Hey everyone!
Without getting much into who and where, I just wanted to lay out some of my own thoughts on these kind of activities on the platform and my doubts about them.
I am not new to trading. I've never traded stocks or invested in them, I mainly started trading when I was introduced to cryotocurrencies. There were a few years where I traded some coins back and forth with the goal of increasing the amount I have, it felt like I had an edge over the market cause I was always trading knowing these coins would in the end go nowhere but up. At least as an altcoin enthusiast I felt like I had an edge over the market because my thought process was to always buy more on the dips and sell less on the highs.
There are things though that a human trader can not predict or execute properly in time. It's no surprise that exchanges and their API's are filled with trading bots, they are after all taking over wallstreet and other markets as well. Even though the crypto markets are a lot more volatile and crazy, bots will outdo human activity 99 times out of 100. If you believe you can do better you'll be as disappointed as World Chess Champion Garry Kasparov who lost his first ever match versus a computer in 1997.
After coming to the realization that I often ended up with either the same amount of coins or less than I had started with, even worse - less than if I had just mined them on my 2 GPU's at the time instead of spending many sleepless and stressful months trading. I decided to go for the long-term approach in trading and investing and it has by far been the best decision I ever did, both for my health, sleep and for my crypto holdings. I am not saying it is impossible, but I found that the more often you trade the bigger the odds are of you losing, especially on exchanges that take a hefty trading fee per executed trade (Bittrex and Poloniex usually take 0.2%-0.25% per trade).
Shameless self-promotion to use Binance instead which has a lower trading fee (0.05%). The link has my referral which I would appreciate if you used.
Now comes my thoughts on having a Steemit account where you announce currencies you believe will shoot up combined with having a huge following both on Steemit and on other social media platforms.
If some of you have been here longer, you might remember my attempt at this on my account @cryptochannel which is now discontinued. I want to also provide some details on my decision to discontinue that activity because it is related to my issues with this.
There is a lot of room for abuse with this activity. There's been a lot of discussion about technical analysis, elliot waves, etc, etc. But as a matter of fact we all realize that this technology and way of trading is something we may have never seen before. It's nothing compared to stock markets where most exchanges will only let you trade at certain hours of the day, or where most users are verified and only certain parts in the world are active trading, etc. Cryptocurrencies are worldwide. It is impossible to predict who is acting on what and when as there are so many different aspects in it. Big hands coming into a market, big hands leaving, big hands manipulating the price, bigger hands destroying the manipulation. Digital thefts being dumped on markets, unstable exchanges causing flash crashes or whales manipulating margin traders liquidation. There are so many possibilities and reasons to markets moving and from so many different people and regions, not to mention news and other events. There are too many to count, but when we are in a bull market and new investors coming in who don't even take the time to look into what they are buying it becomes a lot more of a gamble - the prime example being what some investors out there are currently doing with Steem back Dollars which are supposed to be pegged at a dollar each.
I realized quick on my cryptochannel account that if I continue to grow and build a following, especially when the time came that we would hit the next bull market, one that happened in early 2017 and the other recently, I would not only be able to predict a lot of currencies correctly and make it seem like I am good at what I do, but with the right amount of followers and people blindly following my trades I would also be a reason to the movements. It's not rocket science that if you are receiving 2-4k views per article signaling this and that coin is going to go up short-term next, that a lot of traders will follow suite cause they believe you have been correct about many other coins in the past. They may not even realize that 80% of the other unmentioned coins have done the same thing due to the bull market and new investors just throwing money at anything that's been around for longer than a few months and has a working blockchain.
I want to mention that my posts offered content about the coins, not just a graph that said it has done this and that and now I believe it will do this and that. Even if that might have been a bit overrewarded, it wasn't just short posts.
Now imagine yourself in my shoes if that account had received a lot of followers or if I were to resteem it on my account. Knowing that my next "prediction" might cause the price to jump up 5%-100%, would you resist on buying that coin for yourself prior to announcing it? Knowing that no one will be able to know if you've done it or not due to the anonymity of exchanges, would you be able to resist accumulate a random coin that hasn't moved for a long time and then feed it to your fanbase?
