Spot-on market analysis and insights from the trading desk

What Are Some of the Biggest Problems with Crypto Trading Platforms?

After trading cryptocurrencies for almost half a year and coaching many others to do the same, I had realised that many new traders seem to face the same gripes about the limited trading platforms. This issue is extremely prominent if traders are used to other platforms such as forex or stock brokerages.

Here are some of the biggest complications about the existing platforms:

  1. Long waiting period for account opening, verification, or funding
  2. Misleading and unfriendly user-interface
  3. Expensive trading fees and wide spreads
  4. High charges by banks for fund transfers

When cryptocurrency was first introduced in 2010, only a handful of specialised exchanges offered trading services. Throughout the years, cryptocurrency trading grew larger in number and size. Comparing the existing functions and complexities of Forex to any other cryptocurrencies brokerages, there is still a huge room for improvement for cryptocurrencies. As of today, many emerging companies are out in the market, competing to resolve the problems consumers are facing.

While browsing the net, I came across many new promising brokerages, and I had a chat with some of them to find out more about where the industry is headed.

One of them is Cryptaw, a new brokerage that aims to provide simplicity and reliability for Bitcoin trading. When I spoke with the management, they told me that  “Singaporeans should not pay a premium for cryptocurrency.”

On Cryptaw’s website, which they have just launched this month, they have made some really bold promises which could potentially disrupt cryptocurrency brokerage industry:
– Direct SGD Deposit
– Low trading fee of 0.6%*
– Simple user interface
– Fast account verification within 3 working days

If Cryptaw is able to address the 4 big issues, it will make it a lot easier not only for new traders (of which many are still waiting weeks/months for their accounts to get verified), but also for existing traders who can benefit from a simpler execution platform.

*Original trading fee of 1.2%. User will be able to enjoy discounted trading fee with promo codes and referral codes. Users will be able to enjoy 50% off trading fee until 3 Aug 2018

[Note: This is a sponsored post by Cryptaw.]

Will the Stock Market Crash or Continue Going Up for Another 10 Years?

Since the crash of 2008, and the recovery which started in 2009, the stock markets (especially the US markets), have been on a steady uptrend.

Chart: S&P 500 index (weekly chart)

Many of us have heard about the 10 year cycle, where the market is supposed to crash once every 10 years, for example the Asian markets during the 1997 currency crisis, and the global markets in 2007 during the subprime crisis.

However, in 2017, we did not see any significant crash or correction, which have led many analysts to rethink the theory.

Now, it is 2018, so should we be expecting a delayed crash, or are we experiencing a structural change in the markets?

If we observe the supercycles of major human technological innovations, we see that each major wave of progress is driven by a major technological innovation, such as the steam engine in the 1700’s or the internet and IT advancements in the 1900’s.

And based on the cycles, we could be in the early stages of the 6th wave, which is going to be driven by the upcoming huge advancements in applications of big data, artificial intelligence, virtual reality, augmented reality, internet of things, and blockchain technology.

Source: The Market Oracle

This means that we could be on the cusp of a super bull market, if these technological advancements are able to create a quantum leap in productivity for businesses and a huge jump in the standards of living across the globe. All these would translate into stronger stock prices, which instead of crashing the market, would propel it to new heights.

However, there are also major concerns:

  • Unequal gains across companies: the major tech companies may soon dominate all industries via the application of new technologies.
  • High unemployment: If machines take all the jobs, what are humans going to do?
  • High debt and leverage of US and European economies
  • Political risks: clash of superpowers (US and China)

In summary, many retail investors are wary of entering the stock market now because it is at all time highs and has already “gone up a lot” since 2009, hence they are waiting for a “big crash” before going in. However, this big crash may not come if successful widespread application of new technologies and innovation are able to drive a quantum leap in productivity.

P.S. I talked about this during my previous FB live session here, and there are many new exciting topics that we discuss every week!
Official FB page: https://www.facebook.com/synapsetrading/

P.P.S. Next week, I will be heading to Silicon Valley to explore the latest technologies and innovation at some of the biggest tech companies, join me for live updates here:
My personal FB: https://www.facebook.com/iamrecneps
My Instagram: https://www.instagram.com/iamrecneps/

Cheers! 😀

3 Major Catalysts for Cryptocurrencies in 2018 – Time to Buy Now?

Since the highs in December 2017, Bitcoin and most cryptocurrencies have seen a sharp decline, and agile traders/investors have mostly exited to await better buying opportunities. This includes myself, and after cashing out my profits in early 2018 (after the double top reversal), I have been waiting for the past few months for a timely opportunity to get back into the market.

