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TOXIC TRADERS ☠️📌 Both optimism and pessimism is the worst thing to happen to a trader. ⚠️ Please do not believe in a chart or have a faith for that... 📍 Being realistic and trade based on reasonable facts is the best way of trading. Always make decision based on facts and DO NOT TRUST YOUR HEART NOT EVEN ONCE. ⚠️ Set your risk by considering your character; are you willing enough to take risks as dangerous as completely losing all your money? ⚠️ As I wanna mention it again: NEVER BELIEVE IN CHART. Just see it as a potential oppurtunity. 📍 Trading is a game of numbers, mathemtics, algorithms, cycles, supply and demand, economics, etc. One of the most strict majors in the human history. ⚠️ Do not include your emotions and or you belief or faith in this game. This is not a financial advice, I just am willing to share my own experiece with you guys With y'all a very happy and profitable lifestyle
NASDAQ:AAPLEducation
by C_EWAVE13
5
Do you suffer from (Retail Sentiment)What is retail sentiment? Have you ever noticed on your broker site that it has a statement along the lines of "70%+ of retail traders lose money"??? This is directly related to retail sentiment - in short, institutional money make their money on others losing money in the online marketplace. Every forex trader will always have an opinion about the market. “It’s a bear market, everything is going to hell!” “Things are looking bright. I’m pretty bullish on the markets right now.” Regardless of the technical analysis or the news that comes out, traders often get it wrong. There's some simple logic to this, If you look into COT reports (Commitment of Traders) 🍪 see the last COT post if you're not familiar with COT. Well in addition to COT there is also a tool called sentiment - this info shows what traders are doing on global broker platforms such as IG index. In this current condition and at this precise time it has a mixed bag of; SPX 47% of retail are long - now you would assume with a long stock market it would correlate to a weaker DXY situation, yet retail are also 57% to the short side on EURUSD. Which makes very little sense. Now assume this is only a small minority on one platform like IG index. Well - with another look, you will see retail are currently; Long - USDJPY 67% (Long DXY) Short AUDUSD 63% (also long DXY) However, 76% long USDCAD - and then long Gold 83%. Do all the numbers match up? Knowing 70% or more of retail traders lose money - what would you say? Unfortunately, since the forex market is traded over-the-counter, it doesn’t have a centralized market. This means that the volume of each currency traded cannot be easily measured, but again this is where COT can be used in parallel to the sentiment. This might be 👽 to you right now. But it's a very powerful tool. On the COT side, you can see into the volume traded and will notice if brokers are net-long, institutional investors are often net-short. Buyers need sellers. It's as simple as that. IG sentiment can be found here - www.dailyfx.com Hope this helps someone. Disclaimer This idea does not constitute as financial advice. It is for educational purposes only, our principle trader has over 20 years’ experience in stocks, ETF’s, and Forex. Hence each trade setup might have different hold times, entry or exit conditions, and will vary from the post/idea shared here. You can use the information from this post to make your own trading plan for the instrument discussed. Trading carries a risk; a high percentage of retail traders lose money. Please keep this in mind when entering any trade. Stay safe.