I am not saying that anyone actively does it, but considering human nature it wouldn't surprise me if some of that is involved. The trading fees are often so low as well that some big traders could be accumulating first, waiting for a "signal" and then buying up the start of it by a lot leading to the rest of the fanbase only purchasing what the initial buyers are now selling at a premium and profit.
As I was realizing that problem, I came up with a sort of "proof of holding" on that account where each time I wrote about a new currency I believed had potential in the future to gain value, I would at the same time add a screenshot or video recording of the exchange and showing my trade order history that I haven't dumped the currencies on my followers. This of course is also not a fail safe way cause I could've just created another account where I did much bigger trades with the coins instead and had the other one as a placeholder. I couldn't come up with a good solution on how to make it impossible to game my own followers, so I quit.
Even if you are amazing at predicting and wanting to share it with many people, there's no safety that you aren't getting a much better deal off of users in private and the people you say you are helping make a big profit in reality are the ones causing the upswings combined with the rest of traders jumping on top of rising coins and often ending with less than they had in the beginning. Since this all comes down to a gamble in the end if you are looking for quick profits, remember that many gamblers often forget about losses and only remember the winnings.
Be careful out there Steemians, slow and steady wins the race.
That is a wonderul analysis. You said so many things without saying them and you outlined so many things that others might be afraid to say so..
You are right.. anyone with a huge following can now make a coin go up or down with their "expert analysis" and can make money hand over fist by buying those coins prior to announcing that they are going to go upward..
Sadly, since cryptos are still not regulated currencies so the laws of SEC do not apply, hence this criminal activity cannot be stopped..
The only thing we can do is stay safe and play safe in crypto world..
Yeah, I think at the end of the day you just have to hope the appreciation of value in the technology over the long term is going to be such that manipulation ends up being blips on the radar, and eventually I believe it will. The people who really lose out on these types of activity are the people who are trying to make big short term gains. For the long term holders, this type of activity ends up evening out over the long term. It is definitely scary watching your portfolio valuation jump all over the place.
Yes, regulation can stop a lot of unqualified financial advisors - just like those pump groups/channels/tweets etc...
But - as I have written in another comment (sorry for copy-and-paste of this 5 lines list..) we are trying to analyze a market featured by:
Prices are ruled, even more than in traditional and regulated markets, by psychologycal factors. so, as you perfectly said, "anyone with a huge following can now make a coin go up or down with their expert analysis". In traditional and regulated market, volatility is controlled also by two other factors:
In traditional market volumes are controlled by with hyper-tecnologic actors like High Frequency Traders https://www.investopedia.com/terms/h/high-frequency-trading.asp that can destroy markets for fractions of seconds but don't create a panic sell/panic buy (too fast, they only kill stop loss users). And in every case regulators - unless, as everytime happens, they are colluded - have the tecnologycal analysis tools and the lawful attributions to interview.
So yes, by this point of view we need of a stron regulation. Think also to all scammed users that now have left the market because there were no law and none kind of legal guarantee..
You have a very interesting point of view in this post. There has been some rumors of Elon Musk is Satoshi Nakamoto. And I personal know many of his fan who will buy BTC if he is the inventor of BTC.
With great power comes great responsibility ;)
What do you think about what's going on with John Mcafee and his twitter announcements? Currently, he is able to basically manipulate any currency he wants to a large degree. His announcements send whatever currency he's mentioning to the moon...
Haha yeah it's kind of ridiculous, someone made a trading bot for it. xD
who is the man who made an trading for it ?
Greetings from COIN MAN...
I have some "Must Read Posts" waiting
for you to Review and Comment on...
@pocketechange
He is the HFT of the cryto world ;)
Great post. I have been trading for some time and it is all about psychology, patience and probabilities. It is also very important that you manage your risk, otherwise is game over. I agree whit long term approach in trading and investing. I went form day to swing trader and it was the right decision. My 2 cent advice : FOLLOW THE MONEY- "big boys"
Indeed thats a big part of the game. You have to learn How the smart money think, and follow It.
Unless you have enough money/influence to move the market itself
Wow. Thanks for sharing. With record numbers of people now trading the stock markets online and technology making it easier for them to do so, it's hardly surprising that the amount of people losing their hard earned savings has risen substantially too.
When you consider that the majority of people entering the markets for the first time have little or no market knowledge, or any kind of trading strategy, this really isn't a surprise.