Despite the volatility, I am still optimistic for the long-term potential of Blockchain and Cryptocurrencies, hence it is important to know which catalysts will likely move the prices for 2018, and when is the optimal time to get into the market.

1. Increased Regulation

At first glance, this might seem like a bad thing, as many countries around the world (China, Australia, Taiwan, Philippines, US, etc) start to clamp down on Crypto-related activities, or impose some kind of restrictions and controls. And prices reacted to such news of regulation negatively as expected, with a prolonged downtrend lasting several months.

However, what most people don’t realise is that such regulation is actually a good thing in the long run, and necessary for Cryptocurrencies to become more “mainstream” and widely adopted. Which means that while we can expected prices to fall, it is also a good catalyst to enable us to buy these assets at lower prices in the future. Timing is key.

2. Institutional Funds

Once their is sufficient regulation and prices are low enough, institutional investors (hedge funds, asset managers, etc) are likely to come into the market. This is where the big moves are going to come from, as we saw from the dotcom boom. And recently, we have heard some news/rumours that big names like George Soros, Rothschild, Rockefeller, etc are starting to come into the market.

If we look at the graph below, we can see that a major trend is usually driven by institutional investors, which means that despite the meteoric rise of Cryptocurrencies over the past few months, it is still nowhere near a bubble, since the “real big money” from institutional investors have not started to pour in yet.

Imagine a future where fund managers and pension funds all include Cryptocurrencies as one of the asset classes in their portfolios, together with stocks, bonds, gold, etc. This will definitely create a huge demand for it, and push up prices faster than we have ever seen.


3. Scale & adoption

One major debate is whether Bitcoin (and other cryptocurrencies) can serve its purpose as a global currency with a stable store of value, and cheap & fast transactions. Currently, it is not there yet, and how fast it can get there will depend on how well the product can be improved. The volatility will naturally decrease over time as the market cap increases, but the speed and cost of transactions will depend on innovations and improvements from developers.

Is it a Good Time to Buy Now?

Personally, I have starting accumulating it for the past week or so, as evinced by the recent charts I have been posting. Looking at the chart below, we can see that prices have corrected from $19k+ to around $7k, where there is strong support, forming a potential double bottom.

And if the regulation starts to tone down and more institutional investors start coming it, this will be a pretty good confluence of factors to expect a further increase in prices.

 

I will be happy to continue accumulating as prices and fundamentals continue to improve. Stay tuned! 😀

 

How to Combine Price Action with Multiple Timeframes

One of the simple yet powerful techniques I use to allow me to quickly identify trading opportunities with minimal time and effort (typically 15 minutes a day), is to use this Excel table which combines price action with multiple timeframes.

To create this table, I observe the daily and weekly charts of various products (forex, stocks, cryptocurrencies, commodities, etc), and list down whether I think it is bullish or bearish on each timeframe. For the weekly chart, I only need to update it once a week, and for the daily chart, this takes me a few minutes a day.

Here are some chart examples:

This is the daily chart of the EUR/USD, and you can see that it just completed a pullback and is looking bullish. So under EUR, I mark it as bullish. For most products, I always benchmark them against the USD for easy comparison.

 

This is the weekly chart of the EUR/USD, and you can see that it is also very bullish, and rebounding off a large trendline. With the alignment of both the daily and weekly trends, this make the EUR/USD a very good long trade to be in. And since the GBP is also weak, going long on the EUR/GBP is also a good idea.

 

For the S&P 500, the long-term trend is bullish, but the short-term trend is bearish. In such a scenario, we will pass and wait for more price action. The goal is to take the best trades, not take as many trades as possible. Quality over quantity.

At the start of every week, I will be posting the updated table on the Synapse FB page, with the best trading opportunities for the week. For those who do not have much time to trade, this will be an easy way to find good trades without having to use any complex indicators/software/algorithms.

Follow-up on Bitcoin Short: When is A Good Time to Buy? (Bonus: ETH Analysis)

In my last blog post here, I called for Bitcoin to drop from its current $13k+ to between $8k and $10k, using the measurements of the swing counts.

Now, the price of Bitcoin has fallen below $10k, but I am not planning to catch a falling knife, so I will wait for the fall to end and the dust to settle, before entering the “post dot-com landscape) and buying up coins for cheap.

One of my readers also suggest an analysis for ETH, and I have posted the analysis here inside the “Live Trading Network”, which you can gain lifetime free access with just one click.

Thanks, see you soon!