While Bitcoin is going to a bubble zone, and many dummies are still sending their money to exchanges buying BTC, smart traders are already in BTC since $120 and they are looking for a moment to take profits.
Once they start taking profits, BTC growth will slow down and then as usual, we will see a double or tripple top with extremely high volume, before Bitcoin will go down hard.
I don't know how deep it will dive, it's unpredictable now, but markets always go down after they were pumped hard. Now Bitcoin market is still bullish but it's very late bullish stage.
So people probably will find this manual useful when the bullish market will switch to bearish.
Before reading this manual, please read
Also please read the DISCLAIMER. Beware trading is a risk. Shorting at bullish market while catching up the corrections is much greater risk than a regular trading.
But using short trades you can benefit on bearish market if you understand what you do.
1. Move some USD to Margin Trade page, in my case I use 1000 USD to go short. I'm doing this on the retracement to prepare this manual before the trend reversal.
2. Wait for a clear pattern of the bullish trend reversal. I usually use or patterns and sell only after the second or third peak reached.
3. Go Margin Trade page and sell some Bitcoins slowly. Always use Limit order. Limit means you will only sell above the price you set. In my case I use limit sell order by 328.
3. If you see your understanding of the market conditions is right than sell more
4. If the price is still not going up on the 2nd or 3rd peak than sell more.
5. Just to show you my balance so far. When you sell, your unrealized P/L will probably be negative first due to the trading fee. It's the lowest at Bitfinex, 0.12% only. Your P/L will become green when price will go down.
6. Now it's time to set stop-loss orders. Always limit your losses. If you open your position at the right time and in the right direction it will go to profit zone fast. But if you are wrong, better let your stop-loss orders to limit your losses.
7. In my case I use Trailing Stop-Loss order by 3. It means that the price of stop-loss will be automatically determined by the exchange as the price of the latest peak + $3. Current peak is at 328.79, so my stop-loss point will be determined by the exchange as 331.79.
8. Some transaction was executed at 328.5. Somebody set sell order at this level and it was bought. So now you see my Trailing Stop order has changed its price to 331.5. And because I see my understanding is right, I sell more.
9. Now the amount of my short position is 5 btc, which is 1640 USD. I have only 1000 USD on the balance buy I use a leverage.
10. I'm increasing my short position to 6 BTC (~1968 USD). So far it's not profitable yet as the price is not going down enough, but I'm calm because I have set a stop-loss order. But as you can see it goes down slowly and my stop-loss orders change the price.
11. Price is going down more.
12. And more.
13. My trailing stop-loss orders are already changed to 329 automatically. So now even if stop-loss orders will trigger I will be with small profit.
14. Price is going down more and my profit is increasing. My stop-loss orders are moving lower automatically.
So finally my stop-loss orders were triggered automaticaly and closed my short position with aprox. 3% profit.
I did this short to prepare this manual on a bullish market. But one day a reversal will come for sure and that time you may find this manual useful.
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