With a lot of traders just after quick returns and almost treating the markets as some kind of an atm machine, or global casino, the potential for losses of a sizable nature is higher than ever.
We will surely be careful
You made serious points here. I really like it.
I believe when investing or trading, timing is everything. The right decision at the right time is what makes investing a profitable proposition. Timing your decision too late could be expensive – whether you plan to buy or sell shares. Timing it too soon, could mean that you do not get the best value from your investment. Several people invest their money hoping to reap dividends. However, not all of them generate the profits that they dream of. This is because not every investor spends time in doing the necessary due diligence before purchasing. Thanks for sharing @acidyo
This is why I appreciate you and some other people on the platform who will give their ideas, but never want to use people. Integrity is super scarce these days.
It's a rollercoaster, I stay away from that, I just set long term goals and I hodl and it paid off so far
Binance is by far the best exchange right now.
I think so too, loving the daytrading there so far and the new coins that get added on there first.
Yes, absolutely. They are adding every successful ICO.
Is there much difference between doing that, and upvoting a post just before resteeming it to 10,000 followers?
You mean for curation rewards? Yeah I guess it's a bit similar if you are in it for maximizing curation rewards.
Yeh it's a similar idea really, I personally don't have any problem with that as long as it's a genuinely good post/coin to invest in
I have been an active trader in stock market for last 10 plus years. I have learnt over the years that always follow the big money and get out as soon as they get out or else you will be burnt.
I agree with you more or less. It's best not to actively trade unless you either have a lot of experience, a lot of money (and can manipulate the market) or some kind of insider information. Buying into legit projects and holding long term is the best strategy for 99% of people. Trading on the side with a smaller amount is fine as long as you accept that there's a strong possibility of losing it.
Now that you mentioned it, I am reminded on how I would have had at least over $200,000 more if I had just "hodled". But nooo, I had to be Mr. Know it all and trade...
I think the only time it is beneficial to trade is when you have millions of dollars and you can actually manipulate the market when you start trading. If you think about it, that's very immoral but I don't want to get off topic.
Speaking of people that have followers, John McAfee is moving the market like crazy with his tweets :D
patience is really the key - and filtering out the solid projects.
Great thoughts..The right mindset is needed when you decide to become a stock investor/trader. One should really learn the basics and the ins and outs of investing in stock market. This is a good advice for those who would want to go into stock market investments. Risks will always be there so stay focused on the goal to become successful in this venture.
Slowly long and easy. Thanks for your always valuable posts
Please shine some light on which altcoins you're investing in for the long term
THIS. IS. A. GEM. OF. AN. ARTICLE. 💎 @acidyo
I usually put out long comments, especially when the quality of the content is high. I start sharing my thoughts, or just develop on the subject, but this time around, the above statement is a condensed version.
Thank you! Resteemed the crap out of it! Great to have it on my blog.
Thank you sir for your great article.I am also new in crypto-currency trading and I have invested my money in some of future alt coins of 2018 which can give profit.I have joined bittrex for trading,yes as you said true that bittrex is charging more fees.But it is very difficult to predict which coin will give you profit.I am scared also of getting loss,but I am ready for that I just want to learn trading for future profit.Thanks for sharing your thoughts and experience and I have also joined binance.com using your referral Great post sir.Upvoted and resteemed.
yes sir. I agree with you. I think also that slow and steady wins the race. At first I thought how can I grow it hurriedly. But by reading your post now I realized slow forward is good. Thank you sir for sharing wonderful and informative post.
Very interesting post. I wanted to point out one thing that I am observing in these weeks while i try to analyze markets: that in this world featured by
Traditional methods based on fundamental analysis fall. So pump groups/tweets/posts/articles are the main factor for moving and/or analyzing the market, because there isn't a fundamental value that can be taken as a reference for the entire market. You can predict future price... only basing on past price, because in this market psychology is all.
So yes, having a great follower base is a great responsibility. you have to consider that 1) you speak to traders that, just like you, don't have enought information to calculate what is the precise market situation (because of the lack of transparency) 2) you can create a big movement.. because psychology is all.
PS: Also because of these factor maybe technical analysis (that analyzes only price) can be considered as an interesting analysis tool.. Combined of course with more analysis (for example correlation between different cryptos and between altcoin and bitcoin). I study economy at univerisity and i can say - basing on scientific literature - that in efficient markets technical analysis is bullshit. But here, in crypto, maybe it can be useful if combined with other analysis tools
Haven't darts and monkeys been shown to out-perform the best trading firms?
