Efficiency is the key to the cash vaults in the crypto currency markets.
The more steps that you can eliminate in the process of executing your trades – the better.
However, novice traders are anything but efficient. In fact, their every move adds more convolution to the process of trading.
Where only two steps need to be taken, a novice trader will take one hundred and two steps.
This group of traders believe that trading ought to be complicated – so they create an entire list of unnecessary steps and useless routines in order to fulfil this belief.
This is a physiological defect that steers the most novice traders into over complicating a process that is as simple as buying low, and then selling high.
So, essentially, the majority of traders in this market (novices) believe that trading is ‘supposed’ to be difficult – so, in line with is belief, they create a bunch of unnecessary steps to fulfil this idea of how trading should be
I have spoken, on numerous occasions, about the perils of adopting the views of “the majority.”
Why? …Well, firstly, the ‘majority’ of people don’t make much money at all in this market, they lose money. So, in effect, following the commonly held views and beliefs in the crypto currency market is similar to walking into a book store and asking for the idiot’s guide to life, and then actually applying the principles found in that book your own life with the misguided hope of achieving long-lasting prosperity.
The ‘majority’ of traders in this market trade backwards and therefore lose more money than they could ever possibly make… and the kicker is, they blame the market.
For the most part, unskilled altcoin traders will use very particular words when the describing the crypto market. They always tend to refer to the market as a thing that inflicts torment and misery upon them, and this is reflected in the language they use.
They say things such as, “I just took a hit, in the market”… “I just got dumped on” … “I made a trade at the wrong time and got REKT”… “you have to predict the market”… “you can never always buy the bottom and sell the top”… “it’s a jungle out there” … “anything can happen” … “just made some money (lucky)”…. “just lost money, waiting to recover before I trade again”
This strain of trader does not find their way into the crypto market to win, they come here to lose.
These traders view the market as a taker, so they are forever treading on eggshells and walking around on their tippy toes, over complicating the most simple process in the world.
To them, the market is an inflictor of torment – and this belief is evident in the way these novices trade
The ‘majority’ (novices) have been fooled into using the manipulators buy signal as a sell signal… and the manipulators sell signal as a buy signal
So, almost by default, each and every move that amateur traders make in this market takes them further, and further away from the pot of gold.
This mentality spills over directly into how these traders manage their own funds.
The belief held by ‘the majority’ is that “to decrease your risk” you must mineralise the size of your trades with the overall idea being that, if you only trade $20 and you lose everything – you have only lost $20.
This create a false confidence that is more dangerous to a trader than anything else.
It is this ‘majority held wisdom’ that forces a person of reasonable intelligence to do something as ridiculous and illogical as to take $500 and break it down into several small pieces in order to make several small trades – with the aim of ‘limiting risk.’
This is bogus, and immediately puts a trader on the back foot.
By breaking down his $500 fund into several small pieces, what this unskilled trader is actually doing is diminishing his profit potential. Instead of working on accumulating a $500 position in an optimally priced coin, he breaks that sum down into twenty $25 pieces, and begins to trade ‘cautiously.’
This trader, let’s call him Tom, has completely failed at this point… but yet he carries on…
In his mind, he has it all figured out.
He is going to score a 100% profit on one $25 trade, which will take him up to a sensational $50. Then.. he is going to take that $50 and score another 100% profit – which will bump him up to an amazing $100.
This is his master plan.
But – the market itself has other plans…
You see, because of these ridiculously small trades that this person has committed himself to making, the time frame of the trades he can execute has instantaneously been shortened.
I mean, if you’re trading $25 are you really going to wait a month to withdraw $50 – of course not. So Tom has now restricted himself to only being able to partake in short-term opportunities – Manipulator Trap #1
So what does he do?
He sits around for the entire day, waiting and waiting to catch a coin while it has already started to pump, so what he is essentially doing is betting on the ‘continuation’ of price moves – Manipulator Trap #2
Then finally, after several hours, he spots what he has been looking for.
