Trading Strategies

Shares practical strategies, techniques, and risk management methods. By combining market case studies with technical analysis, it helps traders optimize decision-making and enhance profitability.

A $20 Million Loss Lesson: For Buying the Dip in U.S. Stocks, Just Remember These 'Three Dos and Three Don'ts'

"Losing 20 Million: A Painful Lesson on Bottom-Fishing in the U.S. Stock Market — Remember the 'Three Dos and Three Don'ts'" The author shares hard-earned insights after significant losses, concluding that while timing the peak is crucial for A-shares, bottom-fishing is key for U.S. stocks. The U.S. market's long-term upward trend makes buying the dip a core strategy, though it is psychologically challenging for many investors accustomed to A-shares' volatility. The article defines market corrections into three levels based on decline magnitude and duration: daily (5%+ drop or 2+ weeks), weekly (10%+ or 4+ weeks), and monthly (15%+ or 4+ months). Only 7 monthly corrections occurred in the S&P 500 over 20 years, each driven by macro events like rate hikes or crises. The core of U.S. stock bottom-fishing is a disciplined, batched approach. The "Three Dos and Three Don'ts" are: 1. Do plan batched entries; don’t make impulsive trades. 2. Prioritize "buying enough" over "buying cheap." 3. Use time-based batches (e.g., buying every few weeks) over price-based batches. For weekly corrections, a three-batch plan over ~10 weeks is suggested. For rarer monthly corrections, a 6-month plan with decreasing batch sizes (1/2, 1/3, 1/6) is advised. The strategy assumes the market’s long-term growth and relatively low volatility. The article also categorizes downturns: natural pullbacks, valuation-driven adjustments, and systemic crises (e.g., 2008, 2020). While black swan events are unpredictable, the key is to respond based on evolving realities rather than trying to predict them. The ultimate advice: stay engaged, assess risks as they develop, and remember that even severe crashes eventually recover.

marsbit9 ч. назад

A $20 Million Loss Lesson: For Buying the Dip in U.S. Stocks, Just Remember These 'Three Dos and Three Don'ts'

marsbit9 ч. назад

The Real Cost of Being One Minute in Prediction Markets — A Study on the Golden Entry Windows for Different Events

In prediction markets, the cost of hesitation is measured in minutes. This analysis of 2,023 on-chain trades on Polymarket reveals that the "confirmation tax"—the price paid for waiting to verify news—can be devastatingly high. The core metric is "Remaining Alpha" (1 - current price). For events that resolve to "YES" ($1), buying at $0.20 offers $0.80 in potential profit, while buying at $0.90 leaves only $0.10. The research identifies three distinct event types with their own profit decay curves: 1. **Sudden & Certain Events** (e.g., "Maduro arrested"): The golden window is the first 60 seconds, with an average entry price of $0.56 (44% Alpha). Alpha's half-life is less than 2 minutes, evaporating entirely after ~10 minutes. Strategy: Prioritize position over 100% certainty. 2. **Negotiation & Correction Events** (e.g., "SVB acquisition"): The decay is step-like. A 6-hour observation window existed with prices stable at ~$0.65, followed by a sharp price correction. Strategy: Look for confirmation signals (e.g., large smart money buys) rather than racing to be first. 3. **Priced-In Events** (e.g., "TikTok ban"): The event is highly anticipated. By the official deadline (T0), the price is already efficient (~$0.84), offering near-zero Alpha. Strategy: Avoid entering at T0; it's the finish line, not the start. The key takeaway: Time is an exponential function of money in prediction markets. A one-minute delay can mean forfeiting the vast majority of profitable alpha, turning a trader from a hunter into prey providing liquidity for others.

marsbit13 ч. назад

The Real Cost of Being One Minute in Prediction Markets — A Study on the Golden Entry Windows for Different Events

marsbit13 ч. назад

Dogecoin: How traders can react to DOGE’s possible $0.10 move

Dogecoin (DOGE) is trading near a key long-term support level around $0.10, which some analysts suggest could be a historical bottom. Despite a weak memecoin sector and overall bearish market sentiment, a short-term bounce is anticipated. This rebound is expected to target resistance levels at $0.0989 and $0.104, potentially triggering short liquidations around $0.11. However, the longer-term trend remains bearish due to lack of demand. Traders are advised not to open long positions but instead consider selling into any bounce, especially if Bitcoin falls below $62k, which could push DOGE to new lows.

