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Bitcoin lends itself to traditional trading system techniques. This is a great market.

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 private private,

 Wednesday, November 8, 2017

Throwing out all traditional fundamentals, Bitcoin has proven itself to now be mature enough to be capitalized upon using traditional technical trading systems. Although still a little slippery for basic modeling, I have discovered the following. Utilizing a channel breakout model as a base, I then created a percentage based triggering system so that it would be somewhat adaptive with the market. Instead of price itself breaking a price channel to signal a trade I use a percentage based off a short average to initiate the event. There are only two optimizable parameters, the channel length and the percentage above or below the channel for long and short positions. Large money management stops are also used to allow the system to do it's best job, while providing some catastrophic coverage.


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35 comments on article "Bitcoin lends itself to traditional trading system techniques. This is a great market. "

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 private private,

 Thursday, November 9, 2017



Sounds like you can use a Genetic Algo to optimize on both channel length and percentage change above/below the channel to improve your strategy.


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 Alton Crooks CFA, MBA, Chartered Financial Analyst (CFA), Master of Business Administration (MBA)

 Friday, November 10, 2017



What trading platform are you using for Bitcoin trading


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 Rej R Yujel MBA, Currently seeking for competitive opportunities

 Sunday, November 12, 2017



Sweet..


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 private private,

 Monday, November 13, 2017



I am using MultiCharts and the cash index produced by the CME. The model went short at 7000 and back long again at 6100 and is still long no. I am using 100 point range bars for data it smooths out the price action by omitting time.


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 Pete Townsend, Founder & CEO at Norio Ventures

 Wednesday, November 15, 2017



Fantastic to hear this, was going through a related concept yesterday with a client, love the validation!


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 Rej R Yujel MBA, Currently seeking for competitive opportunities

 Saturday, November 18, 2017



Es Market had been great...


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 private private,

 Monday, November 20, 2017



The ES market has been a great vehicle for trading but as it has matured the range has tightened. The potential I see in Bitcoin is the heightened volatility, which is better for short term traders rather than investors. With the rollout of CME Bitcoin Futures this market will have the best chance every to live up to it's potential. Many can argue all day long about the legitimacy of Bitcoin but Pandora is of the box and there will be no turning back.


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 private private,

 Tuesday, November 21, 2017



I have provided the logic code for this system in another post. If anyone has questions please feel free to ask. I think when the futures market opens the personality of will change slowly into more of a reversion to the mean market, rather than it's current mini trending tendencies.


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 Dmytro Shchurov, JavaScript Frontend Developer

 Saturday, November 25, 2017



What's a difference to "buy and hold"? BTC is a special asset which does not need "techniques". ;)


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 private private,

 Saturday, November 25, 2017



Dmytro Shchurov Buy and Hold is called "investing" however "trading" requires much more work and the payoff of that work is typically many magnitudes greater than simply investing over the same time period.


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 Dmytro Shchurov, JavaScript Frontend Developer

 Sunday, November 26, 2017



But not for BTC. No shorts. Stable growing. I understand, that now everybody talks about BTC...


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 private private,

 Sunday, November 26, 2017



Dmytro Shchurov Yes shorts CME Futures contract - better get a "technique". https://cointelegraph.com/news/cmes-bitcoin-futures-market-could-give-teeth-to-bitcoin-bears


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 William Schamp, President/Quantitative Analyst/Educator - PRICEPhysics LLC

 Sunday, November 26, 2017



Mark - Any idea of when the futures symbol will be made available? I agree with you the safest and most profitable way to utilize Bitcoin will be in Futures trading not investing.


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 Igor Horvatić, Master of Ceremony

 Tuesday, November 28, 2017



What happens when the CME goes into volatility interupt and all other non regulated exchanges continue trading? Transfer of coins for arbitrage will be slow and losses might be substantial. It will be an interesting clash of the new and old world.


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 private private,

 Tuesday, November 28, 2017



Igor Horvatić Transfer of coins? Plan on taking delivery? I plan on just trading it in and out like e-Mini SP's are now - this is just up down betting actually. Like gambling but better is the way to think about it. They could have called it flip-coin maybe that would have made it more clear for people who are yet to understand you can make money by selling something you don't own. This is why the futures is so much better than Bitcoin itself, you can open a new short position without owning any Bitcoin and you can make money if it goes down. Confused yet?


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 Gregory Herron, Fund Manager, Forex Trader & Trainer at Outside the Box Ltd

 Tuesday, November 28, 2017



Looking to find the best Brokers / Exchanges to trade Digital Currencies as a Fund Manager and Day Trader. Any pointers would be much appreciated. I currently manage a fund and trade copying service. But looking to the future when fiat currency could implode or become less relevant.


