Bitcoin Trading Strategies

Introducing the Virtex Bitcoin Exchange

Introducing the Virtex Bitcoin Exchange

virtex bitcoin exchange

Virtex is a bitcoin exchange that allows users to easily trade bitcoin and litecoin for USD and for Euros. The bitcoin exchange is the first cryptocurrency exchange to have started in the baltic states and is quickly emerging as one of the more trustworthy cryptocurrency exchanges. Virtex is based out of Kaunas, Lithuania and provides a wealth of knowledge, which is designed to educate users on what bitcoin and litecoin are, as well as how to utilize their trading system. For more information on the virtex bitcoin exchange, click here

Virtex also has an open API, which is how users can incorporate 3rd party tools to execute trades on their exchange. Virtex’s API is rather detailed and it provides everything that a developer needs to get started. Virtex’s bitcoin trading platform is extremely easy to use and it allow users to execute trades through market orders or through limit orders. A market order on the Vitrex bitcoin exchange works by executing a trade that is guaranteed to be filled, as it buys into the asks and sells into the bids. The limit order function of the bitcoin exchange operates differently and it allows a user to place a bid or ask at a specific price that they would like to buy or sell at. One of the best things about this bitcoin trading platform is that it allows users to trade both bitcoin and litecoin against the United States Dollar and the Euro, which allows for greater flexibility when deciding which fiat currency to trade against.

Virtex provides users with multiple ways to get fiat money on their bitcoin exchange, which includes 3rd party systems such as EgoPay, OKPay, Payza, PerfectMoney, and AstroPay. The bitcoin exchange also allows users to withdrawal fiat through the same processors, as well as through bank withdrawals and deposits. The ability to have different deposit and withdrawal options further illustrates how useful the virtex bitcoin exchange is. Not only can you trade, deposit, or withdrawal bitcoin and litecoin, you can do it rather easily with the payment processors.

Virtex is becoming a dominant force within the cryptocurrency industry and its leading an example of how to structurally set up a bitcoin exchange. They even have fool proof tutorials that explain exactly how users can use their bitcoin trading platform, as well as a complete educational section of their site dedicated to explaining the nuances of bitcoin. It will be interesting to see what else this bitcoin exchange will do in the future.

Utilizing 2 Bitcoin RSI Bots to Limit Risk in a Sideways Market

Utilizing 2 Bitcoin RSI Bots to Limit Risk in a Sideways Market

The bitcoin trading strategy we will be explaining today is a 2 bot bitcoin RSI setup. The reason why we are setting up two different bots to run 2 different bitcoin RSI crypto trading strategies is because we want to limit risk and to find out which set works better for the market conditions. We basically don’t want to put all of our eggs in 1 basket. This strategy is perfect for utilizing the trade channel bitcoin trading strategy, where you set up static roof in at the highest point in the trade channel and a static drop loss for the lowest point. This is meant for a sideways market with small fluctuations in price.

Bitcoin RSI Bot 1 – Shorter RSI Time Interval

Haasbot Short Bitcoin RSI Bot

So the reasoning behind Bot 1 is we want to start off with a short time interval. First of all, we want 10 hours worth of data, so that this is as accurate as possible. So, we will choose a time period of 5 minutes, which means that we need a bitcoin RSI data length of 120. The math behind this is 10 hours = 600 minutes/5 minutes = 120 data lengths or candles. We will leave the RSI values the same, as they work quite well. We do not need any safeties and the only insurance we want to use (optional) is the “Cancel Order after 1 minute” insurance.

Bitcoin RSI Bot 2 – Longer RSI Time Interval

Haasbot Long Bitcoin RSI Bot

So now we want to set up a separate trade bot for a longer time period RSI. For this, we will use the 15 minute time interval. We will also want to use 10 hours of data, so we will use a bitcoin RSI data length of 40. The math behind this is 10 hours = 600 minutes/15 minutes = 40 data lengths or candles. As with Bot 1, we will then want to use the “cancel order after 1 minute” insurance, so that we make sure our trade signals are executed in a timely fashion.

