Tag Archive for: Cryptocurrency

Picking Tops and Bottoms

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ETH/USD

I want to use Ethereum to make a couple of points. If I were to add up the composite results of every trade I have made over the years that were not confirmed by a simple moving average, the figure would be negative – a big negative. By contrast, most of my large gains over the years have come from trades supported by a simple MA.

The entire advance in $ETH from early Nov 2017 through the Jan 2018 high was supported by a simple MA. Similarly, the entire decline from the late Jan 2018 high to the present has been supported by a simple MA (additionally, classical charting principles have flashed no fewer than four sell signals beginning on Feb 1).

I have no desire as a trader to pick tops and bottoms. I am very comfortable making my living between the 30-yard lines – and almost all trades between the 30-yard lines are confirmed by a simple MA. As such, the idea of considering a long position in ETH at present levels is completely foreign to me.

 

 

Factor Membership

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Peter Brandt is a 40+ year veteran of trading. Through his Factor Service, members receive:

checkTrading Commodity Futures with Classical Chart Patterns: A free PDF copy of Peter’s classic out-of-print book
checkWeekend Update: 10-16 pages full of in-depth chart analysis and charting commentary
checkAlerts: Detailed information on specific charts as unique opportunities present themselves
checkMarket Commentaries: Communications on specific topics regarding market speculation and trading distributed periodically
checkWebinars: Monthly member-only webinars where Peter speaks about current conditions and fields member questions
checkKnowledge Center: Fast and easy access to current and archived content from Peter’s extensive library of content
checkAutomatic notifications: Email and social media notifications are sent out when new content is published

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View your Factor Member options here. You could consider your membership in the Factor Service as just one more trade. If the Factor Service is not of value to you, well, it is just one more trade that did not work. Through the Factor Service I endeavor to alert novice and aspiring traders to the many pitfalls you will face – and to offer advice on overcoming those pitfalls. My goal is to shoot straight on what trading is all about. For more information watch my 30 minute webinar where we cover the Factor service in depth.

I hope you will consider joining the Factor community.

Factor Trading - An Introduction

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Structural and functional problems with the Cryptocurrency markets

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The cryptocurrency markets are in their infancy – and accordingly suffer many problems that time and technology will resolve. Some of the problems include:

  • Despite the claims of blockchain’s revolutionary technology, it takes far too long for transactions/trades to clear the chain.
  • Opening an account with many crypto exchanges can be a time consuming and frustrating experience.
  • It takes an excessive period of time for deposits to be posted to an account.
  • While coins can be safely held in hard wallets, hard wallets can become lost, stolen or damaged.
  • While coins can be sorted securely on hard wallets, what protects the flat balances at the various exchange from hackers or exchange bankruptcies?
  • Hard wallet depositories are akin to burying Gold in the backyard. It is an irony that cryptos represent the most advanced internet/financial/commercial technology, yet crypto traders are storing millions of dollars on a USB device. REALLY?
  • The bid/offer spreads at many exchanges are far too wide. It is often difficult and time consuming to “cross the spread” (buy at the offer or sell at the bid).
  • The price of the same coin varies considerably from exchange to exchange. This makes charting extremely difficult.
  • Good luck receiving guidance from an exchange’s help desk. In fact, has anyone even spoken by phone to a support person at any exchange?
  • The transaction fees at some exchanges would add time to Bernie Madoff’s sentence.
  • It can take forever to withdraw funds from an exchange – many exchanges limit the amount of each withdrawal and intentionally hold customers funds as long as possible.
  • Moving coins from one exchange to another (either directly or with a hard wallet as the pivot) can be a time consuming activity, preventing aggressive arbitrage operations.
  • The web site/trading platform of some exchanges crash when a trader most needs to place an order.
  • The cryptos are far too volatile. The volatility will prevent wide commercial/institutional acceptance over the long haul.
  • The lack of unified price settlements will also prevent commercial/institutional acceptance.

Feel free to add to this list via Twitter