Moment of Truth

The other day as bitcoin hit an all-time high of $19,800 I was struggling a lot over the decision to sell or not, especially with the understanding that my taxed on all these gains would not be nearly what I thought they would be.

The crypto exchange GDAX, which is owned by coin base just put Bitcoin Gold online for trading. As it was introduced it spiked on very low volume from $3,300s to a peak of $9,500. That's pretty amazing and someone I have been watching on YouTube actually recorded the action live and was commenting on it. Trading was halted and price opened back up near where it was originally, but has since continued to climb ever higher. Here's a chart, which does not show the price spike actually..

Anyhow, Since prices of bitcoin have been so extraordinary lately, I decided to go back and take a look at how bitcoin's most recent crash ended. Here is a chart of that:

If you look at the daily chart you can see that there were basically 3 parabolic run-ups. The first had one red day and continued on higher. The second had one larger red day, and quickly continued higher. There was a very tiny red day after that and some massive continuation, but then there was another tiny red day, followed by a big rejection day. In the following 3 days you can see that the last day was not able to close above the previous rejection point and was followed by a red day as price rejected a second time. That was a beginning of the end and realistically, a technically clear symbol as price could not make new highs this time on a crazy percentage run.

This time, Bitcoins gains are even larger this time than the last run, and we have some important information to look at. Here is the chart as of today, right now.

As you can see we have a crazy run up even for just the part of the year shown. I zoomed in to see the individual days clearer. You can see that the last leg of this run up was very parabolic and had a sharp correction. Two red days and a green day were spent deciding what the hell was going on. Keep in mind, that all this time people are calling it the top, and even I was saying this crazy shit can't continue like this forever and that it needs time to breathe.

This is the toppiest I have seen it look yet, and it makes the most sense because $20k is a psychological level, and the public has finally begun to notice Bitcoin, which is usually the smart moneys trigger to sell.

This year, since bitcoin hit the $10,000 range, it has been pumped on news outlets all over the world by experts that are saying it could go to $500,000 a coin by 2020. Keep in mind that every one of those people are all invested heavily in the things they are claiming will go to the moon. Not to mention, the Futures exchanges have finally decided to come out with a bitcoin futures contract so the biggest players can play. That is a lot of attention. I call this a moment of truth because the next few days could very much clarify the big picture and the next few months for bitcoin. If we get another double top near $20k, that could be the ultimate time to sell before an even crazier crash. My gut tells me that $23k will be an exit point, but that's just an intuitive guess.

Just today, the creator of litecoin said he liquidated all his litecoin to avoid the conflict of interest surrounding his connection to it. It makes sense, but hey, it's also up to $340+ from basically Zero, why the hell wouldn't he sell? Here's the chart:

If you notice, all of these charts are generally correlated. I did say that Etherium and Litecoin all looked like they were primed to breakout again, but they rejected. They all seem to react very strongly negative the moment GDAX caused that flash crash on the exchange.

It will be very interesting to see what happens. I think if we get a crash it will take a long time for things to meet new highs, but possibly a shorter amount of time now because the crypto market is so damn hot to millions of people right now.

Until next time.

P.S. Got my wisdom teeth removed today. A very resetting of consciousness type of experience, followed by a shitload of pain. Feeling a great deal better now only a few hours later. No pain meds yet, and hopefully none in the future.

Capital Gains Tax and Cryptos

Spent some time looking into it and found out that my possible tax burden this year for my regular income looks like it could be substantially less, which would be freaking amazing.

More importantly, because I bought my Bitcoin over a year ago, it will be considered a long term investment and be taxed at probably a 0% federally if my personal tax bracket is 15%, which it very well seems likely based on the standard deduction change for this year. That essentially means that ANY amount I sell the bitcoin at would be basically TAX-FREE gains (minus state income tax). That's fucking incredible. The next thought I have is, should I hold the other coins for at least a year as well?

The reality is, that even if I don't hold them a year, they will be taxed federally at 15% based on my personal tax bracket. Pretty interesting to know.

Potential options and thoughts.

with a few beers in me I am able to easily see that last nights post and the feelings surrounding them are based soley on the lack of progress I am feeling due to the financial undertaking that I set out on with trading. Yes, I acknowledged that in the previous post, but I say that because it has caused me to wonder how I would be feeling about my life without that concept at all. Would I love my life and be happy right now because I have about $50k of essentially free money just hanging out waiting for me to claim it, on top of the fact that my job is easy as hell and I love my wife and home? Probably, is my guess.

Today Stacey and I started watch the Anthony robins thing on netflix. It was a nice time until our moment got upended by visitors I didn't expect back so soon.

A few hours ago I went over the two possible options available to us if the currency investment pans out nicely and we take huge profits.

Assuming we get out and have $80k net profit after taxes, there are two options I see.