ambcrypto21 ч. назад

Dogecoin: How traders can react to DOGE’s possible $0.10 move

ambcrypto21 ч. назад

Before Buying the Dip, Understand the Two Types of Market Drawdowns

The article distinguishes between two types of stock drawdowns: systemic (market-driven) and idiosyncratic (company-specific). Systemic drawdowns, like the 2008 financial crisis, affect the entire market and can be navigated with behavioral advantages such as patience, as markets tend to recover. Idiosyncratic drawdowns, such as the recent AI-driven sell-off in software stocks, require analytical advantages—investors must accurately assess whether a company’s long-term prospects remain intact despite market pessimism. Using FactSet as an example, the author emphasizes that investors must differentiate between temporary panic and fundamental erosion of a company’s competitive moat. Relying solely on behavioral strategies for idiosyncratic risks is inadequate; deep analysis is essential to avoid mistaking arrogance for conviction.

比推Вчера 12:59

Before Buying the Dip, Understand the Two Types of Market Drawdowns

比推Вчера 12:59

Earning $80,000 in One Day: How Top Players Turn Polymarket into Their Personal ATM?

In just under a day, a top trader on Polymarket, using the handle Bidou28old, netted $80,000 by exploiting the platform’s newly launched ultra-short-term prediction markets (5-minute and 15-minute intervals). The user is believed to be a quantitative trader or arbitrageur leveraging low-latency data feeds to capitalize on pricing delays. With only 48 total predictions, the trader maintained a remarkably high risk-reward ratio, often buying outcomes with only a 3-8% probability (e.g., betting on a Bitcoin rebound within minutes during a sharp decline). Even with 7 losses exceeding $10,000, the strategy remained profitable due to high payoff multiples—sometimes as high as 33x. The trader employed strict position management, placing large bets ($7,000–$19,000) on high-probability opportunities and securing returns between $4,800–$6,400 per successful trade. In one notable 30-minute span, the user executed three consecutive winning trades, earning over $18,000, demonstrating a high-frequency, data-driven approach. Activity was concentrated during U.S. evening hours (7:30–11:00 PM ET), suggesting either a North American night trader or a professional Asian quant operating during daytime hours. The trader focused predominantly on Bitcoin and Ethereum due to their high liquidity and volatility. This case highlights how sophisticated players use quantitative strategies and real-time market data to systematically profit from short-term market movements on prediction platforms.

比推Вчера 12:51

Earning $80,000 in One Day: How Top Players Turn Polymarket into Their Personal ATM?

比推Вчера 12:51

Should traders track FLOKI, memecoins to see where Bitcoin’s price will go?

The memecoin sector, characterized by high volatility and speculation, can serve as a leading indicator for Bitcoin and the broader crypto market. Analysis shows that memecoin rallies often precede broader market advances, while their declines can signal structural weakness. Currently, the correlation between top memecoin FLOKI and Bitcoin has reached a perfect positive coefficient of 1, a pattern last seen in February 2024 which preceded significant gains. Technical indicators and a recent 3.56% rise in memecoin trading volume suggest renewed speculative interest and potential early accumulation. Furthermore, an increase in stablecoin supply indicates more capital is available to deploy into risk assets, potentially acting as a catalyst for market-wide price expansion. In summary, memecoins often establish directional trends that the wider market follows, and current conditions suggest the market may be approaching a significant inflection point.

ambcryptoВчера 03:02

Should traders track FLOKI, memecoins to see where Bitcoin’s price will go?

ambcryptoВчера 03:02

High-Frequency Trading, $100K Annual Income: The Most 'Boring' Profit Myth on Polymarket

A user known as planktonXD (0x4ffe49ba2a4cae123536a8af4fda48faeb609f71) has generated over $106,000 in profit on Polymarket within a year by executing more than 61,000 predictions—averaging around 170 trades per day. This high-frequency, automated strategy focuses on exploiting small, certain opportunities rather than betting on high-risk, high-reward outcomes. The approach is characterized by market-making and micro-arbitrage: placing orders on both sides of the order book to capture spreads or profiting from mispriced options in low-liquidity markets. The largest single win was only $2,527, illustrating a disciplined, risk-managed method that avoids large drawdowns. The bot operates across diverse categories—sports, weather, crypto prices, politics—constantly scanning for pricing inefficiencies. Notable examples include buying heavily undervalued options in niche markets, such as esports matches or extreme crypto price movements, where probability is mispriced due to emotional trading or thin order books. For instance, a $16 bet on SOL falling to $130 (priced at 0.7¢, implying <1% chance) returned $1,574 during a volatile period. Key takeaways: The strategy highlights the power of compounding small gains, the necessity of automation and API tools, and the superiority of high-probability opportunities over high-risk bets. In prediction markets, the most advanced approach isn’t forecasting—it’s managing probability and liquidity.

