You are on page 1of 13

Bitcoin Trading Tips

Copyright 2014 by Pro Bitcoin Trading.com All rights reserved. No part of this publication may be reproduced,
distributed, or transmitted in any form or by any means, including photocopying, recording, or other electronic or
mechanical methods, without the prior written permission of the publisher, except in the case of brief quotations
embodied in critical reviews and certain other noncommercial uses permitted by copyright law. For permission
requests, write to the publisher at: support@probitcointrading.com.

Page | 1
Bitcoin Trading Tips

Contents
Introduction .................................................................................................................................................. 3
Trading Market Tips (Bitcoin market) ........................................................................................................... 5
Trading Methods Tips ................................................................................................................................... 8
Trading Environment Tips ........................................................................................................................... 12

Page | 2
Introduction
Trading is a truly noble profession. Although many amateur traders have day jobs and attempt to use
trading to supplement their main income, if done properly, trading can provide the disciplined
professional trader a very high standard of living.

Bitcoin markets are unregulated, and by definition, extremely risky. Mitigation of that risk requires
market specific training, self-control and proper planning. The Pro Bitcoin Trading Manual is an
excellent means to get that specific training. To present an idea of the level of planning required for
trading, try for a moment to imagine the preparation involved for the job of a military bomber pilot.

The night before his bombing run, our pilot is busy studying. He is planning the route, checking the
weather, determining fuel requirements and calculating the weight and balance equations. He is also
reviewing the mission target data and potential obstacles. He then gets a full night of restful sleep.

The next morning he does his routine morning exercises and


eats a nutritious and energizing breakfast. After breakfast he
heads over to the airfield. At the airfield, he looks over the
aircraft, checks the fuel, the munitions, and then rechecks the
weather for overnight changes before securing himself into the
captains seat, ready to begin the mission.

If all goes as planned, there should be no surprises. Our pilot


flies to the designated coordinates, drops the bombs, and then
flies away. Only if unexpected elements arise will our pilot deviate from the written plan. If enemy
fighter aircraft approach, he will adjust his course and plans, to avoid being downed.

This is the comparable level of preparation necessary for a professional trader. The night before he
trades, he studies. He studies the charts and the market patterns of the previous day, week, month, and
year. He determines where we are in the various time frames for market patterns. The professional
trader then decides the plan for the next trading session. He knows in advance if he will be a buyer or a
seller during the upcoming session. Our trader then gets a full night of restful sleep.

The trader awakes the next morning, does his routine morning exercise, and eats a nutritious and
energizing breakfast. After breakfast he heads to the trading environment. At his trading station he will
check the computers, the internet connection, the printer and other devices. He then rechecks the prior
days market action this time including the overnight action and any news related to the markets.

If all goes as planned, there should be no surprises. The trader identifies the trading signal, enters the
trade as planned, and waits for the conditions and signal to exit the trade and take his profits. Only if
unexpected elements arise will our trader deviate from the written plan.

What are these unexpected elements? You hear about them all the time. They are the worldwide
news items about events which affect the Bitcoin markets. When the Cyprus banks were shut down,
Bitcoin soared. After China outlaw its banks dealing in Bitcoin, Bitcoin crashed. When major retailers

Page | 3
announce acceptance of Bitcoin, the price advances and when prominent Bitcoin individuals get
indicted, Bitcoin falls. These market moving news items are the analogy to the enemy fighter aircraft.
The professional trader understands that these enemies are out there waiting to strike, and our trader
does not allow himself to get into a position where he cannot get out safely.

There are elements of Bitcoin trading which normally are learned only from experience. The years of
trial, error, successes, failures, gains and losses are not easy to amass. We at Pro
Bitcoin Trading have put together this set of tips from our 15+ years of experience to
help you in your trading. The tips cover the three critical trading areas of market,
methods, and environment.

To achieve consistent success with Bitcoin trading, and other markets as well, requires
harmonized synchronicity between the trading method, the trading market, and the
trading environment.