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 Igor Horvatić, Master of Ceremony

 Wednesday, November 29, 2017



Mark Brown I'm talking arbitrage, most of the commodities have their main volume on CME so they are the authority on the price. This is not the case in crypto for now and CME's 7% price volatility limit is pretty low as for example just last night BTC went up 9%. Why would anybody sell on CME if the rest of the world is still going up? That means a lot of cash will be needed to be in unregulated exchanges (which I'd like to see stay that way) so traders could short there and stay long CME. No delivery, just futures price arbitrage problem. Also a new transfer takes at least 10 min so that puts a lot of risk on the arbitrageur. This is of course my view as I can't wait to see this experiment of trying to regulate something that in its essence is supposed to be unregulated.


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 private private,

 Wednesday, November 29, 2017



William Schamp Supposedly the CME was to launch first of 2018 and then I heard 2 week of Dec. Now I hear they're not ready yet "regulatory issues" so I guess there is no solid date yet.


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 Paul Ayoub, Technical Analyst / Trader

 Wednesday, November 29, 2017



Agreed with William, Bitcoin moving forward is a trading instrument for sure.

I like Gregory, am personally looking forward to adding this Futures instrument to my system traded portfolio.

If anyone is looking to jump the gun and do system back testing in the meantime; You can do so via the Bitcoin Real Index (BRTI.X) which is available via IQFeed.


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 private private,

 Friday, December 1, 2017



CME Bitcoin futures launch Dec. 18


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 private private,

 Saturday, December 2, 2017



Predictions on when this will fail? Thanks, David


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 private private,

 Sunday, December 3, 2017



David Lanman probably within five minutes of the CME futures contract launch.


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 Patrick Rooney, Product Marketing Manager at Trading Technologies

 Sunday, December 3, 2017



Yep, Dec. 18 under symbol BTC. I traded them in the CME certification (testing) environment last week. Looks great. Huge demand as you can imagine.


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 private private,

 Sunday, December 3, 2017



It could be used to back illegal transactions, which can be hard to do with large dollar amounts. Banks are under laws with regard to large transaction and disclosure. Thanks, David


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 private private,

 Sunday, December 3, 2017



David Lanman Ha! I lived in Florida where every bank big or small is involved with laundering drug money and the government knows it!. Our own government has nothing to back the dollars diminishing value except to enslave the next generations to pay debt.

Bank's don't go by any laws other than to enforce them on it's customers. Anyway Bitcoin is just the first of the total takeover of global currencies by the people themselves.

Everyone is fed up with banks, government and the families that control - that is why cryptocurrencies are on fire and I will add unstoppable.


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 Scott Boulette, Algorithmic Trading

 Monday, December 4, 2017



@Mark, I think you are spot on


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 Gabe Harris, Principal Natural Gas Analyst at Wood Mackenzie

 Wednesday, December 6, 2017



@David Lanman

The bank HSBC "could be used for money laundering" and the CIA "could be used for" drug trafficking to fund wars without permission from congress.

Not sure what we should conclude from the fact that X "could be" used for Y.


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 private private,

 Friday, December 8, 2017



Maybe there is not a conclusion to come to, but just the awareness and maybe you are already aware, yes? Thanks, David


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 Mike Elmore, Citadel

 Sunday, December 10, 2017



Most people are not aware at all. Stuck on the technology ideas when the whole bag is a social movement instead.


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 Mike Elmore, Citadel

 Sunday, December 10, 2017



If you look outside the US - acceptance/criticism is vastly different.


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 Yanling Ng, Presenting the QH API Ecosystem -

The API Store for Quants

 Tuesday, December 12, 2017



Gregory Herron Have a look at Lykke Corp perhaps?


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 private private,

 Sunday, December 17, 2017



I’d recommend using the dot com boom for your price modelling and prediction for bitcoin. Bitcoin has had enough hype that ordinary people are now putting in their savings to take advantage of the relentless appreciation. The bubble will burst. Not sure how you are going to model that point? This is now about the herd and non-rational human behaviour which is typically very very hard to predict.

More generally, the risk here is the inability to place a VALUE on bitcoin vs a price. You can’t eat it, drink it or make shiny jewelry from it. If doesn’t entitle you to a share of profits or grant a vote at an AGM. It is nothing more than a token you can swap with other people for what ever value they are willing to pay. There is no government or central bank behind it. It could fall to $10 and no economy would care. I would expect the price of bitcoin to be disproportionately sensitive to confidence news and subject to wild swings. This will limit it’s value relative to other assets IMAO.


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 private private,

 Sunday, December 17, 2017



As BitCoin hits 20k this reminds me of when the SP 500 was 200 how in the world could it go to 2000 we thought at the time. Experience is everything.


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 Mike Jurkash, --

 Friday, December 22, 2017



nice article, Mark.


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 Diane Tycangco, Top Equity Analyst & Trader

 Thursday, December 28, 2017



How and where would you buy bitcoin though?

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