Overview

This 2 bot bitcoin RSI strategy is great for novice traders to get a feel for which trading strategy is best for the current market conditions. It is always important that when trading bitcoin, that we do not trade all of ones money with a single trading strategy, but if one wants to, they should use the trade channel set up in conjunction with this 2 bot set up, so that there is a bit of protection from sudden bitcoin market drops and rises.

We know that RSI is a great indicator for small price fluctuations and we understand that there is a risk of it prematurely buying in a down trend and selling in an uptrend. Thats why it is important to utilize the trade channel method to protect the bitcoin RSI method from getting out of position. Best of luck to your trades and utilize this strategy whenever we are in a sideways market! Remember, as a trader, we should do everything we can to improve our trades, but stay away from some of that technical analysis voodoo chart stuff.

Bitcoin Arbitrage Bot and You!

Bitcoin Arbitrage Bot

Automating bitcoin arbitrage is one of the most sought after features for a bitcoin bot. Fortunately, a bitcoin arbitrage bot has been added to Haasbot, so we can see what this bitcoin arbitrage feature can do. This type of bitcoin arbitrage is an internal arbitrage bot, so it will not work with multiple exchanges. The reasoning behind this, as stated on Haasbot’s website, is that there are security risks involved with cross-exchange bitcoin arbitrage and they don’t want users to be at risk of the software possessing the ability to withdrawal bitcoins. I actually agree with this as a customer and I like that they put security to a high regard.


bitcoin arbitrage bot haasbot bitcoin bot

Evaluating the Bitcoin Arbitrage Bot

Since this is an internal bitcoin arbitrage bot, it works by monitoring the prices of specific cryptocurrencies within a single exchange for favorable price differences. Once the price differences are favorable and above our threshold, the bot will then execute trades along the chain of currencies to generate a profit. This is all evaluated by the user configured base currency (or the currency they want profits in). For example, say my base currency is BTC and I have the currencies USD/BTC, BTC/DOGE, USD/DOGE. The bitcoin arbitrage bot will execute trades when it is profitable to Sell BTC for USD, Buy DOGE with USD, and then Sell DOGE for BTC, which will end up with a small little profit. It is quite simple to set up and it basically works by just letting it run in the background.

Exchanges for the Bitcoin Arbitrage Bot

The bitcoin arbitrage bot is useful on exchanges with many different cryptocurrencies and even fiat. For instance, there is only one path for this on Bitfinex, so the choices for this are limited on bitfinex. But Cryptsy is a good place to run this bitcoin arbitrage bot, as it has fiat, multiple cryptocurrencies, but their API can be super slow at times.

Overview

Overall, this feature is quite nice. It is nice to be able to run it at the same time as my trade bots. The bitcoin arbitrage bot feature is very unique and there isn’t another bot out there that can do this. While you will not get rich over night doing this, small little profits overtime can add up. The bitcoin arbitrage bot is useful on exchanges with multiple currencies and fiat options.

How to trade effectiently using bitcoin technical analysis

How to trade bitcoin efficiently using bitcoin technical analysis

One of the many way people trade bitcoin is by using technical analysis. Technical analysis is basically different techniques and methods to produce a financial forecast using the asset’s past performance. While many would argue that technical analysis is not applicable to bitcoin and cryptocurrency markets, they mistake bitcoin technical analysis for the “voodoo looking bitcoin technical analysis charts.” I will not be discussing or going over these “voodoo charts,” but I will show you how to use bitcoin technical analysis indicators to produce very strong and reliable trade signals. In order to show you how to use technical analysis to trade botcoin, I will be using Haasbot, which allows us to even automate our bitcoin trading strategies.

