Glossary of Definitions for Trading

peter

It's important to understand what we're doing!

Alexander

Hi everyone! It's about to be good night for me because I want Coffee, and I have a feeling I am going to get a barrage of push-notice alerts on my phone.... Unless the cats wake me up first. That worked good on 1 trade a few months back.

I'll start off with my favorite trading terminology and that is: "Taking Profits"

It doesn't have to be huge amounts, but enough to allow for a profitable re-entry strategy and begin compounding a "percentage of equity" with each trade.

Alexander

The "DXY" is the US Dollar Index. This index represents the value of the dollar with 100 being the expected norm. Through crypto, many of us have learned about market caps and circulating supply vs total supply. The perceived value of most major assets are valued in the US Dollar.

The DXY is one of the primary correlation coefficients used by analysts and market makers

Alexander

Alexander when the DXY starts moving like a crypto instead of a stable fiat, then other markets can become unstable

josephcorey17

If you ever need assistance, we have a repository of trading definitions and strategies in our "Trading and Mining Section" that I've highlighted, cheers!

Alexander

josephcorey17
Thanks!
I'm going to have to spend some time going through the NFT sections.

Alexander

So We have most certainly learned something new today. Apparently, our current strategy of placing limit orders outside the chop zone of the price action is referred to as "Market Maker" (Picture from CryptoHopper)

Alexander

Back again with a link to a video that describes the power of Technical Analysis better than I can. These old lectures truly help to expose the essence of what we are trying to code.

Way before Crypto, and before computers and graphing programs or calculators, Analysts used to hand draw their charts. Similar to Architects. In the same fashion; there are common templates or "triggers" that can be used to make smarter and faster decisions.

With modern backtesting technologies, we can go through historical data to identify "perfect" trade opportunities, and then verify consistency across multiple markets and conditions.

For those of us who have been in crypto for a few years, you will get a good laugh at the 17 minute mark. Fundamentals are important, but some technical conditions cannot not be stopped.

Alexander

One of the difficult parts of developing an automated strategy is making it work universally across all markets. There are almost an infinite number of variables that can influence different assets relative to others.

The 2nd most difficult part is adjusting a model for multi-tiered end users. A strategy that works for a trader with $10,000 probably won't work as well with $100 once you start calculating fees, minimum purchase orders, and bid/ask variations in the depth charts/level 2.

Alexander

Some of the new triggers that we coded earlier today are popping up on SOL

Alexander

What does "Price Discovery" look like? Sol was a good example. It usually requires "breaking the algo" or pushing beyond the short triggers and resistance on multiple time frames. It looks like ALGO could put on a show for us pretty soon.

Alexander

When you hear people like Cathie Wood or Jim Cramer and other analysts saying that there are warning signs or that the triggers are flashing red... They are referring to highly engineered models that have been developed over decades.

Crypto is not immune to the stock market algos, and the stock market is not immune to the crypto algos. On a long enough time line, they become exactly the same. SOL learned this. I think some of these new triggers were from the Vanguard S&P 500 ETF.
VOO-DOO

Alexander

We recently discovered ways to code percentage based take profit triggers into Long-Buy orders. There is a chaotic crossing pattern coming up on SOL, so it will be interesting to see if we have already coded this instance for another trigger.

Alexander

Instead of the typical "candles & bars", we like to use OHLC4 on a baseline scale as our price indicator. This helps to buffer out unrealistic fills of highs and lows across multiple exchanges.

The volume is already built into the buffering code.

Alexander

It looks like ICX wants to push higher, but its facing some resistance from the previous batch of take profits that would have created a "sell-wall" above the last peak. I don't normally buy crypto, but I might have to pick some up on coinbase. Not trading any of my Flux.

Alexander

If you want to see something crazy, start market buying up to $1.632.

Alexander

Alexander a little late. The bar got raised.
Part of my initial hypothesis involved manually drawing "linear regressions" with built-in "standard deviations" to identify "trend lines."

Then it was a matter of 1,000's of mathematical experiments to get them to draw themselves.

Alexander

It looks like the Algos are going to push ALGO into another level of price discovery. It just needs a string push beyond the recent short triggers.

Alexander

SOL is making new All-time highs with a similar format. Most traders don't care for all of the fancy technicals, but the lines below the price action are going to be some of your "stop-loss raid" targets