This is Why I Trade Bitcoin
Good morning degens!
This week we experienced the FOMC meeting and JPOW & Co. blew us all away with essentially a nothing-burger (“priced in”) which resulted in a slow melt-up for bitcoin and it was honestly one of the funnier and awkward melt-ups I’ve seen in a long time.
More importantly I traded it UP and DOWN for more than $12k+ in profits!
This is quite literally why I learned to trade (bitcoin) because I want to make money through basic hodling — the more traditional “investing” strategy — and also when the price of bitcoin plummets!
Go figure, right?
Events like the FOMC provide great opportunities for making money on both sides of the equation because it goes from green to red really quickly. I try to give folks a heads-up on things like this! Short the rip, long the dip!
Remember? Fade the Fed!
Knowing the Fed calendar — you can find that link in the Trading Library — it’s time to put on a trade because profits are calling!
Ready? Let’s go!
The FOMC melt-up is the first orange circle below and I was able to hodl my core position of bitcoin and sell a portion of them at a profit at the local top AND I can also hedge this position and put in a contract long the price as well!
Double the money and value! More than double the satoshi count if you lock in a great trade! Then, I can re-buy bitcoin at a cheaper price, reduced price to stack even more satoshis at a discount. This is how smart sat stackers stack.
This is what we call “spot buying / selling” or 1X (levered) trading — which is what everyone who hodls bitcoin is already doing (has done), effectively. I’ll press on this point that anyone who buys bitcoin is already a trader at the end of the post — but let’s continue on with the trade, shall we?
Now, what I also wanted to do was short bitcoin’s price as she faded because that’s often an outcome what happens after the FOMC rip — so I began setting up for a conservative entry point below the starting point of the rise and began to consider an entry point for a trade here:
One might ask why I didn’t short the price of bitcoin at a higher price such as $39,600 and the answer to that question is quite simple: I wasn’t sure if the melt-up was the beginning of a larger, continuation move which would ultimately be a colossal fake-out to the downside, stopping me out and me blowing profits.
You see, I like my trades tight and with as much “guarantee” as possible so I don’t mind missing out on profits if I can do be successful with an even greater reduction in risk.
And as word spread about the rate hikes things accelerated as retail responded (institutional money had already front-run):
I wanted a clear confirmation that we’d break that last local low and so I set a target entry point @ $38,480 as a starting block and began to think through stop loss structures, profit orders, runners, and more.
Now, if bitcoin didn’t bounce and head north I’d be in the trade and it would be game time! And thankfully that’s what happened — and quick! A few moments later I was already sitting with more than $6,000 in net profit!
It was definitely time to add a stop loss to capture that win regardless of price action. Let’s do it. Time to go “stop loss hunting” — one of my favorite exercises!
The question, of course, was how long to hold! How low could she go?
My plan was to move my stop loss at every major level and, in this case, every 800-1000 points. My first stop was at $37,480, exactly 1,000 points from my entry:
Bitcoin will often bounce / retrace back beyond these stops — depending of buyer / seller reaction — so you have to be careful not to do them “too tight” and get stopped out early (but in profit!) as well as to not have too large a band that would force you to give up valuable profit unnecessarily.
And there’s always a good scare when you’re “stop loss hunting”! She almost tapped my level and knocked me out a few times on her way down to the next level:
The key is to not move your stop — commit to your sequence and be okay with the profit! At this point I would capture $6,000+ so I could be entirely happy with my work.
With the addition of spot selling at the local high and re-buying at a lower point I’ve already added both cash and sats to my stack. I could re-buy the corn I sold at profit and move those new satoshis to self-custody, mixing it as I go.
This is the way folks, this is the way!™️
I continued to check volume and volatility to confirm the current continuation and felt confident about moving my stop down as she progressed through the fade.
The fear was in the air except I was entirely enthusiastic about the fact that the price of bitcoin was going down! I was more than chill as she continued to fade and as crypto twitter screamed in pain I was actually spending time at the beach!
Honestly folks… this is the shit. I love this “job” — this is why I trade:
She continued to head south and as she blew through the first stop loss I began to set up the second to capture even more profits (and maintain my sanity and zen at the beach with my kiddo).
I chose $36,580 — another 900 points — as my new stop loss and figured that at this point I was so beyond my initial goal that anything really would be fine. No worries about being stopped out because this was already a massive win.
I was able to do this on my mobile phone too! The exchange I use has a great mobile app and I easily changed the stop loss figure while hanging with my youngest.
At this point my winning trade would net me ~$11,500 in profit if bitcoin stopped me out with a quick ride north. I had everything I needed and I relaxed and put the phone down. So good, so good.
We got close to getting stopped out early (and eventually did) but we managed to avoid it for sometime and began to look at profit taking and exiting entirely.
I looked toward $34,980 as my final destination where I’d pull out 90% of the trade and leave 10% as a runner — maybe she’d really go deep on this sprint and give me bonus wins just for kicks? You never really know.
When you have large events like the FOMC it’s hard to find patterns as everything is reshuffling in real-time and the harmonics not usually sequencing on smaller time frames which means you have to head back to larger ones like the 4hr and 1 day and even the 1 week if you need to.
All I could find, over a few hours, was this crazy Navarro which suggested upside potential but I wasn’t believing it — there wasn’t enough juice in the can and retail seemed to have disappeared from the scene. We were headed towards crabbing it out for the weekend, maybe…
Eventually I did get stopped out on a scam wick that got me before a deeper dive but I was very happy with the trade. Boom:
As I said before, steak dinner (add shrimp) tonight!