Simple Moving Average (MA) and Triple Exponetial Moving Average Indicators

For this illustration, I will show you how to use one bitcoin technical analysis indicator to produce Buy Signals and another bitcoin technical analysis indicator to produce Sell Signals. I will be using TEMA to produce the Buy Signals and I will be using MA to produce the Sell Signals.

haasbot trade bot TEMA bitcoin technical analysis

As you can see here, I am using TEMA at 30 minutes, with a Short TEMA-Length of 16, a Long TEMA-Length of 28, and I have only selected “Use Buy Signals” in Haasbot. I will go ahead and check the TEMA buy signals, by running a small backtest on the TEMA technical analysis indicator.
haasbot trade bot TEMA Chart bitcoin technical analysis

As we can see here, the results looks quite good, considering TEMA is a predictive indicator. If you want more information on how TEMA works, check out the TEMA page on the Haasbot Wiki. Now we want to look at MA for the Sell Signals.

haasbot trade bot MA bitcoin technical analysis

Now, for using Sell Signals, I will be using MA at 30 minutes, with Short MA-Length of 21 and a Long MA-Length of 35. I have also went ahead and selected “Use Sell Signals” for this bitcoin technical analysis indicator. Of course, I will run another small backtest to see how the indicator would have faired against historical data. If you want to know more about MA, check out the MA page on the Haasbot Wiki.

haasbot trade bot MA Chart bitcoin technical analysis

Since we are quite satisfied with the results, we need to see how both of these bitcoin technical analysis indicators would have faired, when working together to produce buy and sell signals. We will look at the last 48 hours of data of this.

haasbot trade bot TEMA MA bitcoin technical analysis

Based on these results, it looks like we have a very strong and robust combination of bitcoin technical analysis indicators. The two indicators work really well with each other to produce some very nice Buy and Sell signals, which is very visible on the chart above. The best part of this chart is that we are now positioned with a buy at roughly $370 and the market is currently rising from there, which lets us profit once the Long MA crosses below the Short MA. This puts us in a very nice position to take a nice profit.

Overview

While some people may not think that bitcoin technical analysis amounts to anything, this post shows otherwise. I personally don’t believe in those technical analysis “voodoo charts,” but I do believe in math and technical analysis indicators. It is important to keep in mind that the whole strategy of using technical analysis indicators is to produce strong signals, but not all of them will be profitable. Our goal is to produce more profitable signals than unprofitable signals, which this strategy clearly does. Overall, bitcoin technical analysis can be very useful for trading more efficiently, particularly within the very volatile markets of cryptocurrencies.

Using Bitcoin Trading Strategies to Catch the Bottom

Bitcoin Trading Strategies – How to Utilize Dynamic Drop Loss and Dynamic Roof In to Catch the Bottom

Today, I will be showing how I will be utilizing both the Dynamic Drop Loss and Dynamic Roof In safeties for the bitcoin bot software, which is Haasbot to catch the bottom of this bear market with our bitcoin bot in conjunction with our bitcoin trading strategies. The idea behind this bitcoin trading strategy is to have the Dynamic Drop Loss safety get us out of the market, when the price drops more than 2% over the course of 4 hours. This will basically get us out of the market, but we also need a way to get back into the market, aside from our indicator (which is Regression Slope Cross). In order to get back into the market with our bitcoin bot, we will be using Dynamic Roof In, which will get is into the market if the price of bitcoin rises more than 3% within the same time frame of 4 hours, which would signify a recovery, particularly at this point in the price. This is one of the best bitcoin trading strategies to use in a bear market in order to catch the bottom.

haasbot trade bot bitcoin trading strategies

Using the Dynamic Drop Loss

The dynamic drop loss safety works by evaluating the price of bitcoin as a percentage over time. For our specific bitcoin trading stragies, 98% at 240 minutes, means that if the price of bitcoin drops more than 2% within the course of 4 hours, then the bot will execute a sell, which is to preserve the majority of our trading investment while taking a small loss. The key to this is to get out before we reach the bottom of that particular dump. In this case, a 2% price drop over the course of 4 hours looks like it will work quite well in these market conditions, as it is noted as a “free fall” or “falling knife.”