Trading market tips are guidelines related to the specific market that you are trading.
We are exclusive Bitcoin market traders and the tips revealed in this section will benefit
all those who trade the Bitcoin market.

Trading method tips are guidelines related to the actual trading strategies themselves. There are many
trading systems and methods available and it can be quite confusing. But, whether you are trading
using traditional day trading techniques or long term trading techniques, the method tips will be useful
to you.

Trading environment tips are guidelines meant for the environment in which you trade. It is the physical
space where you are located while trading. It also includes your physical being; your body and your
mind.

We hope that you can benefit from the use of these tips, and as always, please read and understand our
disclaimer. Your use of any of the tips in this document and our liability is covered by the language of
our disclaimer.

OK then, lets get started.

Page | 4
Trading Market Tips (Bitcoin market)

Know the asset that you are trading

Just as with trading shares of stock, it is essential to understand Bitcoins before you begin to day
trade with them. Unfortunately, there are scam artists out there in the Bitcoin world running
similar ploys to the "pump and dump" penny stock schemes, so beware before diving in.

Just as stock traders read the Wall Street Journal and watch CNBC daily, Bitcoin traders should
make themselves aware of the events happening in the Bitcoin world. A good list of Bitcoin
daily news sources to start with is below:

Coindesk
The Genesis Block
Bitcoin Magazine
Cryptolife
Bitcoin News
The Daily Bitcoin
Bitcoin Examiner
Coinboard
Bitcoin Views

We have also found a neat website named Coinindex. It is a site which purports to list only the top
quality Bitcoin sites. It even offers warnings if there are any temporary problems with a site which it
recommends.

Obtain the best education and advice possible

Any time you are preparing to do anything worthwhile, it only makes sense to obtain the very
best education and advice possible. If you were planning to open a new business, you would
likely educate yourself on the industry, the product, and the potential competitors that you
would face. Therefore, you should prepare yourself in the exact same manner here.

Transfer your Bitcoins to your local wallet after each trading day

Bitcoin exchanges Inputs.io and Instawallet were hacked. Thousands of Bitcoins were stolen. It
may never be discovered whether this was an inside job or not, but if you had Bitcoins on these
exchanges, you were out of luck. Mt. Gox, the largest Bitcoin exchange in the world suspended
Bitcoin withdrawals without notice and then filed for bankruptcy. If this can happen to the
largest most liquid Bitcoin exchange, you know that it can happen to any other exchange just as
easily.

Page | 5
Always remember, these markets are unregulated and there are no federal agencies to protect
you. If you are not actively trading, transfer all of your Bitcoins from the trading exchange to
your local wallet daily. These transfers are free and only take minutes. You will have the peace
of mind knowing that your Bitcoins are safely stored with you should there be any problems
with your trading exchange. It is far better to be safe than sorry.

Sell First? - Buy First?

The answer to this goes back to the question, what are your goals for trading? This question is
asked and thoroughly examined in the Pro Bitcoin Trading Manual. If you are trading for money,
that is, if your goal is to make money, the technique best used is to sell first. That means,
transfer Bitcoins into your trading account to start with and make your first trade a sale of
Bitcoins. Once you have sold Bitcoin, you have remaining in your account the cash from the
sale. If the trade was to go against you or you were not able to cover the trade, you end up with
the cash in your account. You may not have attained your profit target but you will have the
cash which is your goal for trading.

However, if your goal is to accumulate Bitcoins, you should buy first, so that you end up with
Bitcoins in an uncovered trade. Again, it all depends upon what are your goals for trading. We
go into more detail about how to set your trading goals in the Pro Bitcoin Trading Manual.

Know Your Stops

In conventional stock and commodity trading, a Stop is an order you place in the system that
automatically executes when the market hits your predetermined target. Usually, they are
placed to limit losses and are also known as stop losses. Unfortunately, as of this writing we
have not found an exchange that trades Bitcoin which allows using pure stops. Therefore, you
have to monitor your open positions at all times. You must decide before you execute a trade,
what is the maximum loss you will allow if the trade turns against you. If that level is breached,
exit the position immediately.