Education
by Mayfair_Ventures
4
The Master Market Analysis Venn DiagramFundamental Analysis Fundamental analysis is a method of assessing the intrinsic value of a security by analyzing various macroeconomic and microeconomic factors. The ultimate goal of fundamental analysis is to quantify the intrinsic value of a security. Its intrinsic value can then be compared to its current market price to help with investment decisions. This method of analysis is the main one used to evaluate the quality of an investment. In many ways, it is considered the foundation of making informed investments. Fundamental analysis involves studying the qualitative and quantitative factors that affect the value of a stock, bond, or other kinds of security. The goal of this process is to identify the true value of a security. Investors can use this number as a benchmark to determine whether a security is currently priced under its value, over its value, or at price. This evaluation comes from a variety of sources, including factors as large as the state of the economy and as small as how the company is managed. Typically, the current state of the economy is evaluated first, followed by the state of the industry that security is in. After analyzing these macroeconomic factors, the company's individual performance is evaluated, including their latest earnings reports and the company's management style. These factors culminate to determine the fair market value of the security. How to Use Fundamental Analysis in Investing Investors use fundamental analysis to maximize the performance of their portfolios. Generally, fundamental analysis is performed by stock analysts in order to give recommendations to an investor. Identifying securities that are not accurately priced allows the investor to purchase stocks that are undervalued, avoid purchasing stocks that are overvalued, and sell overvalued stocks that the investor currently holds. Long-term investors tend to benefit the most from fundamental analysis, but short-term investors can also make use of this method to optimize their portfolio returns. Analysts perform fundamental analysis whenever they are making recommendations to an investor, but markets see the greatest volume of trading after companies release their earnings reports. While companies can publicly release these reports at any time, most companies do so one to two weeks after each quarter ends. Technical Analysis Technical analysis is a means of examining and predicting price movements in the financial markets, based on an asset’s chart history. It is one of the two major schools of market analysis, with the other being fundamental analysis. Unlike fundamental analysis, technical analysis is based purely on the price charts of an asset. External factors and intrinsic value are not taken into account, with the identification of patterns on a chart instead used to predict future movements. Technical analysts have a wide range of tools to find trends and patterns on charts. Some of the key tools used include moving averages, support and resistance levels, or bollinger bands. All of the tools have the same purpose: to make understanding chart movements and identifying trends easier for technical traders. WHAT IS MARKET SENTIMENT? Market sentiment defines how investors feel about a particular market or financial instrument. As traders, sentiment becomes more positive as general market consensus becomes more positive. Likewise, if market participants begin to have a negative attitude, sentiment can become negative. As such, traders use sentiment analysis to define a market as bullish or bearish, with a bear market characterized by assets going down, and a bull market by prices going up. Traders can gauge market sentiment by using a range of tools such as sentiment indicators (see below), and by simply watching the movement of the markets, using the resulting information to make their decisions. Sentiment Analysis Sentiment analysis is the process of identifying the positioning of traders, whether net long or net short, to influence your own trading decisions in the market. While sentiment analysis can be directly translated to forex, it is also used for stocks and other assets. Contrarian investors will look for crowds to either buy or sell a specific currency pair, while waiting to take a position in the opposite direction of sentiment. Don't forget to let us know what method(s) of analysis you use….. and why?
Education
by abel11
26
Why does technical analysis work?Introduction If you're here on TradingView, it's probably because you believe that charts and technical analysis can give you an edge in the trading of currencies, metals, cryptocurrencies, and stocks. Granted, sometimes technical analysis doesn't work, but it works often enough to keep hundreds thousands of traders coming back here day after day. The larger question is why . Four Reasons Technical Analysis (Sometimes) Works To a fundamental trader like me, technical analysis can sometimes seem like voodoo. Why should lines on a chart tell me anything useful about the total value of future dividends and cash flow for a stock? I admit I especially roll my eyes at Fibonacci ratios. Personally, I feel they're about as scientific as using divination or horoscopes to buy and sell stocks. But then again, if a lot of people believed that their horoscopes could help them win at stocks, you'd be a fool to ignore them. In fact, you could then gain a large edge by using astronomical data to forecast future horoscopes, getting tomorrow's horoscopes today. Which brings us to the first and most basic reason that technical analysis works: It works because people believe it works. If a lot of traders believe that Fibonacci ratios apply to stock markets, then a lot of traders will set their buy and sell orders at significant Fibonacci retracement levels. And then there's another whole contingent of traders who don't believe in Fibonacci numbers, but they know that lots of other people do, so they set their buy and sell orders there anyway. It becomes a self-fulfilling prophecy. Active trading is largely about predicting what other traders will do, and technical analysis is their playbook. And predicting other people's behavior brings us to the second reason that technical analysis works: It works because human psychology follows patterns. For instance, trend-following strategies might work, in part, because of "bandwagoning" and the "Fear of Missing Out" (FOMO). If traders see their friends getting rich off of Tesla or Bitcoin, they will fear being left behind. Speculative enthusiasm cascades through social networks until it has