Hey, it's been a few weeks since ive posted here. Travel and other interests have taken up much of my time this last month. Trading has not been forgotten, in fact a direct consequence of my experiences nagivating the investor/capital allocator world has transformed how I think about currency markets. There are some new much simpler ideas (at least to me) that, from a first principles approach, builds a strategy that set-by-set that requires at no part any great understanding or ability to recognize patterns in the way my previous strategy inadvertently required. The simplicity was achieved by realizing what the currency market is NOT. Namely, that it is not and will never be a place where value is stored but rather a medium through which value itself flows on its path from one asset to another.
The full working set of ideas is explained entirely on bitcoin. No analysis for future trades was done. Ill likely update this blog later in the week with trade ideas using the new strategy.
Good Trading.
Analysis of the eur/kiwi, bitcoin and crude for the coming week. Putting together a few simple ideas, aligning some probabilities and we find the nearby trade ideas for these pairs. Bitcoin closed a 6hr candle in an s-wave that, after acknowledging the risks associated from the lack of confirmation, we placed a small position on with the 2x leverage our traditional account provides. Many defi brokerage platforms offer up to 50x perhaps more. I might place a position on these exchanges as well.
Good trading.
Building a single mental model that contains the full understanding of our strategy in a simple enough form to hold in our minds at once has proven to be difficult. I can't quite be sure if we fully intended this to have be our main goal for this year but looking back certainly it has been. Pragmatically there are other avenues we could have explored that would impact our trading results to a greater degree but we've always considered those to not be worth anything if we obtain a larger edge without a clear understanding of what we're actually doing.
The more subjective approach posited today as a kind of acceptance that we might not find that mental model anytime soon generated some a new understanding. Increasing the granularity of our tradable ideas by lowering the risk of less probable ones is a good approach that isn't discoverable if we continued searching where we have been. Looking at this small discovery it beckons the reasoning that in domains of high uncertainty no abstractions can exist that provides any understanding of them. If it were possible the uncertainties would not be uncertainties. True uncertainties cannot logically generate abstract explanatory models and therefore the answers must be assembled as you go. Could be? Possibly.
Good Trading.