XYZ coin is now showing a 70% 24hr increase in price, and every twitter promoter is rapidly sending out tweet after tweet about this coin – so, he buys… Manipulator trap #3
(BTW, with each trap this trader walks into, Manipulators make money – piles and piles of money, because Tom isn’t acting alone… He is trading with the “majority.” And they are all walking directly into these traps with him – and the manipulators are very grateful indeed)
Back to the story…
After buying into XYZ Coin, Tom’s eyes are now glued to the screen.
He keeps switching backward and forward between his twitter tab and his Bittrex tab, trying to keep track of market sentiment (he isn’t even aware that he has already lost, and everything he does from this point onwards benefits manipulators more than himself)
… he sees on twitter “XYZ coin still has miles to go, x40 profit by Wednesday… easy.”
So what does Tom do? Well of course, he tops up his position and throws another $25 into the pot… he now has $50 worth of XYZ coin… Manipulator trap #4
But then… all of a sudden, the market begins to do what the market has always done since its genesis – it begins to punish all the novices one by one as the price of XYZ coin begins to plummet.
I mean, there’s only so many orders that manipulators can fit into the sell side for you to buy, and with so many small traders trying to “play it safe” with their small $25 purchases, manipulators will now move their attention to the orders placed on the buy side by, again, unskilled traders who thought they were being smart… Manipulator trap #5
One, by one, manipulators begin to sell their coins to the buyers who thought they were masters of the game because instead of buying at the market price of 43 satoshi, they placed buy orders for 40 satoshi – which is totally irrelevant to a manipulator who bought piles and piles of XYZ coin at 15 Satoshi.
And thus, the price begins to dip.
However, Tom is still browsing twitter… and all of the promoters are swearing that they “just bought more”…
Tom even goes to the XYZ ANN thread to gain further insight, and the promoters are still at work… “keep dumping into my buys, you will be pissed later when XYZ goes up 200%” – and after seeing this supposedly positive market sentiment, Tom decides to wait it out… Manipulator trap #6
He waits…. and waits… and waits… until his $50 depletes and vanishes into the ether.
But.. despite failing… this unskilled trader gears up to do the exact same thing again tomorrow, after all.. he only lost a mere $50 in his XYZ trade… he has an entire $450 stash left to play with.
And so he repeats this same routine until his entire $500 fund is no more.
You see, good trading begins with proper mentality. The very moment you veer off course and start to follow the majority of traders in this market, you put yourself in a position where manipulators can punish you from afar, in a variety of ways.
I mentioned earlier that novices view the market as an inflictor of torment. They see the market as a taker.
But, on the other side of the trade, you have manipulators.
Manipulators see the market for what it is, a giver. A conveyor belt of profit that allows a skilled trader to get into position long before the herd (the majority) arrives – and because there is a finite amount of tradable coins on the market, activity (volume) moves through this market in cycles.
This is why, when describing the market as a whole, skilled traders and manipulators use language that paints the market as a game
Just like any other game in the world, the market is solvable.
Just like any other game in the world, the correct strategy always wins you the game.
Skilled traders will never diminish their profit potential, because they know that if they find the right trade and accumulate a $500 position in that coin, then a gain as trivial as 100% instantly brings their fund up to $1000 in no time at all.
This is what enables skilled traders to make money up to one hundred times faster than the common market novice.
We have all seen how the market works.
A 100% gain in price today, can turn into a 1000% gain by the end of the month.
Skilled traders are able to participate in these long term opportunities, because they go in to their trades with sizeable amounts of money – therefore, when it’s all said and done, they are able to withdraw the largest amounts of money from their trades.
A skilled trader will use $500 to generate $1000 – with ONLY one trade. An unskilled trader may generate the same amount, but it will take him one hundred (perfect) trades to do so – therefore he is working much harder for less, whilst manipulators work less for more.
How efficient is YOUR strategy?