BTC - Pushing Through Stops - "Fishy" Business
Another day of a selloff and the "fake news" sites are searching for an explanation. So was it Goldman Sachs bearish tone on Bitcoin? Seriously they just bought Poloniex for 400 million how bearish is that? "Asian whale" moving Bitcoin to Huobi for an anticipated selloff? You can not be serious! Maybe it was fallout from the OK exchange? (old news). Wait we can always fall back on the "tether" conspiracy. News may drive the retail newbie trader, but it does not drive markets (at least for the most part). We do not have to look any further than all the "Tariff War" FUD spoon fed to the masses daily while the S&P and NASDAQ push to new highs.
There could have been many reasons but there are two likely culprits.
1) A fat finger trade
2) Fishing for Stops
I hear often "Man Manipulation is real man". No kidding so if you feel safer in the kiddie pool head down to Wal-Mart and pick one up for $69. In this game you need to wear your big boy pants, so if you don't have a pair, call 1-800-ura-puts.
The selloff was abrupt and out of no where, and was not in a place where we would have expected it. If we follow the money it is pretty clear that someone was fishing for stops, and pulled in a boat-full of flounders. At first I thought, wow a fat finger trade, but then looking a little further into the charts, I believe it was a larger trader(s) or exchange taking advantage of the market conditions and pushed through stop orders triggering a selloff where they had buy limit orders at a lower price.
This is not isolated to cryptos. This happens in all markets, gold, silver, forex, and a host of others. It is part of the game. Perfect level for longs to add with a buy trigger that was as obvious as the day is long. It was the perfect setup for a large trader to fish for stops. This is the sole reason I do not personally use stop loss orders. Why? Slippage! I have mentioned this before.
This zone has been on our chart since the 31st so it is not a huge surprise we tested it. To be fair, I thought 7235 would hold support, but its not what I think, its what the market does. The key level here is still 6850. We would like to see a rebound to 7200 overnight, signaling the market is strong and the selloff was simply noise. A push through 6850 negates our current count, and we would look at more of a range bound trading pattern. Lets not jump to conclusions, and we definitely do not want to react to the market, as this is something the herd does. We are sitting with 75% of a full cash position, just waiting for this type of opportunity and the reason Cash Is King!!! Especially during fire sales.
Portfolio and trade management is not about being right all the time.. It is about money and trade management. It is about having no fear during pullbacks, and being ready to take advantage of markets out of favor. We are simply waiting for the dust to settle, and whether it was a fat finger, or a fat whale, it doesn't matter. It is part of the game and we can look to use it to our advantage. Definitely looking to add if the setup is right and will post the strategy on SC.
Stay Calm, grab a Yuengling and enjoy your Saturday night!!!
There could have been many reasons but there are two likely culprits.
1) A fat finger trade
2) Fishing for Stops
I hear often "Man Manipulation is real man". No kidding so if you feel safer in the kiddie pool head down to Wal-Mart and pick one up for $69. In this game you need to wear your big boy pants, so if you don't have a pair, call 1-800-ura-puts.
The selloff was abrupt and out of no where, and was not in a place where we would have expected it. If we follow the money it is pretty clear that someone was fishing for stops, and pulled in a boat-full of flounders. At first I thought, wow a fat finger trade, but then looking a little further into the charts, I believe it was a larger trader(s) or exchange taking advantage of the market conditions and pushed through stop orders triggering a selloff where they had buy limit orders at a lower price.
This is not isolated to cryptos. This happens in all markets, gold, silver, forex, and a host of others. It is part of the game. Perfect level for longs to add with a buy trigger that was as obvious as the day is long. It was the perfect setup for a large trader to fish for stops. This is the sole reason I do not personally use stop loss orders. Why? Slippage! I have mentioned this before.
This zone has been on our chart since the 31st so it is not a huge surprise we tested it. To be fair, I thought 7235 would hold support, but its not what I think, its what the market does. The key level here is still 6850. We would like to see a rebound to 7200 overnight, signaling the market is strong and the selloff was simply noise. A push through 6850 negates our current count, and we would look at more of a range bound trading pattern. Lets not jump to conclusions, and we definitely do not want to react to the market, as this is something the herd does. We are sitting with 75% of a full cash position, just waiting for this type of opportunity and the reason Cash Is King!!! Especially during fire sales.
Portfolio and trade management is not about being right all the time.. It is about money and trade management. It is about having no fear during pullbacks, and being ready to take advantage of markets out of favor. We are simply waiting for the dust to settle, and whether it was a fat finger, or a fat whale, it doesn't matter. It is part of the game and we can look to use it to our advantage. Definitely looking to add if the setup is right and will post the strategy on SC.
Stay Calm, grab a Yuengling and enjoy your Saturday night!!!
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