But, I wasn’t done yet!
I was very confident in my TA and so I found another local top — right after I got stopped out — and entered another tight order for a continued fade at $36,600.
I wasn’t sure how far more she’d go but I wanted profits if I could get them, especially after getting stopped out prematurely.
So, I placed the order and put my stop loss just above the local high. Profit came quickly and I hung on for a bit as I observed the price action.
This would even greater extend my winnings as bitcoin’s price continued to drop! What a wonderful dynamic! And, I was eyeing to buy cheaper bitcoin via spot as well! Even more satoshis for the taking. As weak-handed bitcoiners panic-sell their corn I’m scooping it up on the cheap besides profiting from the fade. Absolutely glorious.
If trading is a game then this game is the best game I have ever played.
It was clearly going to crab a bit more so I wanted to give it some time; I played around with some quality TA and shared it with the community on Discord:
But after a few hours and very little conviction and movement I started getting anxious and wanted to make sure I could capture profits and leave the trading floor as it was getting late and I’m not a fan of babysitting any trade.
So, I cut bait and made hay with an entry point of $36,600 and an exit at $36,473 — not much (barely more than 100 points) but I’ll take another $500 in profit! This is the power and importance of using leverage when trading as you can multiple your earnings with grand effect.
Obviously, though, it’s more dangerous and risky.
So stay frosty friends. 🥶
Now we had officially crossed $12k+ in profit for the day and I could definitely call it quits. A “good day of fishing” is what I usually call it! Or, as my wife likes to ask me:
Did you make five dollars today?
🤣
Yes, yes I did! And tomorrow we’ll do the same.
In fact, I already opened up another short order later that evening because I believe that she is going even further south on this dip! And, it’s already in profit:
So if I closed this trade out right now the FOMC meeting would have gave me more than $13,000 in net earnings — just by trading her up and down.
Update: I closed this position out:
Wow. Wow. Wow! This is why I trade bitcoin. This is why I’m a trader. The point is obvious and clear: As a wise and prudent bitcoiner I always want to maximize the possibility of growing my satoshi count in my portfolio regardless of price action; regardless of whether bitcoin is at $65,000 or it’s $35,000. One satoshi is one satoshi and either you’re mining it yourself, synthetically mining it (via a job), or you’re actively trading it, not just spot buying / hodling.
If you’re not doing these things you’re effectively “cheap liquidity” for everyone else. And if you’re DCA’ing bitcoin, especially at the local tops, then you’re really messing this up and you’re not stacking satoshis in an optimal fashion. You just paid for someone else’s cheaper sats with your fiat which you worked hard to earn.
Don’t do that!
Oh — you have a problem with “degen trading”?! You’ve got it confused because you are already a trader! You went to an “exchange” and you “traded” your fiat dollars for satoshis. You were the “buyer” and there was a “seller” on the other side. You speculated on that price and you hope and believe that the price will go up, more than the price at which you purchased the satoshis.
You are already a (degen) trader and you didn’t even know it. You bought bitcoin with fiat — that’s why we call them “trading pairs” (e.g. BTCUSD) and what you, as the buyer have effectively done is a 1X trade.
(－‸ლ)
Are you now thinking about “trading bitcoin” differently? I hope so because every single time a bitcoin maxi slams me for trading it I want to slap them sideways and tell them that they are not actually a real maxi if they aren’t doing this because they are already trading bitcoin and they are doing it sub-optimally.
In fact, if you want the cold, hard, naked truth then here you go: Bitcoiners support fiat when they buy local tops. The inverse is also true: True bitcoin maxis fight fiat when they buy local bottoms. It’s just economics and math, bruh. Get recked.
Anyone defending this type of behavior is not to be trusted and they clearly do not know math or the real pathways of how (institutional / retail) money flows and global, decentralized economics of bitcoin.
Straight cope. Truly, few.
Regularly scheduled events like the FOMC create massive volatility that gives traders — and hardcore bitcoiners — a rare opportunity for larger-than-normal upside, when it goes up AND when it goes down, and thus maximizing your fiat-to-satoshi ratio which is just economically better in every single way.
I hope this free, public post is a powerful example of how to do this and how to maximize your sat stacking workflow so you can sit comfy in-spot even while bitcoin falls off a cliff.
I mean, let’s be real: Tell me the last time you made 5-figures all thanks to bitcoin’s drop in relative price! Yes, as a trader, this is now very, very possible. Hell, now you know the facts: You are a trader already if you hold any crypto or bitcoin.
When I look back at major events like today it seems obvious that we should do this type of stuff as there are clear “tops” and “bottoms” to bitcoin’s price and the smart sat stacker will minimize DCA and maximize, at the very least, spot buying when the corn is cheap.
If they want to take their sat stacking to the next level and make even more money when she fades to hell’s gate then there are options and opportunities for you! We’ve got a growing community and I’d like to help you figure this out, if you want.
I wish you the very best on your sat stacking!
This is why I trade bitcoin because I can do it anywhere, at any time, on effectively any device, using all my creative skills and knowledge of bitcoin as alpha and an edge to maximize my satoshi count, rain or shine.
Rip or dip. That’s how to do it folks.
To infinity & bitcoin,
— 8ɃIT