The Trend is your Friend

Jesse Livermore, the legendary early 20th century stock trader, is the single greatest influence on my trading mindset. If you have not read “Reminiscences of a Stock Operator” and/or “The Boy Plunger” I recommend you buy and read them immediately. These books about Jesse Livermore’s life are entertaining and highly educational for everyone, trader or not.

One of the best tools for tracking a trend is the Ichimoku Cloud. An example of the Ichimoku Cloud applied to BTCUSD daily chart generates 7 trades (noted by markers at top of chart with 6 of 7 trades being profitable) over the past 18 months.

Different trading styles have different time preferences. Higher timeframe charts produce less trades per year. These higher timeframe trades are more profitable for less work. In these volatile times I believe you must be flexible enough to obey trends that are between 4H and 1D. Timeframes less than 4H are too noisy and over 1D can be too slow. Timeframes come down to personal preference and trading style. For me, having been a day trader looking at 15m charts, I can tell you I greatly prefer the higher timeframes for consistency of profits and quality of life.

“After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: It never was my thinking that made the big money for me. It always was my sitting. Got that? My sitting tight!”
“The desire for constant action irrespective of underlying conditions is responsible for many losses on Wall Street even among the professionals, who feel that they must take home some money every day, as though they were working for regular wages.”
Jesse Livermore

The key to trend trading is patience and persistence. I have lacked both the past couple of years.

Going forward I’ll be blogging more consistently on trends I’m trading.

Here’s a snapshot on a few notable assets:

Apple, a close above $374 opens target $430. However, $374 area could be firm resistance. Stop $345.

“Experience has proved to me that real money made in speculating has been in commitments in a stock or commodity showing a profit right from the start.”
Jesse Livermore

BTCUSD, in cloud and trending down. Neutral trend with bearish bias. Confirmed sell signal $8600. Triple top formed at $10,500.

BSVUSD, below cloud and trending down. Bearish trend with support near $150. Reverse trend at $170. Stay out till trend reverses.

“I did precisely the wrong thing. The cotton showed me a loss and I kept it. The wheat showed me a profit and I sold it out. Of all the speculative blunders there are few greater than trying to average a losing game. Always sell what shows you a loss and keep what shows you a profit.”
Jesse Livermore

TSLA, all time high with price 20% above Ichimoku Kijun indicator. This displacement between price and Kijun is a classic retrace signal. However, markets are irrational. I would be selling TSLA here to rebuy at Kijun support of ~$1,000. TSLA is a gamble for longs and shorts. It’s one of the most volatile and irrational assets to trade bar none in 2020 (including crypto).

AMZN broke a triple top and is now up 43% in 90 days since the Ichimoku cloud long signal at $2,008. Price looks determined to test $3,000 and I think it’s an ideal time to offload into that strength any shares you don’t plan to hold for 3+ years.

“End trades when it is clear that the trend your are profiting from is over.”
Jesse Livermore

To say these are unusual times in the markets is an understatement. Rarely has humanity had macroeconomic, political, health and cultural movements of this magnitude coinciding at the same time. Anything is possible in this environment.

Would you like to see more of these charts? What assets would you like to see tracked?

Posted on July 4, 2020July 4, 2020 by coinspeak 0

Mayer Multiple for Bitcoin Cash

Ask 100 market analysts when to buy or sell a Cryptocurrency and you’ll get 100 different answers.

Some methods of valuation are better than others. One simple method I like is called the Mayer Multiple (MM).

Trace Mayer is the man behind the Mayer Multiple but it’s on The Investor Podcast site where they’ve taken this metric to a new level. I encourage you to watch this video or visit the Investor Podcast site to learn how the Mayer Multiple works and in what scenarios. From a high level, the MM is used to gauge if Bitcoin is over or under valued relative to price history. This is very helpful for knowing when to enter or exit positions especially in volatile, emotional roller coaster markets like Crypto.

There’s a also a MM Twitter account for daily updates.

Sep 30, 2018: The current Mayer Multiple is 0.90 with a $BTC price of $USD 6,606.15 and a 200 day moving average of $7,351.79 USD. The @TIPMayerMultple has historically been higher 76.75% of the time with an average of 1.53. Learn more at: https://t.co/9n0xlTWuNP

— Mayer Multiple (@TIPMayerMultple) September 30, 2018

However, there is no MM data for Bitcoin Cash. Bummer. I wanted to see the MM applied to BCH so I replicated the MM on Bitcoin Cash. Here are the results:

Link to Google Doc with data and chart here.

Zooming in on the chart using TradingView you can see a clear support in terms of MM. Note: TradingView is not 100% match to the Google Doc due to limited price history in TradingView but it’s close enough to use for our purposes.

The MM chart may look a lot like a price chart at first glance but it isn’t. The difference between a MM chart and a price chart is that MM is displaying an asset’s value relative to price history. While past performance does not guarantee future results if you’re looking for a metric to tell you if it’s a good time to buy or sell in strong or weak moves the MM deserves a place in your toolkit.

Posted on September 30, 2018September 30, 2018 by coinspeak 1

Today is a good day to buy Bitcoin

Bitcoin just enjoyed a “selling climax”. Like most climaxes people are not thinking clearly post coitus.

We are repeating Wyckoff cycles over and over. I believe the technical term is “Bitcoin is fractal like a motherfucker”.

Link to live chart below where you can play forward the realtime data on tradingview.

And this chart is especially hilarious because the price goes off the chart, literally. Follow the link and press play.

That’s an example of an accumulation zone and markup. These zones are getting bigger and bigger. We’re going to enter into crazytown soon. More info in the video below.

Posted on May 12, 2017 by coinspeak 7

$TWLO Gartley?

The Gartley Pattern: 70% of the time it works every time.

Buy at ~60 with tight stop maybe at 58. Sell at 64 to complete C. Buy at ~$58 with stops at $53.5 and hold for next leg up.

Posted on October 7, 2016 by coinspeak 2

$TWLO catching a wave

Possibly in Wave 5 of this structure. Price limited to ~$80 max before we’ll enter corrective phase.

Posted on September 28, 2016 by coinspeak 0

Breakout in $ILMN and $NOW

ServiceNow $NOW breaks out of Triple Top and resistance going back to January. Conservatively wait till 80 or $81 or build a small position today sub $80. Stop at $73.