Trading doesn't work.
HODL works.
And saves time.
Slow and steady i really agree. There is no reason, if you are new to the markets, that you can't start off with a small account and build it into a larger one over time. Your losses will be smaller and easier to manage psychologically as well as financially, and believe me...you will have losses.
The most common mistake I see, with traders new to the markets, is that they start with a small account and then have the quick easy money mentality. This thinking attracts a lot of players to the markets, but of course anyone who has traded for a while knows that there is no easy fast track to riches unless you are extremely lucky.
It's hardly surprising then that it is this type of trader that ends up getting totally worked over by the markets, struggles and continually fails to make any money.
I learned my lesson trying to beat the markets several years back when I was trading options. I would have my great weeks where I would go up a couple thousand, but inevitably would have weeks where my losses outpaced my gains.
Part of the reason was I would get FOMO and start to chase runs, bought into way too many highs just because I felt like I would be missing out if I didn't buy. Ever since I switched to only buying something I believe in and moving my profit horizon out several years I have been happier and much more profitable. It's a hard lesson to learn without experiencing though. Few people have the patience and self control without having been burnt in the past.
FOMO is a bad thing for the trader, doesnt matter what some people say about It.
There is tons of opportunity in the market every day, and missing some of them If no problem.
Yep, when I learned that lesson. I instantly became a better trader.
I started to study and learn about Financial markets in general around 6 months ago, and one of the things you mostly see around while googling is the announcement that there is easy money to be made with their miraculous signals/strategies.
I am still not a profitable trader, but i know one thing for sure: the miraculous surefire signals/strategy is pure bullshit.
The good traders i met said that It takes around 2 years of dedication in general to actually starting to make a sustainable profit.
It is a Very complex game, with a lot of variables and players with different interests in It.
And cryptos are a totally New part of the game. Some fundaments of Trading still apply, but It have a lot of different characteristics from the old markets.
In the endereço there is only one good way to become a sucessful trader: learn and find what technic suits better for you.
Everything Else is pure bullshit.
Really great post i must say.
Investing is a great way to derive the optimal value from your money. However, unless you’re investing in an index, you will need to pay close attention to the ebbs and flows of the market. In addition, you will also need to identify and monitor the stocks that seem like worthwhile investments. Therefore, do your homework, before investing your hard-earned cash in the market. You won’t complain when the stock prices rise. However, if they drop, you could end up losing all that you had invested in it. So @acidyo your points are very great. Its a must look out for.
This is really engaging and educating, glad you shared.
Really true and i urge us to adhere to them. The best piece of advice I could tell anyone who is new to the markets is to understand that "The trend is your friend". To ignore this is like attempting to swim against the tide. It's Hard work, frustrating, and you will increase your chances of failure.
If we can identify the trend direction (and it's always best to look to a larger time frame), then we can confidently buy the pullbacks or sell the spikes as they occur within the trend.
For example, if we were trading to the long side then we would look to buy at or near support levels or at the lower edges of the trend channels. It is at these places within an uptrend that the risk to reward ratios are most favorable. The opposite of course is true for those wanting to short sell.
Hopefully you can see from this, the importance of trading in harmony with the direction of the main underlying trend. keep up the good work @acidyo
Every short term investor learns this the Hard way.
Always the Long Time traders most the most profit.
Pick a coin that has maximum probability to scale up and invest.
You won't regret.
Take my Advice!
Not really. The good short term trades can get returns a lot bigger than long term.
But there is harder and have a lot more risk involved.
And you need a lot more guts.
After reading through, the above was what interest me the most and I can attest to it.
When you gamble and keep loosing, the day you finally nail one or win, it feels like all your past loss is immediately forgotten thus given you the idea, that this might just be your luck day and thereby gambling again and continuous hoping to win once more.
Thanks for bringing the above up
Thats why you need to log your trade operation.
So the take home message is invest and not trade because you are much less likely to lose if you invest, right?
Right. Invest the rest of you time in your self and your work. This is much more profitable than the risky (and time consuming) trading. And much more healthy ;-)
No. The message is If you want to trade, learn to trade. For real, not following miraculous tips.