You may set your mental stop losses any way you choose but a popular method is to use some
smaller percentage of the gain that you were expecting on the trade. If for example, you enter a
trade where the minimum profit target is 90 points, then you would set a mental stop at some
value less than a 90 point loss. The rational is why would you enter a trade where the possible
loss is greater than the minimum expected gain? Professional traders only execute a trade
when the risk/ reward ratio is solidly in their favor.

Page | 6
Bitcoin ISS Real Currency,
Currency Regard it as Such

When trading alternate currencies, traders sometimes have a tendency


t endency to treat the currency as
though it is play money. To some, itt just doesnt feel real as a dollar.
dollar Since
Bitcoin is not referred to as dollars, which most traders are accustomed to, it i
is understandable to overlook that .231. BTC (current price) is equivalent to
$184.80 (dollars).
(dollars). The decimal in the Bitcoin number, being three places to
the left, makes it appear that the amount of currency you are trading is a much
smaller amount;
amount it is not. Bitcoin is just as real as the dollar, euro, yen, peso, or any other
currency.

Do not be misled by the small relative number. You are trading Bitcoin which
wh ich represents real
value and real purchasing power. Some vendors are now beginning to to use the nomenclature
micro Bitcoins (mBTC). The
micro-Bitcoins he number .231 BTC will be shown as 231 mBTC,
mBTC thus, on a relative
basis it will be much closer to what we are accustomed to seeing in our currencies. 231 mBTC
just feels much closer in value to $184 than .231 does. With this new currency there is a
learning curve that we must accept in order to become accustomed to all the new
nomenclature.

Use Multiple Bitcoin Data Sources

Bitcoin trading
trading is too volatile
atile to rely upon only one data source. Ideally you want a local client
running on your computer as your primary platform that has access to multiple data sources.
sources A
browser based data source can serve as your backup source. We use Sierra Charts Professional
Trading Platform as our primary trading platform. It is very stable and highly customizable and
supports multiple Bitcoin data sources.

Our preferred backup data platform is Bitcoin Wisdom.


Wisdom. It is browser based, fast, accurate, and it
provides data links to many Bitcoin exchanges in multiple currencies.

There are several other web based data sources.


sources A partial list is:

bitcoincharts.com
clarkmoody.com
bitcoinity.org
oinity.org
Bitcoinwisdo
itcoinwisdom.com
m.com One of our favorite web based
bitcoinchain.com
rtbtc.com
bitdata.com
quandl.com
bitcoin-analytics.com
bitcoin analytics.com
bitcoinaverage.com
coined.com

Page | 7
Trading Methods Tips

Write Your Plan for the Day

Have a written plan for what you expect to see in the market session and how you plan to trade
it. Obviously no one can exactly predict what will happen but you can make a speculation based
on the identified prior trading patterns. Your plan may look like this for example:

Today is bar 7 going up. If we get to the 50% level above the base calculation mark, exit 30% of
the trade. If not, move the stop higher based on todays trading range.

Your plan is a set of actions based on expected market movement with alternate instructions for
outcomes other than expected. Again, based on your knowledge of the market, the prior day,
week, and months patterns, and what you have learned in the Pro Bitcoin Trading Manual, you
will be able to produce a very accurate daily trading plan.

Paper Trade

Paper trading is practice trading and we all know that practice makes perfect. Once you have
your accounts open and funded, you will have a burning desire to trade. This is especially true
after you read these tips or you read the Pro Bitcoin Trading Manual. Dont do it! For at least
five trading days, watch the markets, watch your charts, and pretend to trade. Actually go
through all the steps of a trade without executing an actual order including writing down your
trades. This will give you confidence and experience without risking real money.

Musicians rehearse in the studio before a live recording, actors have dress rehearsals before
going in front of a live audience, and doctors perform surgeries on cadavers before ever
touching a live human being. Professional traders practice their skill with paper trading before
trading with live money.

