Bitcoin price hits new high, but many are being eliminated? What it takes to survive in BTCFX

Hello everyone, a high-volatility market! I’m back from the fatigue of the eyes@xi10jun1.

In the past week, I finally broke through the 1,000,000 yen mark and Bitcoin reached an incredible peak of 1 BTC = 1,400,000 yen.

While there were certainly people who made profits, there were also those who began to exit. As you might guess, it was in BTC-FX.

*This column is designed so that half of it is free to read. Of course, it would be really encouraging if you read up to the paid portion (updated weekly for 400 yen per month, so about 80–100 yen per column), and I would be grateful if you could also subscribe as a tip!

This Week’s (Nov. 24, 2017 to Nov. 30, 2017) Results

First, as usual, here are the results. I will announce the change first.

Last week (through Nov. 23, 2017) assets: 56,022 yen
This week (through Nov. 30, 2017) assets: 58,562 yen
Change: +2,540 yen

Price movements have accelerated, and even with 0.1 BTC positions, profits and losses can rapidly amount to thousands of yen. Even small trades can yield decent profits, but that also means that delaying stop-loss even a bit can lead to a disaster.

Whether it goes up or down, the positions have become something you cannot let your guard down about.

Therefore, this time’s column is for those who want to survive in BTC-FX as exits begin to pile up.

Rising Exits

First, exits are appearing in many sectors, but the most serious one appears to be this here.

→【Nico Live】Nishikori FX 2017/11/29 Losing 28,000,000 yen in a single day with Bitcoin! - Nico Nico Douga(perhaps the most serious)

On Twitter and 2ch, even if not exiting yet, many people have suffered big losses in the Bitcoin world this week.

And almost all of the exits involved selling, i.e., short positions incurred losses.

In other words, this means the following.

Basics for Surviving BTC-FX

Starting with the fundamentals, selling or buying based on a “sense of price” is one of the biggest taboos in BTC-FX.

There was talk on Twitter and media that “Bitcoin is in a bubble,” and it had been reaching new highs, so the urge to sell makes sense. I was aiming for that too.

However, even so, you must not enter a short position merely because you think “it’s gone up too much and will drop soon” based on a “sense of price.”

If you take a short position, you must have at least twice as much justification as when buying.

I trade on a short-term basis, watching the Heiken Ashi candles, the time frame (which minute chart), moving averages, Bollinger Bands, Stochastics, along with order book status, volume, and technical buy/sell signals, and then trade carefully.

Only when a combination with the highest win rate aligns with the chart pattern do I take a position. Even with that, a stop can be hit, so trading by price sense alone is like courting death.

Next, when you open the trading screen, can you think, “I’ll skip today”?

If you’re determined to trade, even in the most difficult market of the day or hour, you tend to push trades and incur unnecessary losses.

If you can assess the market intuition and think, “I don’t understand today’s price movement; I’ll quit,” and close the screen, that is crucial.

I was like that at first, but I would always end up trading once I opened the screen. So I’ve learned techniques to quell my own momentum, like “Alright! Let’s go! Let’s make money!”, but these are surprisingly hard to master.

In BTC-FX, especially in short-term trading, being able to make this judgment is a strategy essential to surviving.

Free Summary: If the Pound is a Killing Currency, Bitcoin is a Genocide Currency! Remember this!

I haven’t written it explicitly, but risk management and stop-loss are obvious essentials. At a minimum, you must have these to avoid an early death in this world.

I’ve written this many times on Twitter: “If the Pound is a killer currency, then Bitcoin is a genocide currency.” Got it. “Bitcoin is a genocide currency.” Remember that.

Finally, while it may seem blunt to write such a column, in fact you’d be better off not doing BTC-FX at all.

So, this paid column will discuss future prospects.

Ending Corner 1: The Latest Tax Information!

The National Tax Agency’s site has updated the latest legal views on Bitcoin.

Here it is →No.1524 Taxation related to profits from using Bitcoin | Income Tax | National Tax Agency

According to this, profits earned from using Bitcoin are considered “miscellaneous income.”

So, profits from margin trading like mine are generally miscellaneous income. As I’ve noted in the Ending Corner before (see article on this blog →Tax return for Bitcoin margin trading (BTCFX): Is it aggregate taxation? Separate taxation? | Yutori Generation Investor jun), loss-offsetting doesn’t seem to be possible. I wish this could be addressed more.

Also, according to NewsPicks commentary by BitFlyer CEO Yuzo Kano (No.1524 Taxation related to profits from using Bitcoin - NewsPicks), if you buy Bitcoin for 100,000 yen and use it later to buy something for 500,000 yen, the 400,000 yen difference is treated as profit.

When you spend Bitcoin on goods or services, if the price of Bitcoin at the time of payment is higher than at the time of purchase, that profit is recognized as profit. So the following FANCY purchases using Bitcoin would also apply, so be careful.

※ Please note that laws and tax interpretations may change, which could alter the method of filing and paying taxes. Before filing, be sure to consult your local tax office or a tax accountant.

Ending Corner 2: Shopping with Bitcoin!

In fact, the overseas e-commerce site “FANCY” allows you to purchase goods using Bitcoin! It’s a bit costly for shipping, but there are stylish items you won’t see in Japan!

For how to use FANCY, this blog has a guide, so please refer to it.

→Guide to creating an account, registering, setting up, and how to purchase on FANCY | Yutori Generation Investor jun
→How to buy (pay with) Bitcoin on FANCY items | Yutori Generation Investor jun

※ This is the end of the free portion. The rest is detailed analysis and future prospects, so it is paid. If you want to read more, of course, you can also subscribe as a tip, which would be greatly appreciated. Thank you for your continued support!