Crypto Week 6 Summary
A extremely painful week
Object: BTC Perp (5x).
Amplitude of the move in the object: +16.26%
Return: -49.9% (before commission); -50.9% (after commission)
Narrative on the market:
This is the second week since Week 1 that we've seen Bitcoin rise. It has been an unbelievable week, both for BTC and for my account. My account dropped by half due to a mistake I made. Writing about this experience is painful, but I know that a 50% drop is normal for traders. Every trader faces significant setbacks. If I want to be a better trader, I need to listen carefully to what the market is telling me. As Soros wisely said: "Economic history is a never-ending series of episodes based on falsehoods and lies, not truths. The object is to recognize the trend whose premise is false, ride that trend, and step off before it is discredited."
This week, I made essentially only one trade—the trade I left open from last Friday. My position was a short with full capacity of my account and 5x leverage. The reason for shorting was that the price was rejecting the MATR80(see the yellow arrow in the chart), and my target was 53,000. The average price I shorted was 58,200.
Everything went well until around 4 PM at Saturday, when we went to a restaurant with my kids for an early dinner. We hadn't had lunch yet, and I was enjoying my sushi when I saw on the restaurant TV that Trump had been assassinated. I quickly checked the BTC price on my phone. It initially dropped but then quickly surged upward. When I got home, I rushed to my computer and was shocked to find I hadn't set a stop loss on that trade! By then, a new high of 59,850 had been reached, and my account had suffered a 50% loss. All I could do at that point was close my position, which I did.
I should have taken a long position afterward, but I wasn't in the right mindset to trade. So, I took a break from trading BTC for a few days, though I continued to watch the market. I saw BTC prices climb higher and higher. I knew the trend is false, but I didn't have the courage to ride it. I let it go. It's okay to miss a few opportunities. It's not the end of the world.
Next week is a new week. I may have lost my shirt, but I will carry on.
Current position: Flat.