If you trade real money the very first day that you fund your account or immediately after
reading this manual without paper trading, you are taking an unnecessary high risk and you
will likely lose your money!

The ability to paper trade even though you can execute actual trades is what separates
professional traders from the amateurs who lose money. You do not always have to be trading
or always in the market. There are many long multi day periods when we do not execute any
trade at all. Your goal is not to trade but to profit.

Page | 8
Document Document Document

Write down EVERT TRADE EVERY TIME, even when paper trading. There are certain chemical
reactions which happen in the brain that help you to reinforce good behavior and avoid bad
behavior when you physically write down your trading results. Do not create a spreadsheet or
any electronic ledger. You MUST use paper and pen and WRITE your trades. You may create
the trade log with your computer but make all your entries in the log by hand.

The simple columns of your trading log are date, time, open / close trade (O/C), Buy/Sell (B/S),
Qty, Price, and Profit/Loss. Below is an example of a trading log:

Date Time Open/Close Buy/Sell Qty Price Profit


11/15/13 8:15 O B 4 425.00 -
11/19/13 12:00 C S 4 750.00 + 1,300

You should also keep an emotional trading log. How did you feel when you clicked on the trade
now button? Were you fearful? Did you think you were missing out on a move? Did you think
you were selling too soon? Keeping track of your emotional state during each trade will give
you valuable insight into your own psyche. You will learn to either trust or ignore your emotions
based on their correlation to your trading results. Professional traders know how their
emotional state affects their trading and they factor that into each trade.

Use Only One Trading System at a Time

Combining multiple trading systems is usually not a good idea. It is very likely that the different
systems signals and strategies are not compatible and any success in combining them is purely
chance. If you wish to combine the attributes of two or more systems, paper trade the
combination for an extended time and back test the signals over past trading sessions first.

At times, many systems effectiveness diminish for a variety of reasons. If you are documenting
your trades as required, you will immediately notice any falloff of profitability. It is then you
may want to consider using another strategy or a minor tweaking of the strategy that you are
currently using.

Page | 9
Never Trade Your Full Account

It is very tempting, when you identify a trading opportunity, to become overconfident. Quite
often it appears to be the perfect setup. Your thinking then goes something like this: If I trade
5 Bitcoins I will make 5 times more than if I only trade one Bitcoin. While this is a true
statement, you should not let your trade decision follow that track if you only have a 5 Bitcoin
account. Never trade your entire account. You could easily be wrong and lose 5 times more
than a 1 Bitcoin trade size. (See also live to fight another day below)

Do not trade with funds that you cannot afford to lose

Although this is listed as that last in the list of tips, this rule of thumb should always be first in
your mind regarding any type of day trading activity - never, ever day trade with funds that you
can't afford to lose. While there is certainly profit potential in this type of venture, there is also a
great deal of risk that is involved - especially in the beginning when you are still learning the
ropes. Therefore, you must be sure that you are not gambling with money that should otherwise
be used to pay your rent or other important household expenses. (See also Bitcoin is real
money)

Who Should You Listen To?

When learning any type of new skill or craft, who, would you rather take instruction from - a
newbie who had some good beginner's luck, or experienced professionals who have worked
successfully in the industry for a number of years, throughout a variety of different
environments?

When learning to day trade Bitcoins, there are several essential points that you must have a
thorough understanding of. These include the following:

Which techniques to use, and when to use them.


What type of charting system is necessary?
How to identify your entry points.
When to get in - and when to get out - of your trades.

We at Pro Bitcoin Trading teach you these skills. We fully believe in the expression give a man
fish, you feed him for a day; teach a man to fish and you feed him for a lifetime. Our goal is to
teach you how to fish.

Page | 10
Live to fight another day

We are reminded of an old expression which says, He who fights and runs away, lives to fight
another day. There will always be markets. There will always be opportunities to make
money. Do not feel you have to constantly be in the market. Do not feel you
have to be trading into and out of positions. If a trade signal is not clear, dont
make the trade. One can become very wealthy making one good trade a day,
consistently. While trading, it is best to stop trading after you have a nice gain,
and especially stop trading after you have a loss. Go outside, get away from
the computer and come back tomorrow.

