Strategy

Basic principles

We created this strategy because we wanted something that is predictable, simple, and guarding us against a collapse of the crypto market. (Who knows right?)

We buy when the market is going up. We sell when the market is going down. Simple. We are never in a trade when there's a long or strong down market.

We do not predict or anticipate markets, just reacting to market trends. By doing so it means we will never be able to buy at to bottom or the very top. We will always perform somewhere in between. This is a safer method that works well over different timespans and coins.

Strong downtrends are very important for us, because this opens new opportunities for buying in again. Because we do not hold coins in down markets, we do not care how low it will go. As long as there are up- and downtrends, or market volatility, our strategy can make money.

Bull Bear Market Buy Sell
The red areas are marked bear markets. You can clearly see we do not trade during those periods. You are looking at BTC/USD May '17 to August '18. Check the separate trades here.

Performance

We tie our performance to market performance if you were to hold the coin. This means that in our backtests if the market grew 150%, we want to at least outperform this number.

Below you can see our overall performance over several years versus the market performance. Our BTC/USD performance might be very close to the actual market performance but consider that you had 100% market exposure. We on the other hand would only be exposed a fraction of that time, way less risky.

BTC/USD
2017-01-01 · 2018-08-09
Start price 973.35 USD · End price 6314.00 USD · 58 trades
  CoinBakers Managed Market
Profit

+821.80%

+548.68%
BTC/EUR
2017-01-01 · 2018-08-09
Start price 924.99 EUR · End price 5464.44 EUR · 54 trades
  CoinBakers Managed Market
Profit

+1,059.83%

+490.76%

All trades using GDAX/Coinbase Pro data running strategy JW_V4 V4.6.0.
BTC pairs exact dates 2017-01-01 00:00UTC · 2018-08-09 09:00UTC
Past performance does not predict future returns.

Universal

You can actually over engineer strategies, that would perform awesome on historical charts but only for that chart. We are very careful for this not to happen. We prevent this by keeping our strategies simple and react to universal situations. We do not hard-code edgecases and test on multiple timeframes and pairs.

Our backtest takes fees and slippage into consideration to better imitate real-life scenarios.

Risks

Our strategy is based on a number of indicators. We use multiple indicators to determine our buys and sells. Most notably is that we never buy during a down market. It also marks trades as high, medium, or low risk. Based on the risk we exit earlier or stay longer in a trade.

We only use exchanges that offer fiat (USD, EUR, etc.) pairings. We have to be able to sell and stay out of huge down trends. We do not trust USDT so for now we are only supporting CoinBase Pro.

If you consider buying a coin and keeping it, you have 100% market exposure. Everything that (may) happen is going to affect you. We therefore try to minimize our market exposure by focusing to get out as early as we can when we lose confidence. Once you hold a coin, you are in risk.

Continuously updated and monitored

Besides our risk management, we continuously improve the strategy based on new trends we see. We will push updates that would have performed historically better and help us with future trades. All our updates can be found in our changelog and the affect it had on historical trades.

Check out the changelog of our strategy.

What's the downside of this strategy?

As said before we will never be able to buy in at the bottom and sell at the very top. That's a beginners dream not worth chasing. Additionally, which is more of a downside for us, we are limited in the amount of clients we can serve before we will manipulate markets ourselves. Simply because we run one strategy.

We keep a close eye on our effects on the market and will limit the licenses accordingly to protect existing customers.

And why do we not trust the market?

  • Theft of exchanges' wallets
  • Downfall of major exchanges
  • Whale manipulation
  • Collapse of USDT
  • Banks and governments meddling
  • Major (technical) flaws found in protocols
  • Unexpected advancement of quantum technology, enabling brute-forcing your private key

These are the main reasons why we focus on limited exposure to the market. Any of these could happen at any moment and have major impact on price. That's why we sleep better at night having CoinBakers Bot guarding us.

Key strategy takeaways

  • Risk management first, profit second
  • Only fiat paired exchanges
  • Universally developed strategy
  • Limit market exposure to minimum
  • Continuously updated strategy

Questions?

If you'd like to try it yourself just sign up for our free trial. If you have any questions regarding our strategy just reach out to us in the chat, email, or our contact page.