Trading the ETH / BTC Double Bottom
Here is a breakdown of how I charted a bottom and traded my BTC for ETH today.
I woke up to a text from Nick telling me prices 34k for BTC and $813 for ETH.
We proceeded to debate whether it makes sense to hold Alt coins, and I advocated for no, not until they show a positive trend or break a downtrend.
He went on to barrage me with the case for ETH. Credit to him for being awake at 4:00AM, and knowing what was coming. I owe a lot of my success in crypto to Nick. We make a good team. He’s knowledgable and also a bit speculative. I like to see things break trend lines now because I have a habit of buying too early.
Although I’ve been worried Michael Saylor would create a lot of BTC demand and that might kill Alts and send us into a bitcoin maxi scenario, it has never been Nick’s worry. That being said I have always liked trading BTC for ETH based on a good exchange rate, as I did a few days ago right a the bottom, but also wanted to see the market rebound from this terrible trend its been in (ETH vs. BTC) and seeing this when I woke up was enticing…
If you check my previous post “ETH/BTC trades” you’ll see my experience of what it was like buying the first bottom of the ETH/BTC exchange rate (the pink square above).
It was powerful!
ETH had real strength and the market handed me a quick win. When that happens it’s nearly always right to add or hold because the market is seeing what you see WHEN you see it. You got it right!
In this one, I was just a tad bit late entering and probably went a little lighter than I should have since it was likely going to be the right side of the W of the double bottom. Because I know BTC has been on a mad run and ETH seemed to be due for a catch up I could have put more faith in buying this hammer candle earlier. I was trying not to risk what I had told myself was just going to be buy and hold BTC for my lifetime, but the trade was just too good to pass up.
As you can see, my first order was at 8:16AM at a price of 0.02581 BTC per ETH. The .025 level is both important psychological number as it is sort of like a 1/4, but also it is 40 ETH per BTC, which is very good indeed (if you’re buying ETH).
2nd order at 0.0269, was just that it had already rallied nearly a whole number in 15 minutes so I just fired again, adding to my position.
Now the next two trades were based on longer term support and resistance line at the top of the middle of the W, the price of 0.02776. You can see I squared how I chose that number for my entry on the longer term trade.
This level was also given greater significance as it had been previous support as you can see here.
Here was the pic I took before the trade…
This is a 15min chart of what I was witnessing from the cockpit…
When it crossed my line, I tried to enter on a limit order, but the market moved too fast, so I had to fire a market order as well. I left my limit order in place though so if it came back this would likely be support and I could get filled again here. It did just that.
This was how I flipped 2/3 of my BTC to ETH today. ETH is still rallying as I write this, hitting $1,000. Very exciting to see Alts take off with it. SNX up to $9, DOT up to $10.50! I will be able to apply some more cash to UNI here tomorrow most likely. I took some cash off of BTC too so I could enter it strategically on future trades. Not sure if that was a good idea or not but I’m a bit afraid this could be a set up for a huge reversal tomorrow… something tells me not but there are “railroad tops” put in like this sometimes. In this case, I tend to think not since the price surge in USD/ETH was due to a bottom in BTC/ETH as well. It has been due for this for a long time.