CryptoCred made a series of tweets providing some advice for traders based on his experience:
1. Learn to trade a spot Bitcoin daily chart before pissing about with margin trading on low time frames.
2. Cutting losers is hard. Start by not doubling down on losers/widening stop.
3. FTA is context-dependent. If you’re a seller at a huge D1 level on a bearish chart, don’t cut the trade at some M15 demand meme.
4. The best levels come from high time frame charts. Low time frame charts are often just a means of zooming in/refining what’s on HTF charts.
5. Most CT (crypto twitter) peeps aren’t interested in trading. Stats, trade management, entry triggers, emotions, etc. Enjoy the memes and take everything with a bag of salt.
6. Not all markets treat levels in the same way. Some will almost always break&pullback, others need momentum entries.
7. Levels are more than structures. You might have a nice 3-touch support turned resistance, but if that setup works 1/10 times in your market + price has just spiked a weekly low and the dump was in the overnight session with no vol., suddenly the level isn’t so great. Context.
8. Any decent trading system tells you when/whether to have a HTF bias and how to act on it.
9. Supply and Demand, Support/Resistance, Blocks, RTM, Pivots, etc. are all virtually the same thing and will lead you to the same levels. Mastering SR > barely grasping 10 variations.
10. Trade management deserves more attention. Bad management is what turns 10R into a break even stop out (if not worse).
11. Don’t move to break even for the sake of it. You’re a technical trader, not a p&l trader.
12. Most of the time you KNOW when a trade is a bad idea.
13. If you feel like you’re FOMOing in, ask yourself: if I get stopped out in the same candle that fills me, will I feel like an idiot? Good setup = you don’t care and would take it again.
14. If it looks too easy to be true, it’s probably a good trade.
15. Do business where there’s imbalance i.e. sharp, fast moves. That’s where the big boys are playing. That’s where the traders get stuck and forced to make a decision. That’s where technical & PA-based trading works best. Who’s offside?
16. Nobody on Twitter loses. Nobody cuts winners early/holds on to losers. Nobody forgets/hesitates to pull the trigger on a setup. Nobody risks too much on losers and too little on winners. Nobody takes a setup 5 times and loses only to avoid it the 6th time, the time it works.
17. Don’t switch your system up radically just because you’ve seen something cool. Be sceptical, test rigorously, and ask if there’s even a need to introduce something new. There usually isn’t.
18. A system means an actual system. Rules, diagrams, flowcharts. Not platitudes.
19. After enough screen time, you should be able to look at a chart and within a very short time ascertain if there’s a trade there. It should scream at you. If it doesn’t, there’s probably nothing there.
20. It’s okay to look at a chart and think “I don’t have a bloody clue.”
21. Confirmation is mostly bullshit. If markets were nice enough to kindly confirm and let you know when they’re about to rip, how the fuck would anyone lose money?
22. If you’re getting chopped up on low time frames, keep all your levels and go to a daily chart. Chances are, you’re trading hot air.
23. It’s totally normal to have a really nice level or structure and yet to avoid trading it because there’s nowhere logical to put a stop.
24. If you’re some price action prodigy trading 14 different types of market structure setups SFP rectangles and shitting money, you’re probably better off punting an automated moving average crossover strategy.
25. Most people will have the same levels as you. Yet very few make money. Focus on what separates the two groups: entry triggers, stop placement, trade management, risk management, etc.
26. Knowing when to avoid a level is just as important as knowing when to trade one.
27. Most things that aren’t already in your system or that can’t be easily systematised are a distraction: funding, books, big market buys/sells, CME gaps, futs contango/backwardation, etc. Just stick to what you know and what you can track.
28. Most people don’t have a clue.
29. You’ll probably manage winning trades too much and manage losing trades too little.
30. Focus on good trading as opposed to growing acc balance. You can make money trading poorly and lose money trading well. Over time, if you’re truly trading well, balance growth follows.
31. Instead of finding more winning trades, first ask yourself whether you can make more from the trades that you win already.
32. Never, fucking ever, move your stop loss in a way that increases your account risk.
33. Compounding is underused.
34. If you have a target and an invalidation, market entries outside of S/R are actually reasonable as long as you can take the heat/some drawdown.
35. Retracements don’t have to be into a level of S/R, sometimes they’re just a means of improving R:R on a momentum trade.
36. Obsession over precision/tight stops/minimum drawdown etc. will bury you.
37. If you’re flexing your p&l and how well the trade is going to your friends/colleagues/ex girlfriend, it’s probably time to take some profit.
38. Don’t try to catch the impulse move. By the time it’s impulsive, you’re probably too late. Let the impulse set the directional preference and inform you whether to sell the subsequent rally/buy the subsequent dip.
39. In a downtrend/presence of a bearish bias, resistance becomes stronger and support levels become weaker. In an uptrend/presence of a bullish bias, support becomes stronger and resistance levels become weaker. Levels don’t exist in a vacuum. Context is crucial (again).
40. If you’re worried that your stop is too tight, it almost certainly is.
41. Don’t bend the market to your R:R tool. It doesn’t care. The market doesn’t give a shit where your 0.1 dust Mex account has an order that, if filled, would make you $10. Trade the chart.
42. Trading a small account is nothing like trading a big account. Even in purely psychological terms: what’s the likelihood that you’re comfortable with several grand of risk taking the form of a market stop loss below some M15 rectangle on BitMEX?