saturated them and everyone is leveraged long to the gills. Only when there's no one left to convert does the momentum finally stall. (Wall Street traders often quip that when their barber starts giving them stock tips, the market is saturated and it's time to sell.) As for support and resistance levels, they work partly because of regret. People remember the price they paid, or the price they wish they had paid, and that memory then shapes their behavior. For instance, if traders remember that they missed several opportunities in 2020 to buy an SPY dip to $323, then they are more likely to buy that level in the event of a future dip. What about oscillators? Well, perhaps humans distrust anything that moves too fast. Even if I'm romantically interested in someone, I'll still pull back if she proposes marriage on the first date. Plus, humans are loss-averse, so at some point we like to lock in gains. It works because it takes time for the market to fully price in news . The advent of algorithmic trading has made it hard for traders to gain an edge by reacting to news events. Stock prices move fast the moment a headline hits, so by the time you see it, you may already be too late. That said, algorithms are pretty good at picking the direction a news event should move a stock, but not necessarily the magnitude . The initial fast news response is often followed by a slow news response as the information spreads through the human population and its implications are assessed and priced by human traders. Trend-following strategies may be able to pick up on these slower processes of repricing in light of news. It works because today's news begets tomorrow's news . This is probably the most underappreciated of all the reasons that technical analysis works. Good news often leads to more good news. If a company posts a large positive earnings surprise, then there's also a good chance that it will get a dividend raise, analyst upgrades, or upward revisions of future estimates in the days or weeks to come. Likewise, bad news often leads to more bad news. For instance, if the company posts a negative earnings surprise, then there's an increased chance that it will need to take on debt or issue shares to sustain operations in the future. The same principle applies to industry-wide or even economy-wide news. If, for instance, the state California bans a company's product, then there's an increased chance that other states will follow suit. And if the Federal Reserve cuts or raises rates, then the next rate change is likely to be in the same direction, because Fed policy goes in cycles. The news-begets-news principle means that trend-following strategies might work, in part, because they are detecting the current direction of the news cascade. Three Reasons Technical Analysis Sometimes Doesn't Work I should emphasize, however, that technical analysis doesn't always work! Here are a few reasons it might not work sometimes: Traders try to anticipate signals . The larger the number of people who know about a trading technique, the less well it works. Take supports and resistances, for instance. If I expect the rest of the market to buy at a particular Fibonacci or moving average level, then I might place my own buy order just above that level in an attempt to front-run everyone else's move. If enough people do this, then the price may not ever actually reach that level. Whales create fake signals in order to harvest profits from technical traders. For instance, if a whale knows that a lot of people have stop loss orders set at a particular support level, then the whale might short a stock to that level in order to trigger all those sell orders, causing a price collapse and an opportunity for the whale to buy shares at a cheaper price. Timing risk. Sometimes you can correctly identify the direction of the trend but still have bad timing. For instance, we're in an interest rate-cutting cycle by the Federal Reserve, which has caused a strong upward trend. But the reality is that we're probably near the end of that cycle. If the Federal Reserve suddenly changed its tune tomorrow and started forecasting rate hikes next year, it would take some time for that information to be fully reflected in slow-moving technical signals, and you could lose a lot of money if you sell only after those signals change. It's perhaps best, then, to have a good understanding of what's driving a technical trend so that you can get out early if you see the underlying drivers change.
Editors' picks
AMEX:SPYEducation
by ChristopherCarrollSmith
77
A Market Probe Versus A ShadowA Market Probe Versus A Shadow A market probe is a way for the bulls and bears to measure the market desire to advance further in the current trend direction or not. A shadow is a rejection of the price reached; therefore, a reversal is more likely to follow with a shadow. The question that I ask myself when I see a candlestick shadow is, "Is that a shadow or a market probe?" Let review the monthly chart of TSLA Tesla Inc's stock for an example of a market probe. In February 2020, with the monthly chart, we can see an upper shadow of the candlestick, which is often misinterpreted as a shadow, but instead, it is an example of a market probe. The market probed the price level of $191.16 but shortly retreated. The lower shadow for March 2020 is a bear trap. A bear trap is when the market gives a false bearish signal instead the market makes a price reversal and continues higher. In June 2020, the stock price of TSLA Tesla Inc advanced above that price level probed back in February 2020 which is $191.16. Again July 2020, the TSLA Telsa Inc probed a new high price of $357.90 and reached the current market price of $609.99 (as of the market closed on Friday, December 11, 2020). That is an increase of 221.76% from the initial market probe in February 2020 of $191.16. The next question I think is how to determine whether that is a shadow or a market probe? Furthermore, the question after that is: Is that a market probe or a bull trap. Let save that for another discussion because that will require a more in-depth market analysis and more articles. Ultimately, it is the immediate market conditions and the final market decision that determines the price. Thank you for reading! Please click Like and click Follow to see more. Greenfield Disclosure: Just a humble market opinion by Greenfield Analysis. This is not a recommendation. Greenfield Analysis has no investment in any of the securities mentioned in the article, no plan to initiate a trade in any of the securities mentioned, and does not receive any compensation for this market opinion.