Page | 11
Trading Environment Tips

Computer Station Ergonomics

A proper trading station has to be comfortable, functional, and supportive of your physical well
being. We have located an excellent guide for proper computer ergonomics. The areas covered
in this guide are the monitor, keyboard, lighting, the mouse, and posture. Many helpful tips are
presented which when implemented will help to prevent injury and keep you in top shape for
trading.

The tires on a car are most important for handling because they are the part of the car that
actually touches the road. In trading the parts of your body which touch the computer are your
eyes and you hands. Our eyes are overworked. Weak and tired eyes are caused by wearing
glasses, contacts, artificial lighting, computer monitors and the normal aging process.

Here are a few symptoms to watch out for that may mean youre suffering from digital eyestrain:

Red and or irritated eyes


Headaches
Dry eyes
Blurred vision while looking at the screen or device
Pain in the neck or back

We have located an excellent overall eye health program which helps prevent eye strain as well as
correct many eye disorders. It even comes with a small app which reminds you to turn away from the
computer at regular integrals using a small pop-up. The program is called Rebuild Your Vision and we
highly recommend this not just for trading but for your overall eye health.

For your hands we recommend using a hand grip tool similar to these. As
you sit at your desk waiting for the next trading signal, you can casually
use these throughout the day to help prevent many motion related hand
problems. A side benefit is that you will develop a very commanding
handshake. You can find these at sporting good stores or online at
Amazon.com.

Also in general, you want to do some form of exercise and movement. Every hour, on the hour, get up,
walk around, and do knee bends, lunges, jumping jacks, sit-ups or stretching. You will be amazed at how
this will improve your overall health and your ability to focus while trading.

Page | 12
In our office, we have one of the over the doorframe pull-up bars. Throughout the day we use it to do
pull-ups and stretches. We use it to just hang and stretch the arms to relax. You can find these also
online at places like Amazon.com. We also have a jump rope. It is far too easy to become sedentary
and inactive. You must work to avoid this by having at hand the tools you need to easily overcome the
inactiveness.

Avoid Distractions

Finally you must constantly work to avoid distractions. Trading is your profession and you need
to stay focused on the task at hand. Avoid having your trading station in an area where you are
prone to distractions like the television, game consoles, washing dishes, etc. I know many
professional traders who trade from home. Because they work at home, often their friends and
relatives do not hesitate to call on them for favors during the day. They get calls to run errands,
to pick up kids from school, and to do all sorts of things. I have been asked to babysit, dog sit,
wait for a repairman, and pick up others laundry. You have to remind your friends that trading
is your job, and that you are just as unavailable while trading as the worker who is at an office or
the worker who is at a construction site.

Thank you for taking the time to read these trading tips. Properly implemented, these tips will improve
your health, increase your profits, and help you to avoid losses. However, there is so much more that
you can learn. There are specific trading techniques to use which master the predictable patterns of
emotional trading. The Pro Bitcoin Trading Manual reveals these techniques in great detail.

The reality is that there aren't any "top secret" Bitcoin strategies to riches - there are just good solid
technical trading techniques coupled with proper money management. These strategies have been
tested and used successfully by professional traders over decades of trading. And, while there are many
who may claim to be gurus, the best information will come from those who are actually following a
proven system to do so.

Any successful endeavor will require that you have a step-by-step track to follow - and ideally, one that
has been tested. Bitcoin trading is no different. In fact, a map that keeps you on track is even more
important in this arena, as this type of trading is currently unregulated, and there is presently no
regulatory body to protect investors. While there can be both advantages and drawbacks to this, those
who learn how to predict this market the right way, will truly be able to profit from it.

Take the next step, order the Pro Bitcoin Trading Manual today. You will be very glad you did.

I wish you much fortune my fellow traders.

Page | 13