43. There’s nothing wrong with demo as long as 1) you treat it seriously; 2) have plans/strict criteria for when you can ‘graduate’.
44. A good alternative is funding an account with money you can afford to lose and just taking low % risk setups. Management experience is KEY.
45. Some setups define the risk for you. Overthrow/overextension setups (over/under, tline overthrow, Quasifuckinmodo, range deviations, and so on) make stop placement logical and, more importantly, replicable.
46. You only need a couple of good setups for a trading career.
47. Manage a trade on the same TF that you entered it. E.g. if it’s a daily setup then wait for daily close(s) to manage. I’ve lost so much money puking HTF setups b/c of intraday noise.
48. In a D1 trade, intraday FTA is for management (rarely for closing the position).
49. Risk:Reward is only useful if the actual entry/target/stop parameters make sense. You can’t justify a trade on the basis of “good R:R” if it’s low probability trash with an arbitrary entry, random stop, and target that ignores key levels.
50. Don’t marry your original R:R.
51. You’re not going to build a career by punting a BabyPips candlestick cheat sheet on random time frames.
52. Candlestick patterns work best when they’re clear, simple, appear on HTFs, and where there’s some follow through in the anticipated direction after they’re formed.
53. Price will often react immediately upon hitting HTF levels. Sometimes it’ll shit straight away, but very often it’ll retrace and retest the same level. It looks like a straight drop on D1/W1, but traders who use the first reaction to move their stop very often get chewed out.
54. Stops losses are for i) fixing your risk; ii) reflecting new invalidation levels for an idea as price develops. They should be based on technicals (if a technical trader) and adjusted on technicals as well. No such thing as a free trade: BE stop = psychological cushion.
55. Buy/Sell indicators are mostly bullshit. Very low probability that you find something that has been rigorously tested and just prints money like that. The best indicators are either i) textbook oscillator, MA etc. stuff used correctly; ii) confluence tools e.g. Gainzy’s stuff
56. A chart is only as good as the actionable trade idea that it generates. Something might look “clean” and make you feel like you’ve got a really clear read, but unless you know which level(s) you’re trading, what the trigger is, stop, and target, the chart is just ‘art’.
57. Use sticky notes or some other visual reminder of important trade ideas/levels/biases/et cetera. For example, when a market breaks out it’s easy for everyone to say they’re buying dips. When the dip comes, very few remember their original idea. Make yourself accountable.
58. Stick to a handful of tools and structures for trading. Most technical stuff is buying where price rallies previously/selling where price fell previously, and then buying/selling the flip. Keep it simple. Too many diff. boxes/lines/indicators etc. = analysis paralysis.
59. HTF levels require patience. If you were selling an M15 structure you probably wouldn’t mind if it only shat 2-3 candles later. The same logic applies to a HTF chart: it’s not always going to offer an immediate and violent reversal. Higher TF = more time to play out.
60. A+ levels act as ‘magnets’ for price. Just like markets like to probe swing points, previous days’ highs/lows, ‘liquidity’, and so on, markets love to trade back to clear levels that jump out at speculators. Failure at those levels e.g. BTC 6k usually leads to huge moves.
61. Price is rarely going to present a uniform picture across all time frames. E.g. if the D1 looks bearish & retracing slightly, some lower time frame will (by definition) look bullish as price is going up. Let the HTFs dictate bias & use intraday time frames to act on it.62. Price can remain overbought/oversold on whatever oscillator for ages. This is especially true in markets with strong trends where all you get is impulse into consolidation into continuation in the direction of the trend. Price leads the oscillator, not the other way round.
63. Not every trade is a fixed 1R risk from the outset. You need to consider slippage risk. Trading a daily setup with a 40 pip stop as risk is NOT the same as trading an M5 rectangle on an exotic cross pair with a 5 pip stop ahead of news.
64. Price can turn on a dime. You might be a seller at a level and you see price absolutely fucking kamikaze pilot omegamoon green chadzooka ticks away from your level. That’s very seldom a reason to pull your order. It’s often the final FOMO leg before the reversal.
65. Long-standing trends are quite hard to reverse. If the instrument you’re monitoring on a Daily/Weekly is just shitting and has been on its arse for weeks/months, it’s unlikely that an intraday higher high will mark the bottom. HTF trends require evidence of reversal on HTFs.
66. The size of the move is related to the time frame that the structure comes from. If you’re selling an M15 trendline there’s usually no reason to target a 300 pip drop. If you’re buying a D1 level, it’s going to give more than 10 pips if you’re right. Tailor expectations.
67. Expectancy ((Win % x Average Win Size) – (Loss % x Average Loss Size)) is hugely underrated. If you trade several setups/time frames, they all have different expectancy stats. With enough data, you can tailor your trading to risk more on better setups/less on weaker setups.
68. Avoid doing too many hindsight exercises. The value of a setup is being able to identify it in real time. Unless you have a specific premise you’re testing or idea you’re exploring, 24/7 hindsight trading is nothing but a distraction. Mark up live charts instead.
69. Ha, 69. Goteeeeem.
70. Always have a trade entry checklist. HTF premise, setup name, time frame, R:R, risk, trigger, target, and so on. Going over trades that you lost is so much easier when you know where to look as opposed to playing TA Sherlock Holmes.
Hope you learnt at least one new thing!
Seems like there’s enough shit in my brain for Study Guide 2.0 this year?
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