• put that money down on the house and lower the payment and thusly our financial obligations.
• Put that money in the Commodity markets, (Orange Juice, Corn, Wheat, etc...) of which I have been dying to do since I was 15 years old, and wait patiently over years for our money to grow with basically a guarantee..

If I pay down, or pay off the house, then the pros are that our financial obligations are minimal and we can save a tremendous amount of money every month. The con to that is that we cannot really grow a sizable amount of money because obviously, it will be in the house. If we put that money in the commodity market though, say $80k, then we can control 5 contracts of Frozen Concentrated Orange Juice, which has been my commodity of choice from the beginning. Hypothetically, if we buy 5 contracts of 15k lbs of OJ at $1.00/lb and it goes up 60 cents, that will be a $45k profit. that could take a few years of course, but a guaranteed growth is so much better than a possible loss of everything. If that 60 cent profit is realized, and we reinvest the new balance of $120k again making 60 cents of profit, that would equal a gain of $72k... That's fucking crazy. The new balance (excluding taxes) would be $197k. Reinvesting that with 13 contracts would give us a profit of $117k on another 60 cent/lb move, to bring the total balance up to over $300k.... in just 3 fucking trades.  Which yes, could take several years, but can you believe that? It sounds too good to be true. 

And all this time, we could still be learning the markets and trying to be successful penny stock day traders. It''s the best of both worlds besides the fact that I'd still be working my ass off to pay the mortgage every month. However, if for any reason we really need the money, we could liquidate part or all of the position and use that money on the house. It is something to think about regardless. The amazing thing is that I am fortunate enough to be in a position to even be considering this crazy shit. 

Bitcoin hit $19,377 today... Litecoin and Etherium both look like they are about to breakout to new highs AGAIN. 

The serious question I might need to be prepared to ask is: Would I rather pay off/down my house, or make a guaranteed return of several thousand dollars over time on that money, while still having the obligations of working and paying what I am paying?

Searching.

Who am I and what do I want?

I find myself unable to answer that right now. I am aware that I am a culmination of concepts and experiences working themselves out within a biological system, but, I am also aware that I have no drive to move in a specific direction, which is where the point of all of this is.

I was beginning to watch Anthony Robin's netflix thing called "I am not your guru", and it got me seeing some things. For one. I am living in so much fear and acting out of so much fear. I am in a cycle of distraction away from the things that scare me. I look for projects around the house to do because it keeps me from trading related things. I do them and lie to myself that they are important enough to warrant my attention over trading, all the while knowing I will get nowhere doing this.

But what do I really want?

I know I can't truly exist as someone that has a true sense of security. I don't think I can be invested and care about things without the desire for security regarding them. Do I really want to trade? If I look at my actions, no. When I was just going with it and on a positive run of winning days, sure, I had little problem getting up and getting to the market to take advantage of opportunities. But when my discipline started crumbling and I took some big losing days, I didn't even want to get out of bed. I knew when I woke up in the morning, that the resistance I was feeling that kept me tired and in bed was the same resistance every trader might feel, but the winners are separated by the fact that they push through it and do the work regardless. If I am honest with myself, I do not want to do the work. I want the work done for me. I do not want to spend hours upon hours scouring charts to get the real data on whether or not a pattern works, especially after paying someone $1,400 to teach me about it. But I know that the responsibility will always lie with me, for each outcome of my life.

I have faced the fact in the last few days that I am a passionless man. There isn't one single thing I have the earnest desire to do anymore. Hell, I'm not even interested in sex. I don't want to be bothered by it. I find myself jerking off out of the mere convenience so I can sleep. You know, it seems the only thing I have any sort of desire to do anymore is distract myself from trading. I am afraid to lose money, but before I can even lose money I have to backtest, and I am very resistant to that. I thought I needed a break from trading, but I don't know if that's true. I honestly don't know what I need because I don't know what I am about anymore....

I do not like people. I do not like myself. Genuine happiness is a sparse part of my day anymore. I seem to spend so much time cursing and being angry at things so easily now. I don't know how to find or get back to the place where I actually feel passion about going in a certain direction in my life, and all the while I am not passionate, I am watching myself slip lower and deeper into this slump.

Hell, before I started my drive home tonight I had some inspiration because I was watching Anthony on netflix, but along the drive home, I got zapped of it all and just felt like sleeping. I barely feel like writing this, but I am.

The only motivating pain I feel in my everyday life at this point, isn't coming from the actual state of my life and driving me to have better circumstances really, it's from noticing that I in fact don't care enough to pursue anything. That is what hurts, and that is the thing I do not know how to change. No amount of notes written during a glimpse of inspiration and truth ever seem to have a lasting effect on me. I see them, read them, and just feel like I don't give a fuck because I'm not there anymore. I keep hoping this will pass, but it also seems that I have started down this miserable path ever since I became interested in trading again... I feel like I am genuinely hating trading right now, which is crazy because I'm not even involving myself in it, only feeling the resistance to involving myself.