NASDAQ:TSLAEducation
by GreenfieldAnalysis
2
A Probe Versus A ShadowA Probe Versus A Shadow The candlestick shadow refers to the upper and lower thin lines of the candlestick body. A lot of that has been written already by others, so in this article, I like to mention just a few differences between a probe versus a shadow. A market probe is a measurement tool. A market probe checks the sentiment of the bulls compared to the sentiment of the bears. A bull probe is when the bulls test a new higher price level, and a bear probe is when the bears test a lower price level. I think a shadow is a possible price reversal, and a probe is when the price explores a new price and may advance further in the same direction. Is that a shadow or a probe? Let save that for another discussion. To answer that question, it will require a more in-depth market analysis of the immediate market conditions and ultimately the outcome depends on the market decision. Thank you for reading! Please click Like and click Follow to see more. Greenfield Disclosure: Just a humble market opinion by Greenfield Analysis. This is not a recommendation. Greenfield Analysis has no investment in any of the securities mentioned in the article, no plan to initiate a trade in any of the securities mentioned, and does not receive any compensation for this market opinion.
TVC:DJIEducation
by GreenfieldAnalysis
7
The Secrets to Forex & Why You're the Wrong Type of Loser (pt.1)This is a 'many-part' educational series to help turn smooth brains into folded brains. The series reveals the true power of the social and psychological factors shaping markets. This is abstracted from 7,000 hours of research in markets and finance and is a synthesized thesis between my research, John Boyd's work on strategy and adaptability, and David Bohm's theories on emergent behavior. The endstate for the reader will be vastly improved risk management, and novel methods for reducing uncertainty. Part 1: Why 85%+ of Retail Traders are the Wrong Type of Loser The true holy grail of markets.. the risk-free rate of return asset, doesn't exist (even perpetuity coupons aren't risk-free). Risk or uncertainty permeates all aspects of our reality. Managing risk is a fundamental component of all business, law, politics, military affairs, sports, etc. It is essential to any form of competition (which markets are). Virtually every element of any strategy employed anywhere involves risk management. It's more than just money... its everything; your relationships, your happiness, your experiences. Your ability to manage risk and uncertainty will positively correlate to your future quality of life. Why? Because we can't see the future, but we live into the future. Thus, no matter your wealth or political power, uncertainty is still your master. Fear of uncertainty drives your psychology, the psychology of other individuals, organizations, and even nations. And what these entities do, affect you. Even at subconscious levels. Those that fight uncertainty, do so at varying levels of competence. In the world of derivatives, and for our interests its sub-class: forex, speculation against uncertainty shapes most of the price discovery experience visualized on your favorite candlebar chart. What happens on your chart on higher timeframes is the result of speculation; even those with carry trade positions are still speculating about rates and central bank decisions. The only people who aren't speculating are insider trading, which is illegal. It's illegal to not speculate... Make no mistake, in the world of speculation, those that fight the best battles, are the ones who fear uncertainty the most and go to the greatest lengths to conquer it. But we already determined that you can't conquer it, you can't see the future. So what does a 'best battle' or 'meeting halfway' even look like in trading? What do you call a loser that doesn't always lose? Let me stop for a second. You're probably thinking: 'this is obvious, no one wants to lose money, everyone is afraid of what they don't know, the future is unknowable, etc' 'How does this help me make money?' First, you need to understand what you are in this game called Markets. In this oddly balanced game, those with the most to lose often have the biggest say. And vice versa. You are the vice versa, the retail trader. Retail traders comprise 4 categories that often overlap, ie: people who