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Nice piece. Very good information. I only question one thing.

Answer (Harry): "𝘐 𝘯𝘦𝘷𝘦𝘳 𝘶𝘴𝘦 𝘭𝘪𝘮𝘪𝘵 𝘵𝘳𝘢𝘥𝘦𝘴. 𝘈𝘭𝘸𝘢𝘺𝘴 𝘮𝘢𝘳𝘬𝘦𝘵."

I was taught to (generally speaking)  use limit orders to buy and market orders to sell, and that is my custom when I am trading (which is not very often). It's a very old bit of accepted wisdom in stock trading. I didn't invent it. I read it in some dusty book many years ago.

The REASON is that the priorities for buying are different than the priorities for selling.

Market orders used for buying can result, in the right circumstances, in paying a large premium. In buying, I want to get the best CURRENT price, and not get held up by the MM's. A limit buying order ensures that will happen.

It does take a little longer, and maybe for the Harrys of the world, it's time they don't have, if they are buying on breakouts. But I often buy coins that are substantially out of favor ( with the idea being that they are currently undervalued by the market) and I don't need split second execution speed. I can usually take my time on buy orders.

Limit orders for selling, especially in chaotic, toping markets.......CAN result in your critical sell order not getting executed AT ALL....... In that circumstance a market order is preferred. I would never use a limit order to cash out.

I have far less CRYPTO trading experience than many people I know here, and on other forums.......but these are rules that I think apply across various markets and  make good sense in general terms.

Looking forward to what the real traders here think about that one detail.

One other less important point is that Trading View has a lot of ads if you aren't a paid subscriber. These aggravate me to no end. I am not really a trader at all, but my toilet training requires me  to study the charts of my assets daily. And....I actually enjoy it.

I find that by opening the Bitfinex site and clicking the Demo button, I can access the same exact  charting tools as Trading View, but sans the ads.

Edited by dr_ed

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5 hours ago, Hodor said:

Blog URL:  https://coil.com/p/Hodor/Trading-Secrets/L2hpzS-5W

Do you want to learn about effective & proven crypto trading techniques?  After two years, I finally cover the topic of technical analysis with valuable input from both @HaraldoXRP and @sentosumosaba!

I hope you enjoy the read: Please feel free to share my blog with a friend or share it on any other platform - and thanks for doing so!  :victory:

My blog announcement links on other platforms:

Your definition of "Shorting" is incorrect. You have loosely described someone "Being Short" on a position, that sells and later rebuys.  There was no discussion of puts, options or leveraged margin trades. Short volume data is incredibly important and it's unfortunate you didn't expand on this....Check out Bitmex if you're interested.

For equities data, FINRA

e.g.: http://regsho.finra.org/regsho-Index.html

P.S. just re-read my post and realize I may have come across as being a bit curt. Not my intention, just feel that "shorting" (retail & tut.) in general is one most important driving forces behind this price manipulation, and that it may deserve a deeper look. That being said I still love ya, and appreciate everything you do (and have done for many years!)

 

Edited by PhiGuy

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really needs some info about stop loss and risk management i think...

hodor i love you man, but i very strongly suggest getting feedback from other professional traders (i.e. with a background in consistently profitable trading across multiple asset classes) on this article as i do feel there is some responsibility here to include risk management principles, because frankly it is THE NUMBER ONE most important aspect to trading and i don't know a single pro who wouldn't talk about this before any other aspect like TA, order book analysis, etc

also worth mentioning, real traders are NOT interested in price predictions, ever -- this is the biggest misconception about trading -- you almost expect to lose going into a trade; again, it's the understand of statistical risk management that creates profit, NOT predicting prices 

with love !!!

