Day-trading is a lot like sentry duty. You have to remain alert, even though a a large majority of your day is just plain boring. There's always the temptation to fidget, to do something for the sake of doing something. (I'll leave aside the other sentryesque temptation.) In a range-bound market where the trading is spotty, as Bitshares' was today, the temptation's worse. I admit, I succumbed to it - to the point where I was riding a loss until some YOLO -type buyer(s) came in at 5:30 PM ET.
>*Introductory Digression:* If you think my opinion is of any worth, it looks like Bitshares is still in its range of 850is to 880ish. If you're bullish on BTS & are planning to trade the night shift (Eastern time), I suggest laddering some bids below the high bid and wait for some dumper to come along. I myself think that Bitshares will go up once it breaks the range, but so far it's having a hard time getting above 880 and staying there. This latest run at 880 is the third in the last two days; the others fizzled or got choked off. Laddering below the high ask gives you some breathing room if the range holds.
### Fidgety Morning
This is the four-day chart I woke up to:
Last night, Eastern time, started off ugly. Bitshares actually sunk to 835 before it turned around and climbed back to the top of its current range. If you thing that the evening slam-down was due to manipulation, I sympathize. Things do get hairy sometimes.
If it were, then the manipulation part was the huge dump at about 5:30 PM that took a big chomp out of the buybook. The evening descent, which made for a double bottom, made its way to 835 on fairly low volume.
What was intriguing, though, was the climb afterwards - and the fact that the range held. As the six-hour chart from the same time shows:
there were two dumps that didn't affect the price that much - and were followed by a nice spate of high-volume buying. Still, I wanted to be careful so I started off the day with a 500,000 BTS short-sale order at 876 : one satoshi below a sell order of about the same size. Yeah, I was a dick.
And right after I placed my order, that other seller - possibly a short seller - cancelled his/her order and put it one satoshi below mine. In the trading world, this passes for professional courtesy :)
I started off a shorter because the buybook looked weak. But as early morning turned into mid-morning, it strengthened - so I moved the short order up to 886. And sat back to watch - and fidget. I started placing small trades for the sake of having something to do.
This is a bad habit, one that got me into trouble that I was lucky to extricate myself from. As said at the beginning, being a good trader requires building up the habit of staying alert during boring times. If you learn this the easy way, rather than the hard way like I did, kudos.
I started off with a small short, 100,000 let off at an average of about 870, which did work for me due to obliging dumpers selling into my laddered buyback bids in the mid-860s. But a second short of 80,000 at 874 saw me breaking even and switching sides. This is where I let my fidgetiness get the better of me. Encouraged by the short not working out, I went the other way...
...and placed a buy that was pretty dumb. Seeing a huge sell order of ~225,000 BTS at the then-low ask, I snapped up 200,000 of them. Yep: I bought a big haunch *at the low ask*. In a range-bound market, at the higher end of the range. Doing so was not smart. Thankfully, I didn't go all-out stupid: I also placed a 200,000 buy order at 863 and a 100,000 buy at 861.
I wanted excitement, and I was about to get it. Despite my hopes of the 200,000 buy egging the market on, or at least anticipating it, it went the other way. That turnaround made most of my afternoon....less boring.
### Manipulation?
But not at first. Here's the one-day chart as of noon:
At that time, the market looked pretty good. A chartist would peg the pattern as an ascending triangle, one that just needed some rocket fuel to bust above the range. But as this six-hour chart from three hours later shows:
that take-off was...not to be.
See those two red candlesticks on the right - the ones with the spikes in volume? They come after some feller like me tried to anticipate the rocket ride that never came. When I saw them, I knew it was time for "I Like To Lose". Having already gotten rid of ~50,000 of those 200,000 at about 876, I ruefully sold ~171,000 at 866. Since I had bought a little more, my net long was still ~38,000. Seeing the ill wind, I used almost all of my margin to ladder down by placing buy orders from 862 to 854.
Just in time for an even bigger dump, volume-wise, which blasted through all but two rungs of my ladder. This is what picking up nickels in front of a steamroller looks like:
as of not-at-all-boring 3:35 PM. Shortly afterwards, the final two buys were dumped into - and the sells were not close to being filled.
This is why ordinary spread-trading, even the laddered kind, is perilous. As long as the trend is sideways, it looks like easy money: buy low, sell high, rinse off your margin and repeat. Except...**when the sideways trends ends, as all of them do, you're on the wrong side of the market**. If that dump had triggered a cascade of sells, it would have been a race against "I Like To Lose" and a margin liquidation.
Even now, I'm wondering if those two big dumps were an attempt at manipulating the market. One of the tools of "professional courtesy" is known as "hitting the stops," in which a big short-seller dumps a big load onto the buybook to see if his dump triggers some stop-loss orders, allowing him to cover his short at a profit. (*This is why I do not use stop orders!*) If that were the motivation, that big dumper did not get his wish.
There could be another, more innocent explanation. Remember my foolish 200,00 BTS buy? Had I had the wherewithal, I could have justified it as a test of the market. For all I know, a real whale dumped those Bitshares in order to see whether or not the market would hold up.
Whatever the reason, I certainly had my share of "excitement" until 5:30 PM. I was margined up, all my laddered buys had been hit, none of my laddered sells had been, and the market went quiet again. Not the boring kind of quiet; not this time. A better word would be "eerie."
### Saved By The YOLO
At 5:30, though, my kiester was saved. Some YOLO-type buyer swooped in out of nowhere and snapped up a good chunk of the sellbook - including most of my laddered sell orders. What a relief! In a flash, my net long shrunk from about 500,000 to ~ 135000. Shortly after, another - maybe the same - buyer came in and shrunk it to a little more than 52,000. The rest went too except for some dust, and I ended an "exciting" day with another break-even after margin fees. Another free lesson that could have cost a lot, as shown in this six-hour chart I screenshot just before I knocked off for the day:
Saved by the YOLO...
...but if I hadn't been a dum-dum in the morning, I would have ended with a small profit.
### Lesson Of The Day
**Acting out of boredom makes you do dumb things, especially if the market's quieted down and no trades are going through. Better to cultivate the sentry's art of staying alert while doing nothing except watch.**
## Thanks (again) for reading! See you tomorrow with Day 3.
hiveblocks