usually do not have a professional background in investing/trading, or a professionally relevant education, or professional connections as a major client or data access, or a high networth. Your competitors are the opposite (they are all those things and more): the winners, the market makers, the whales, the money printers, the ones with the biggest say, the old money, the 'smart' money, whatever cringy title you want to give them. Commercials/institutions/fund managers/portfolio managers/pension managers/etc.. These guys are speculating about the future, just like you. But their speculation is what shapes price discovery and market movement, YOURS DOES NOT. This means that whatever you think the market does or should be, DOES NOT MATTER. Your fibonacci, does not matter. Your head and shoulders shampoo/pattern, does not matter. Your sup/res lines, do not matter. Your moon cycles, do not matter. Your RSI/MACD cross, does not matter. The only thing that matters, is what these commercials/institutions think. That's it. If they think that this head and shoulder on the 4h EURUSD matters, then it matters. If they think the moon cycle this month matters, then it matters. If they think communism is good for business, then it matters... etc. It's exactly as irrational as you might think. Now, with their fiduciary responsibilities, they do have to justify their picks. So moon rune interpretation is usually off the table. But guess what. These guys, despite their immense wealth, their research teams stocked with specialists with PhDs, and all the instant access to prime data in the world.. they still lose. They lose all the time, and they lose big. Eye wateringly big. The vast majority are barely winning 60% of the time, if even that... That's why many are offloading into 'less competitive' money-making opportunities; like underwriting, checking accounts, or alternative investments. Competition itself is too much of a risk for their uncertainty appetite. You have to applaud their level of greed. But to stay on target. Whether your technical system is profitable or not is often a factor of the fitness of your indicators with whatever strategy the commercial is using to execute entry implementation (or combination of models or commercial strategies). And when a few of their models/strategies are losing, it makes it even harder to win at this game (or in those instances, your system might win, whilst you rejoice at the amazing ability of your moon cycles to predict the future). But let's back this up, did some of you notice something off? 60%~ ... That's actually not bad. A trader who's experienced at losing (and yet making a profit in the long run) would kill for an average position win rate like that. Instead of thinking, "how do I avoid losers entirely" Stop wasting whatever brainpower you have. Start thinking, "how do I minimize my losers?" The losing positions are always going to happen, no matter your system. All edges fade, and even a mythical system that won 90% of the time will weaken over months or years. But if you learn to master the art of 'losing,' the overall win rate of your positions can AFFORD to be low. In many cases, it could even be less than 50%, and you could still make a living as a trader/investor. The best and brightest, the commercials and institutions, are barely going 60%. What makes you think you can do better? Does it mean all hope is lost? Not even close. It simply means that you need to focus less on your directional/positional bias strategy (the winrate), and more on your risk management strategy. You have to become the right type of retail trading loser, the 15%~ or so that retail brokers survey as profitable. These guys are losing 40%, 50%, 60%, even 70% of the time, and some of the them are still making big money. It's counter-intuitive but they are the guys winning at losing, and turning that into a living. Your ability to survive losers.. to adapt to uncertainty , is the first secret and the most important step into the weird world of profitable derivative trading. Okay, so you might be thinking: "Again, obvious. Isn't that just 2%? Isn't that just low margin? Only trade Majors? 100 pip SL?" If those were the first things you thought, then we still have a very long way to go. Fortunately, this is just the introduction. See you next week for part 2: 'time as the dominant parameter, fair value, and the 'center of gravity.