So who am I? I don't fucking know. I know all the things and concepts I am not, but I have no motivation to create myself outside of that. I'm just a program that doesn't understand itself right now. I don't even feel that financial freedom would solve anything because what good is freedom without a drive to express that freedom? What good is the ability to do anything you want, when you don't want to fucking do anything? What good is having all the stuff, when there is no feeling of accomplishment?

And really, I suppose that's the issue. I wanted to use trading as a vehicle to accomplish my goal of freedom, but I don't want it bad enough to life a finger. There is no contentment without overcoming something that provides a sense of progress. I can't find what is needed to move forward, and that only depresses me further. I truly am lost at the moment, and it might all be because I took on the path of something I truly don't have what it takes to pursue.

BitCoin

Just been thinking about the irrational exuberation behind bitcoins crazy parabolic run this year. Here are some thoughts.

My $590 investment in bitcoin is currently worth $17,000.... that's crazy. Anyhow, this mania is literally bringing to mind Tulip mania. I wasn't around for it, but I've heard it explained before. Part of me is wondering if $17k will be the all-time high, and then I am immediately saying "Tulips were not for any reason worth what they wen't for, but bitcoin... That's a currency that can absorb current market capital of fiat currencies world wide.

What has me feeling some anxiety, is that my current holdings in Bitcoin, Etherium & Litecoin are such that if the values merely Triple, I will be able to pay off my house. Saying "merely" sounds hilarious in speaking of an asset gaining 300%, but Bitcoin has gained over 1000% this year.

My initial thoughts in the previous months have been that like penny stocks, the lowest price asset will attract the most buyers, and thusly Litecoin has been the cheapest of the 3. I wanted to put $5k into litecoin alone, but Etheriums chart was primed for a breakout to new highs as it had been forming a wedge of lower lows against a ceiling it was struggling to break. I ended up putting $4k into Litecoin and $1k into Etherium. Etherium totally broke out 2 days later, and Litecoin followed suit as Bitcoin gained 60% in just a few days.

The massive move was scaring me as I felt it was moving too far too fast. When buying (or selling) takes place on such a massive level, the exhaustion usually leads to a swift collapse. In the case of bitcoin, these crashes have historically been bought up as investors see it as a discount to get in. They see bitcoin as a sure thing, and thus that mindset among the collective dollars becomes a self  fulfilling prophesy.

The huge catalyst in my understanding as to why bitcoin has been relentless, is that A) people who understand what bitcoin's potential is, are reluctant to sell. Just look at me. I bought at $590 and am still holding, so maybe there are not that many sellers? And B) the huge futures exchanges are actually going through with a Bitcoin Futures contract that will enable all the billionaire investors to get in on the action. The influx of capital (which is still very small compared to the dot com bubble) can drive bitcoin way way up. Who knows... For me, I missed the move in Litecoin from $3 to $70, at least I got in with a few positions at $20 and now $70 while it possible rockets up to the $1,000 mark. I feel that as long as Bitcoin remains stable at such high prices and at least gradually keep gaining, Litecoin can bring others to the mindset that it can do similarly, thus attracting their money. Bitcoin was once a $70 coin as well, and I think that is the thought that is driving the money into it.

The future of Cryptos will be a very interesting one indeed. I just hope I am not going to be the guy who had thousands of dollars completely evaporate and not taken the profit when he could have. I am so close to my target though... It will be difficult to manage my emotions through the future price action. We will see...

Bitcoin: $16,000 Etherium: $731 Litecoin: $317

I am so fucking sick of trading

Fucking just annoyed right now. over trading on a small paper account. Unrealistic behavior. Taking fucking losses on a stock that didn't bounce. Really fucking pissed off and feel like just fucking quitting. Goddamn it why didn't I just trade Orange juice when I had the money? Or buy fucking bitcoin at $170 when I fucking thought I should have.

Go fuck yourself.

Thoughts about trading, chicken before the egg sorta stuff...

Today on twitter a trader I highly respect posted a now deleted comment "The greatest lie ever told is to buy weakness and sell strength. The data does not reflect this and those who say it are showing you they are a bad trader" (Something like that)

There was a comment on there from another guy that said "It should have said buy supported weakness and sell resisted strength"

The original poster said he disagreed and that "If you are buying support that you can see that is also a fallacy".

Then the other guy asked him what his honest opinion was about Tim Sykes, Steven Dux, and Tim Gritanni's success doing just that.

He responded saying that he thinks it's "luck and experience, though Dux and Gritanni seem more systematic about it."

He then basically said that you can be lucky for a long time. And here is the rest of the conversation I was able to track down. Ya know, I had a gut feeling this might get deleted haha, I should have saved the entire thing while I had a chance to!

Anyhow, I was really happy to see this guy putting in his own two cents, because I completely agree. I have so much more to say about this, but I can't get it out right now. Something I will come back to hopefully soon.