haasbot dynamic roof in bitcoin trading strategies

Using the Dynamic Roof In

The dynamic roof in safety works by buying you back into the market when the price rises over X% over x time, which in this case is a 3% rise over the course of 240 minutes (4 hours). It is important to have the same time length as the dynamic drop loss so that it will work in conjunction with the dynamic drop loss. It should be also noted that a 3% rise in the price within the timespan of 4 hours would definitely signify a trend reversal, or at the very least a small uptrend as illustrated by our bitcoin trading strategies. The roof in price changes every 4 hours so it will follow the price as it goes down, as illustrated in the image below.

haasbot dynamic roof in bitcoin trading strategies

Overview of our bitcoin trading strategies

The whole goal of this strategy is to work in conjunction with our trading indicator. The trading indicator will generally trade well in these market conditions, but this is also a way to ensure that if there is a massive drop in the price, the trade bot will not buy back in until it has reached the bottom via either the Dynamic Roof In, or the trading Indicator, which in this case is Regression Slope Cross. This is great because not only will this set up try to find the bottom, but it will also resume trading through our indicator once it finds the bottom, so we can capitalize on the bounce that will be generated from trading at the bottom. I hope you enjoyed this post and we will write another post about more bitcoin trading strategies for different bitcoin bot software as the market conditions allow.

October 4th, switching to Regression Slope Cross for our Bitcoin Trading Bot

October 4th Update: Switching to Regression Slope Cross for our Bitcoin Trading Bot

Well, we now know that the $360 resistance level broke very easily and we are now testing $350, which requires a change in our bitcoin trading bot strategy. The weekend has just begun, which means fresh fiat cannot hit the exchanges until monday or tuesday, so those who want to buy coins as cheaply as possible. Given this, I expect the downtrend to continue until we hit the next resistance point and bounce off of it.

october 4th macd

Since we can assume the downtrend will continue, I am now going to use the bitcoin trading bot that I have been using this week and change from PPO to Regression Slope Cross. Regression Slope Cross is the most advanced indicator that Haasbot has to offer and it can be tweaked to work great in the mid term and short term. For the short term, I will be using Regression at 100 data length, or candles. 100 data length for Regression Slope Cross is great for very short term fluctuations and I am extremely confident that this will perform well in these market conditions. Once we do hit the bottom of this short term bear market, I will then up the data length to 300, in order to catch more mid term price fluctuations.

haasbot bitcoin trading bot regression slope cross indicator

As you can see, Regression Slope Cross has been doing very well against historical data of the last 24 hours, I will will go ahead and apply this indicator without any insurances for my bitcoin trading bot, because I am willing to take small losses in order to secure my position for the trend reversal that should occur at some point this weekend. I should get some decent profits and/or be able to secure my fiat amount due to the uncertainty and downtrend for this market.

Overview over the last 24 hours

Well, I had not anticipated that $360 resistance level would break so quickly, which resulted in the loss of roughly ~$2 usd (trading 1 full bitcoin) due to my inaccuracy and using the 15 minute PPO. Looking at the Bitcoin Wisdom charts, MACD-Histogram would have performed about the same, with very small losses. I can accept small losses in a bear market like this, because when you are examining the bigger picture, it is clear that a trend reversal is coming soon, unless ~$340 is broken, which means that we are in a new bear territory.

I wish you all the best luck with your bitcoin trades, and I know hope that this blog helps to show you how interesting and useful bitcoin trading bot software is. I personally love the fact that this bitcoin trading bot has secured my position during this downtrend and has only lost ~$2, which is absolutely acceptable to me. But anyways, have a good weekend and happy trades!

