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Bitcoin - Gold - Trading Strategy

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I believe that capital allocation is being shifted from Gold to Bitcoin (the new Digital Gold or Gold v 2.0). 


As the Bitcoin price increases the Gold price is decreasing. The charts show this story well.


I am long Bitcoin but maybe a good trade is to be short Gold at the same time. It is not a hedge against Bitcoin trade but a trade to maximise profits if the shift really is occurring then profit can be maximised in such a trade. This would be an aggressive trade and a risky one too but it is something worth considering. I think an even aggressive trade would be shorting Silver at the same time as being long Bitcoin. 


Very high risk trading idea but for those aggressive, ruthless and greedy traders it may be worth consideration. 

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I can see you're an advocate of bitcoin but I would be curious to your thoughts on ether and other cryptocurrencies? Some obviously serve similar purposes to bitcoin, but ether is quite interesting as it opens up a whole new host of decentralised applications and friction-less, automatically executed actions which would revolutionise a huge number of industries... 


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Yes, it will revolutionize lots of industries there will be a massive drive for data storage companies like Micron Technologies sales will go up. Amazon will be able to track the commodities they sell to value add. For instance, say they sold beef they could generate a QR tag to a young calf and link this tag to an Ether and using the  Ethereum blockchain network could track the calf right through to the point of sale as a meat product so with this information Amazon or any retailer could upsell their product. MMMMnnn food for thought there!  

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James, I think Ether is very interesting. It is obviously the 2nd biggest Cryptocurrency after Bitcoin by market cap. It has also just hit its all time high and is currently trading above $600.00. I did notice it hit around $628.00 earlier on. I have a smaller position in Ether than Bitcoin only because the trend is stronger in Bitcoin. However, I do think Ether will hit at least $1,000.00 very soon into 2018. 


I don't know if you have heard of the Enterprise Ethereum Alliance. Basically the likes of JP Morgan, Microsoft, Intel and IBM have got together to build business ready versions of the software behind Ethereum. Now these are not Micky Mouse companies. I think the likes of BP are using it and Ethereum is built on a new generation of blockchain technology and is optimised for software engineers. Its  real business application potential is absolutely huge. 


As the Ethereum network gains more traction and get more adoption then I can see the currency of the Ethereum platform, Ether, gaining in price. 


I think other Crypto's to look out for and are of interest to me is Dash, Ripple and Litecoin. I will leave more detail in this for another post at another time. 


I think Satoshi Pay as a company is interesting. It has teamed up with Stellar Lumens which has been rising in price recently. Satoshi Pay is looking at nano payment technology. 

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Interesting views. My partner works as a software developer for a global financial firm and ethereum is technology is definitely on the cards for adoption in some way. Some would say ethereum will outrun btc in the long run. I expect eth to have a very strong performance in 2018.

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I believe hargreaves offer an ethereum tracker which may be one to hold onto if you believe it is in for a surge. Ripple is an interesting one....my ears switched off as my partner rambled on about it...but there were some really compelling reasons why the future looked good for ripple.

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    • // Definition of code parameters DEFPARAM CumulateOrders = False // Cumulating positions deactivated DEFPARAM FLATAFTER = 210000 // Prevents the system from creating new orders to enter the market or increase position size before the specified time noEntryBeforeTime = 080000 timeEnterBefore = time >= noEntryBeforeTime // Prevents the system from placing new orders to enter the market or increase position size after the specified time noEntryAfterTime = 160000 timeEnterAfter = time < noEntryAfterTime // Prevents the system from placing new orders on specified days of the week daysForbiddenEntry = OpenDayOfWeek = 6 OR OpenDayOfWeek = 0 size = (2000/400) + ROUND(STRATEGYPROFIT / 800) // Levels 0% and 100% if OpendayofWeek <> 1 then L0 = DLow(1) L100 = DHigh(1) elsif OpendayofWeek = 1 then L0 = DLow(2) L100 = DHigh(2) Endif GRAPHONPRICE L0 GRAPHONPRICE L0 + -23 COLOURED (200,0,0) GRAPHONPRICE L100 GRAPHONPRICE L100 - 7 COLOURED (200,0,0) // Conditions to enter long positions c1 = high crosses over L0 + -23 //c12 = close > L25-5 IF c1 AND timeEnterBefore AND timeEnterAfter AND not daysForbiddenEntry THEN BUY size PERPOINT AT MARKET SET TARGET PPROFIT 84 //SET STOP PLOSS SL ENDIF // Conditions to enter shortpositions c3 = low crosses under L100 - 7 //c32 = close < L75+5 IF c3 AND timeEnterBefore AND timeEnterAfter AND not daysForbiddenEntry THEN SELLSHORT size PERPOINT AT MARKET SET TARGET PPROFIT 70 //SET STOP PLOSS SL ENDIF  
    • Yeah, only tested on a 5min chart so far. It does about 177 trades in 1 year and a quarter, so less than 1 trade per day on average