitcoin rise above $59.3K or higher and I am available to trade, I will close/reverse that particular trade by selling all of the BITX that I bought at $58.3K and immediately use those funds to buy BITO shares. I'll end up with more BITO shares than when I opened the initial trade.

Sometimes I can open and close trades in the same day, while sometimes it can take weeks. It all depends on Bitcoin's price swings and when Bitcoin rises above reversal trigger point prices. You can basically day trade in your accounts if you have them set up as margin accounts, or if not you trade within the amount of settled cash that you have in any particular account. Theoretically, if you buy BITX only with the settled cash in your account, if Bitcoin immediately rose, say over $1K just seconds later and that is above the reversal trigger point price, then you could immediately reverse the trade. You could theoretically make multiple trade sets in the same day, day trading so to speak, if Bitcoin just kept swinging up and down in large enough amounts all day and you have a margin account or plenty of settled cash and you are available to make the trades. If you don't understand settled cash or margin accounts, your broker (like Fidelity or whoever your accounts are with) can help explain that and convert or set up a margin account and/or tell you how to monitor your settled cash, assuming you maintain a good bit of cash in your accounts.

Also note that in the event Bitcoin just keeps falling, I do continue to open more trade sets at $1K intervals or more below my last trade set. However, once I reach selling 25% of my total BITO, I personally just stop opening new trade sets. I will make sure that 75% of my BITO is not sold at any given time and I will just wait until Bitcoin starts recovering and I can at least close one of my trades.

Also there are plenty of times that I miss the opportunity to open or close trade sets because I am busy and either not paying attention or I'm working, driving, playing, visiting, etc and I am just not available to do any trading even though I might notice that I could be making a trade.

One other thing. BITO's ex-dividend date is near the end of every month. I at least hope that all of my monthly trades are closed before the ex-dividend date. I sometimes (twice this year to date) will close out any remaining stuck open trade even at a loss, as long as I have closed plenty of successful trades so overall I gained a decent amount of new BITO shares with this strategy even taking a loss on one trade. I will do this because I am addicted to BITO's dividend, plus in one instance, I closed out a trade that was waiting on an approximate $73K reversal. I would still be waiting on that recovery price today and that particular trade would keep getting worse as BITX does experience some small amount of futures decay over time. So it's not bad to close out a trade occasionally at a loss if the rest of the month more than makes up for it.

EDIT: I just noticed Buck Rogers replied and did a much better concise job of explaining the strategy. You can read my reply above with more details of the strategy and an example. Also, feel free to adjust the strategy as fits your risk profile and your experience with it. I initially was waiting on $5K pullbacks. I learned I would do better on lower and lower pullbacks.