Education
by CountofCoins
Profiting from Order Flow: How to follow the Institutional MoneyHow Order Flow and Liquidity Move the Market Order flow is the key driver which causes market price to move, buyers and sellers enter the market at different price levels by either supplying liquidity (via Limit orders) or consuming liquidity (via Market orders). When the liquidity balance is tipped, being more buyers than sellers (or vice versa) at a particular price level, the market will move until it reaches equilibrium again. From the charts this is immediately apparent, by looking for the Support and Resistance levels which indicate a liquidity imbalance - causing price to bounce, moving to the areas of consolidation which indicates the equilibrium zones. Which is the rhythm of the market constantly repeating itself time after time. The market participants trading the largest amount of volume will ultimately move the market. Those being the most capitalized institutions such as Investment & Commercial Banks, Governments, Funds, Corporates and Institutional Investors. By analysing the Institutional Order Flow, we can make far more informed decisions on where price is likely to go and devise a trading strategy based upon this knowledge. How to read Order Flow There are many ways to read order flow - on exchange traded markets with central order books you can analyse the market depth and time and sales, to identify the price levels where large orders have been executed and where they currently lie (given they are not hidden). However, for OTC markets like Spot FX, it is not as transparent as the market is fragmented, non-centralised and lacks a common order book. The market depth available on ECN’s and broker platforms is localised to that venue and will likely not give a true picture of where the large Limit orders rest and the overall market sentiment. Our Indicators 1. Futures Volume – We will use CME (Chicago Mercantile Exchange) Futures volume. As the Futures price mimics the Spot price, the volume can be used as a reliable indicator to guarantee accuracy due to both markets being directly correlated, and there being a transparent central exchange-based order book. The Volume displays the number of Futures contracts traded for a certain time period (hour, day, week, month, etc.). Analysing the traded volume is an integral element of the analysis, and according to the dynamics of the volume, we can judge the significance and strength of the price movement. This indicator shows a fixed interest of the market in relation to some prices or price ranges. It follows that price fluctuations, one way or another, are derived from the inflow or outflow of funds into or out of the market. Therefore, by analysing the volume we can determine the potential places where a price move will start or end. This is due to the cyclical nature of price movements flowing from one volume level to the next in a rhythmic nature, which repeats itself over any time period. 2. Delta – This is the difference between orders executed at the ASK and BID prices. Which is the CME Futures volume of BUY contracts vs SELL contracts traded; it allows us to see the “footprint” of the market beyond the simple candlestick chart. The net delta value will therefore be Positive or Negative and represents the current market sentiment. A positive delta indicates “positive” order flow as the result of buyers being more aggressive at that price. A negative delta indicates “negative” order flow as the result of sellers being more aggressive at that price. Consequently, based on the delta we can quantify the potential direction of future price moves with a greater level of conviction, as there is a high correlation between price direction and order flow. Delta is usually used in several applications: • studying of the general background of the market sentiment • searching for a "large" deal • divergence of the delta, etc. 3. Retail Market Sentiment – This is the current positioning and attitude of Retail investors and is a ratio of Long/Short positions on particular currency pairs. From studies on behavioural finance, market sentiment is seen as a good indicator of market moves, especially when it is at extreme levels. We will use the MyFXbook Community Outlook indicator as it is a rich data set sourced from hundreds of thousands of live retail trading accounts across the globe, trading with a multitude of independent retail brokers. We will use this tool as a contrarian indicator to “bet against the crowd”, as typically very bullish sentiment is usually followed by the market going down more than often and vice versa, combined with the fact that a high percentage of Retail investors are unsuccessful. The Strategy The key principle of the trading strategy is to discover moves and plans of the Institutional market participants and follow them. The volume shows us where they entered the market (volume levels), the delta shows a disproportion between them (sellers vs buyers). As a result, we can define where the “Institutional players” have their positions (volume levels), determine who dominates the market currently (with the help of delta), and replicate their positioning to make a profit. Additionally, the system always trades against the “crowd” (retail traders) as they have the highest probability of losing money on regular basis. For that purpose, the sentiment indicator is used, which displays the “mood” of the market. For example, we will be looking for a combination of the following for our entry/exit, as they indicate the turning points in the market: 1. High Volume levels 2. High Delta levels 3. High Retail Sentiment level, which is opposite to the Delta In summary, the system is based on volume-delta analysis, trend-following, and intraday-swing trading. SLs and TPs are always set; and the minimum risk/profit (SL vs TP) ratio is ½. To see further analysis and trade ideas based on these principles please follow us! The Professional Traders choice: VARIANSE