The world of cryptomoney trading will be occupied by the technology of self-learning algorithms. It's inevitable.
It is worth remembering Turkle's Law: Every technology has an instrumental side, what the technology does for us and a subjective side, what the technology does to us, to our ways of seeing the world, including to our ways of thinking about ourselves.
This is a very thoughtful and well-written article. There is a lot to consider. The point about this being an unpredictable global market, and something we have never seen before, seems particularly important. My only cryptocurrency investment so far has been in the form of time, content and curation on Steemit. It feels fairly cautious and low-risk, especially compared to chasing profits in the bitcoin market. If you write a post comparing several crytocurrency strategies on the spectrum from cautious to risky, I would love to read it.
This is the first triple A I encountered on Steemit: absolutely amazing article! Perfect timing as well! Definitely the best article I've read on Steemit so far.
So it call trading. Not pyramid skim. Just stay and learn. Follow and upvoted you. Thanks for sharing such a good post
So much useful information coming from you, sir @acidyo. :) Thank you! :)
I just want to ask if Binance works like bittrex or not coz you're right bittrex's trading fee is high especially for steemians like me. :3
thanx you for information
... Know when to hold them, know when to e-sold them ...
But Fomo and greed wins over your soul and you buy high and then sell low :(
I respect your honesty and way of thinking, man!
That's not so bad to remind yourself about all this trading things time after time.
Trade what you can lose and the best thing to always do is Hodl for the long-term..!!
I am a newbie from Uganda,but I have learned to invest what you can lose and have a long term view ie Hodl....
Thanks for your honesty in this post.
I totally agree with you on slow and steady wins the race and I'm here for the long run while I am enjoying myself.
I and my husband are new to cryptocurrencies, but we have been in the stock market for a while now which I guess is helping us to understand the cryptocurrencies a little bit more.
Great post @acidyo
@acidyo Thank you for the heads up and your honest effort to inform and raise awareness on trading. Considering the amount of new users interested in crypto and Steemit, too many folks in here need support and precious advice so your post regarding this is greatly appreciated! I always advise people to HODL cause the whole crypto thing is still at its infancy stage from my point of view! Altcoins are going to explode next year! Cheers
It's good to see that you had you had started with criptocurrencies and I understand that treading make us loose because in my earlier stage I had also lost lots of amount so now I am invester not A treader. And its very true that it's not easy to find the market move, treading not suits for me at all. I just believe in investment. And good that you are right . As you had explained the price movements and the factor that impose effect. And its good to know is that you do share with the followers. I know earlier I was a gambler but not get profit. But now with investment I am in profit.
I think we all know who we are talking about here. And it is indeed somewhat like the blind leading the blind, this is VERY similar to what John MacAfee is doing right now as well. He knows he has a community backing, and lets just say that we have 8000 followers, all with $5000 ready at the helm. thats $4 Million Dollars ready to go at a moments notice. That can do some serious movement to a low volume coin.
While we can't say that anyone is doing this on purpose, we can say that the result of someone with a large following hinting at the next explosion, is surely something that can be done inadvertently, but you'd be a fool to not realize that you are doing it. This is exactly what people like Tim Sykes does. He looks at all the mailing lists and see whats being spoken about. Which ever stock is getting the most hype, he is in and out like a ghost with a bigger bank account.
Im not saying that its wrong, but I'm definitely saying it isn't the most honest way to make money.
Its part of the game...
Specially with a no regulations market like cryptos.
But If you stop tho understand How things work, you May get a good profit.
Crypto is a profit making machine! The problem is pulling out your cash because this market keeps mysteriously growing.
Thanks so much for your boldness to awareness and open-mindness about trading especially on steemit.
Great post, Great Analysis!
Ahh totally makes sense to go long term.. watching daily changes and all the fluctuations makes you go 🤪
Yeah it's always one of those that which came first the chicken or the egg. Did the price go up because some youtuber announced a buy at a certain price or did some people just decide recently they want to buy some of that coin?
I don't trade with cryptocurrencies I find it too much like gambling, I do however like investing in cryptocurrencies that I find interesting and buy some to use like bitcoin and litecoin.
I am also very cautious about signals, if unknown, they are behind them. Those who arrange pampas are often already bought cheap, and they want to sell more expensive.