marsbit02/11 13:06

High-Frequency Trading, $100K Annual Income: The Most 'Boring' Profit Myth on Polymarket

marsbit02/11 13:06

Making a Profit of $100,000 from 'Mosquito Meat' with 170 High-Frequency Trades per Day?

A quantitative trading bot, planktonXD, generated over $106,000 in profit on Polymarket within a year by executing more than 61,000 predictions—averaging 170 trades per day. Instead of betting on high-risk "black swan" events, it employed a high-frequency market-making and arbitrage strategy, focusing on small, consistent gains with minimal drawdowns. The bot capitalized on mispriced odds in low-liquidity markets—such as regional esports matches and crypto price predictions—by placing tiny bets on highly improbable outcomes that were statistically undervalued. For example, it achieved returns as high as 23,750% on a VALORANT match and 9,285% on a SOL price prediction by buying nearly worthless shares that surged during market panics or emotional mispricings. Key takeaways include the power of compounding small gains, the necessity of automated tools and API access, and the importance of probability management over high-risk bets. The strategy highlights that success in prediction markets lies not in forecasting outcomes, but in exploiting liquidity gaps and probabilistic edges.

比推02/11 12:36

Making a Profit of $100,000 from 'Mosquito Meat' with 170 High-Frequency Trades per Day?

比推02/11 12:36

Euphoria, Panic, and Crashes: Navigating 38 Years of Bull and Bear Markets, Volatility is the Inevitable Path to Wealth

Facing the recent extreme volatility in crypto markets, a veteran with 38 years of market experience and 13 years in crypto shares his perspective. He has witnessed Bitcoin’s rise from $200 to $75,000 and endured multiple drawdowns of 50% to 80%. Through these cycles, he emphasizes that volatility is the necessary “entry tax” in a secular bull market, and true wealth belongs to those who overcome emotional instincts, accumulate during panic, and hold long-term. He recalls buying BTC at $200 in 2013, only to see it drop 75% shortly after, and later falling 87% in the 2014 bear market. During the 2017 bull run, he experienced multiple sharp corrections. Although he sold during the fork wars and missed further gains, he re-entered during the COVID crash. In 2021, BTC fell 50% from April to July, similar to current sentiment, yet it eventually reached new highs. Key lessons: 1. For secular assets, doing nothing (HODLing) often outperforms timing the market. 2. Aggressively adding during sell-offs, even incrementally, compounds returns significantly over time. He advises asking two questions: Will the world be more digital tomorrow? Will fiat currency be worth less? If yes, continue investing. Time in the market beats timing the market. Manage position size according to personal risk tolerance, and never use leverage—it leads to permanent loss. He stresses the importance of having self-earned conviction (DYOR—Do Your Own Research), not relying on borrowed beliefs. While timing experts may occasionally succeed, expecting and accepting volatility is crucial. He continues to buy during dips, as he did in 2020–2024, and plans to do so again. Volatility is the price paid for long-term compound returns. Embrace it.

marsbit02/07 04:17

Euphoria, Panic, and Crashes: Navigating 38 Years of Bull and Bear Markets, Volatility is the Inevitable Path to Wealth

marsbit02/07 04:17

Is Your Crypto Journey Over?

"The author reflects on the recent crypto crash, drawing from 38 years of market experience, including involvement in crypto since 2013. Despite the current brutal and hopeless sentiment, they emphasize that such crashes are a normal part of long-term bull markets. Recalling personal history, they bought Bitcoin at $200, endured an 87% drop in 2014, sold during a fork conflict, missed further gains, and re-entered during COVID. Key lessons are to hold long-term, avoid timing the market, and aggressively buy dips to lower cost basis. They advise managing position size for personal risk tolerance, doing your own research, and avoiding leverage to prevent permanent loss. The author believes this is a panic within a structural bull market, similar to mid-2021, and is personally buying more crypto and digital art. The core message is that volatility is the price paid for long-term compounding gains in a digitizing world with depreciating fiat currency."

marsbit02/06 04:16