Update on the Bitcoin Trading Bot October 3rd

Update from the last bitcoin trading bot post

Has the price has plummeted, I decided that I want to profit from the volatility and find the new bottom, as we are testing $360, which is a new low for this bitcoin trading bot. I changed the PPO for the bitcoin bot I am using , to follow the 15 minute, so that I can catch the waves a bit quicker than the 30 minute. This will ensure that I am indeed going to “ride the waves” as people say, during times a volatility.

haasbot bitcoin trading bot ppo 15 minutes

So given these situations, my bots have actually gotten me out of the market at ~$371 and are waiting for confirmation to rebuy. I am quite please with this set up thus far and we will see how the market plays out once I have completed more trades. This bitcoin trading bot works very well with volatility for these indicators so it will be very interesting to see how this plays out.

haasbot trading bot

As you can see from the screenshot, both of my bots (minus the droploss bots) have sold above where the market currently is and they are waiting for confirmation on when to buy back again. Note: the regression bitcoin trading bot has been working a lot over the past week and has been protecting my bitcoin trade positions quite well in this extreme bear market. I am quite pleased overall how this bitcoin trading bot handles these situations.

We will see how the weekend turns out. I have feeling that $360 will be the resistance and I do believe it will hold, but I will make sure my drop loss is set to sell my bitcoins (if they are in that position) at $355 to make sure that I am out of the market as we reach a new low. I must say, that with this software, my trading confidence has been very high when I leave my computer, because I know that this bitcoin trading bot will take care of my strategies while I am away.

How can a bitcoin bot help you?

Well, a bitcoin bot is a tool, that can be used to automate bitcoin trades. These tools come in many different types, but I will demonstrate how effective a bitcoin bot can be for trading. For this blog post, I will be using a very unique bitcoin bot that does everything that you want it to. This bitcoin bot is called Haasbot, which is one of the most advanced bitcoin bots commercially available. But before we go over how I have been using this bitcoin bot recently, we must evaluate the market conditions.

Current Bitcoin Market Conditions

Today is October 3rd, 2014, so the current price of bitcoin has been in the $370’s. When looking at the 4 hour MACD, on bitcoin wisdom, we see that there appears to be a double bottom, which signifies that a trend reversal is coming soon. While this may be the case, it is Friday, which generally means that people will dump coins on the weekends, as people cannot deposit fiat on the weekends. Due to this, I anticipate that the price of bitcoin may try to retest ~$360. So with this in mind, we must set up a bitcoin bot to handle the scenario of a trend reversal and the possibility of a drop to the $360s.

4 hour MACD Bitcoin Bot

Our Bitcoin Bot Setup for this weekend

So now that we know we need to use some technical analysis indicators for handling a drop to the $360s as well as positive trend reversal, I will go ahead and look through Haasbot’s bitcoin trading indicators. It is clear that a RSI based indicator may not work for my needs, so I have decided that I need an indicator MA based. While using the MACD Histogram may very well be useful, it is also to be noted that almost everyone and their grandmother uses MACD Histogram, so I want my trades to be a little before their trades, as slippage may occur. Because of this I want to use PPO, or Price Percentage Oscillator. PPO works essentially the same as MACD Histogram, but with the difference that it uses percentages, rather than absolute numbers. So given these conditions, I will go ahead and set up my trades to follow the PPO at 30 minutes, which historically does well against historic data.

haasbot bitcoin bot ppo 30 minutes

So now that I have set up haasbot to use the 30 minute PPO, I will go ahead and try to protect my losses against a sudden drop below $360, if somehow the resistance at $360 breaks and then we are heading to a new low. I will use Haasbots price drop safety, which will automatically sell any of my bitcoins, regardless of the 30 minute PPO does. I set the dynamic price drop safety to sell if the price of bitcoin goes below $350, which would definitely be a new low, which is new territory. I feel confident that this set up will trade over the weekend, so we will see how it does. It just goes to show you how useful a bitcoin bot can be, especially when I am away from a computer over the weekend and I want to enjoy my life, while a bitcoin bot handles the dirty business. I will submit a new update on monday, based on how my bitcoin bot trades.

Welcome to the Bitcoin-Club Blog!

The bitcoin-club team would like to welcome everyone to our blog! This blog represents our place where we can post about bitcoin and bitcoin trading. We love bitcoin so much that we want to document out findings on different bitcoin trading software along with some bitcoin market news and other things like that. We are a group of bitcoin traders who primarily trade bitcoin against the US Dollar as well as other markets and altcoins. There is a lot of things going on right now so expect a lot of posts coming as things occur!