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also for what it's worth, i've thought a lot on the topic of 'investing' vs 'trading' as there's lots of confusion, rightfully, on the topic

in the casual colloquial usage, in some senses it's just that trading is fast investing, and investing is slow trading (as an analogy, a clock being a fast calendar, a calendar being a slow clock -- both track time intervals/cycles) 

however, the only definition that really matters is one that can be used consistently, and the best one for the job i've found is the legal one (dependent upon your region and system of law, caveat!) for ex., in the UK, you're considered a 'trader' (or more accurately, to have engaged in trading) when your dominant income is, consistently, in profits made from trading between assets/currencies... in other words, it's the 'salary' aspect that limits the meaning for the definition ; whereas, investments could be, again as an example, legally to be a different source of 'income' and be e.g. liable for capital gains for holding a stock for over a year then cashing out

so there are tax implications, which again, TRADERS (in the true meaning of the word) need to and do consider when engaging in trading professionally (day to day, or week to week, but essentially as the main source of their REGULAR income) 

just wanting to add something constructive (if it is!) and not always be the critical grumpy bear :D :heart:

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45 minutes ago, zerpdigger said:

also for what it's worth, i've thought a lot on the topic of 'investing' vs 'trading' as there's lots of confusion, rightfully, on the topic

in the casual colloquial usage, in some senses it's just that trading is fast investing, and investing is slow trading (as an analogy, a clock being a fast calendar, a calendar being a slow clock -- both track time intervals/cycles) 

however, the only definition that really matters is one that can be used consistently, and the best one for the job i've found is the legal one (dependent upon your region and system of law, caveat!) for ex., in the UK, you're considered a 'trader' (or more accurately, to have engaged in trading) when your dominant income is, consistently, in profits made from trading between assets/currencies... in other words, it's the 'salary' aspect that limits the meaning for the definition ; whereas, investments could be, again as an example, legally to be a different source of 'income' and be e.g. liable for capital gains for holding a stock for over a year then cashing out

so there are tax implications, which again, TRADERS (in the true meaning of the word) need to and do consider when engaging in trading professionally (day to day, or week to week, but essentially as the main source of their REGULAR income) 

just wanting to add something constructive (if it is!) and not always be the critical grumpy bear :D :heart:

Exactly.

post from last year:

In Canada there is no magic formula and each situation is dependent on its own facts in determining whether you owe capital gains or your profits are to be considered income.

Factors Considered by the Courts

the frequency of the transactions;

the duration of the holdings;

the intention to acquire the digital assets for resale at a profit;

the nature and quantity of the securities/DA's; and

the time spent on the activity.

A portfolio that features a significant number of transactions and short holding periods, coupled with fairly active involvement by its owner can be indicative of a trade or business in buying and selling securities/DA's. When a taxpayer believes that a given disposition should be on account of capital and not income, the implication is that such a taxpayer is arguing that they disposed of a capital asset. Capital assets are defined by their ability to generate income through their use or simple ownership thereof, not by their ability to be sold at a profit at a later date. Therefore, securities/DA's that do not provide passive returns, such as XRP, are generally viewed as being less capital in nature.

Small Number of Transactions — Adventure or Concern in the Nature of Trade

The fewer transactions in which a taxpayer takes part, the more likely the activity is going to be viewed as on account of capital and not inventory. However, even this factor is not determinative: there are cases in Canada where the courts have held that even a single isolated transaction can constitute an adventure or concern in the nature of trade. The Courts are clear that this is a fact-driven exercise and that a given case can turn on the perceived significance of even a single factor. For instance, investing cash in a limited number of cryptocurrencies consisting of a small number of transactions, combined with a lengthy period of ownership, is more suggestive of the gains being characterized as capital gains and not fully taxable income. However, the exact same initial investment combined with a very brief period of ownership, perhaps a purchase of XRP in mid-August of 2017 and a subsequent sale when it reached its current historical high in December, looks more like an adventure or concern in the nature of trade.  It is also important to point out that most if not all cryptocurrencies do not have the potential to earn passive income, such as dividends or interest payments, like stocks or bonds and prima facie do not resemble typical capital assets. While not determinative on its own, this generally means that the only way to earn income from many cryptocurrencies is to sell it at a profit, which is simply one factor that may favour a taxable income characterization in a given case. Other activities such as mining or running Codius Nodes to earn a return or claim tax exemptions (operational costs) are also significant factors to be considered.

Edited August 13, 2018 by PhiGuy

 

So, when the tax authority asks you, "were you expecting a profit when you purchased these digital assets" :

 

DSPWEjYWAAYJTD7.jpg

Edited by PhiGuy

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