Education
by VARIANSE
9
Study: Crypto Mentality Shift - Potential Bull Market Trigger?Hello and welcome to the revision of my working theory regarding market patterns in cryptocurrencies. This analysis follows my previous write-up regarding why intra-day traders in cryptomarkets should focus on alt-usd pairs as opposed to BTCUSD, found below: In this analysis, I focus on the 4-hour timeframe as opposed to the daily timeframe found in the original. This is due to my impression of a change in market mentality, rendered by BTCUSD's most recent upward thrust from 6,750 to 7,350. During this movement, many alt-usd pairs followed BTCUSD, although some lagged in performance. However, in the following days - as BTCUSD consolidated at the 7,300 level following a rejection of the 1.618 Fibonacci level from the previous week's range, many alt-usd pairs retraced the majority of their upward movements that mimicked BTCUSD. I have been closely watching beta and correlation levels in this scenario, as I believe this is an important signal and should not be discounted by traders in the space. What we are seeing is a weakening of a long correlation pattern between BTCUSD and alt-usd pairs, with a weakening beta on alts. It was always my belief that this correlation would break, as per the previous study. However, in the current state of the market, we see the correlation break favoring BTCUSD, meaning that BTCUSD is maintaining its new-found value at the expense of alts. Given this developing relationship, a strengthening BTCUSD will attract more alt-traders, while alts will continue to lose strength and therefore value. In addition to this, as the trading volume in BTCUSD has been declining over the majority of the YTD, it is very possible that we will see a large volume breakout on a daily level, which again - will be funded by declining alt coins. Overall, this would give BTCUSD a good push for further uptrend progression. I believe that BTCUSD has a high possibility of reaching levels between 7,700-7,850 in the near term, but this will be a painful journey for alts, as traders of the previous mindset (high correlations, high betas) will attempt to push alts. I strongly doubt most alts will exceed their local highs, which were developed on BTCUSD's push to 7,350. This is simply because the alt-usd retraces seen during BTCUSD's consolidation are simply too large, which deter the confidence in the alt market. Those who did not take profit on the initial rise will be anxious to get out, keeping the selling pressure on alts strong. See chart below for my BTCUSD targets: My theory is further reinforced through an analysis of 4-hour betas and correlations on an individual basis between large cap alt-usd pairs on Bitfinex. This collection of low 4-hour betas (SMA-smoothed on a 3-period basis) amongst the entire grouping has not been seen since February/March. If this trend continues, we will begin to see negative betas (negative correlations). In conclusion, my theory is that a market mentality shift is taking place . Traders are willing to remain bullish in one asset class (BTCUSD or alts-usd) while the other asset class is declining. In our case, this currently favors BTCUSD. While this shift may be painful in the short term for alt-usd pairs, this is a very bullish sign for the market. This means that people are able to maintain their confidence in cryptocurrency as a whole. Previously I noted high correlation and high beta patterns, that implied that sideline money was coming into alts-usd and BTCUSD simultaneously, as well as exiting both markets simultaneously. This change implies that the money will begin to flow in a cycle, from one asset class to another, allowing the market strength to develop and gradually begin a bullish cycle. tl;dr: Times are changing - we are potentially entering Timespan D. Thank you :)
BITFINEX:BTCUSDEducation
by checkm8
6
Twitter Sentiment ScriptGBPUSD |-0.208333333|Negative i.imgur.com Buy on the bounce ??? Little python script i would like to share to the TV community i made it works out twitter sentiment for most things, crypto currency's or forex. ie: Today GBPUSD = Negative, and we can see the charts agree. Todays Forex Sentiment <--- Crypto Currency Sentiment Example # Shows forex currency + how many times its been mentioned on twitter within 24hrs + trade symbol + # percentage of change in mentions + sentiment from twitter by breaking each sentence the symbol has been # mentioned in into individual words then rating the words using a lexicon of words and feelings a score # has been assigned from -1 to 1, then based on the score a rating of POSITIVE or NEGATIVE is given # using a threshold. Results are saved in a txt file and printed to terminal Crypto Version: github.com Forex Version: github.com
Education
by console
4