Being a Hive User Gives You an Unfair Trading Advantage

in LeoFinance2 months ago

The Hive community both on-chain and on Twitter made a lot of noise yesterday about the pump in HIVE's price. When you're so heavily involved in a project from day-to-day, any small movement in the price hits home far more than if you've just got a coin sitting in a wallet.

My investment in BTC and ETH are larger than my investment in HIVE (in terms of coins - definitely not in terms of daily energy and focus). With BTC and ETH, a 20% uptick feels great. I look at something like a Blockfolio tracker or a Tradingview chart and get excited about the prospect that my coins are worth 20% more in terms of fiat.

With HIVE, it's far different. You're not just looking at a screen and seeing that your coins are worth more. You're looking at it from an entirely different persepctive.

When you're a full-time or even part-time Hive user, you feel each move to a greater degree because HIVE is your currency.

After weeks or months of making posts and seeing HIVE denominated around a particular price

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I put out this Tweet on the LeoFinance Twitter Account and called HIVE the most "trader-friendly cryptocurrency on the planet."

HIVE has extremely volatile price swings. It tends to settle down in certain ranges for long stretches of time and everyone forgets about the price. Then all of the sudden, BAM! Out of nowhere, HIVE rises 15-30% in a matter of hours.

It could be a tight supply. An illiquid market. A whale stepping in and accumulating. Market manipulation or all of the above... Whatever you want to attribute the run to, it doesn't really matter imo. I just enjoy the opportunities that it presents.

In my opinion, being Hive users gives us a built-in advantage over people who just trade HIVE. There is a subset of people out there who live on crypto exchanges and simply trade coins when the charts show them something they like.

Over the past few days, I've seen a lot of chartists come out and say that a breakout was about to happen in HIVE. Turns out, they were right. These aren't the people that say HIVE is going to $1 next week or something along those lines. These are the people who are rationally looking at some technical indicator and reading it back for the whole world to see.

I'm no technical analyst myself, but when traders outside of the Hive ecosystem start saying that HIVE is gonna pump, I usually keep a closer eye on the charts for a few days. I don't really change anything I do - mostly because I don't believe the vast majority of price predictions - but I do keep some buys and sells rotating in the HIVE orderbooks.

As you can see in the chart above, I usually accumulate HIVE right around that 2100-2200 SATs level. Even back on STEEM, this level acted as a decent range to buy and wait for a random pump like the one we saw yesterday. It could be a psychological level or it could just be a coincidence in the markets.

Either way -- accumulating at that level hasn't failed me for now.

As a user of Hive, I have an advantage over people who simply trade HIVE in and out for profits: I understand this blockchain ecosystem.

If you're reading this post, you're probably in the same boat. You know that liquid HIVE doesn't give you much power over the blockchain. You can't do much with liquid HIVE outside of transferring/trading it (like every other coin). The power comes into play when you stake that liquid HIVE and start using it for curation, delegation, projects, etc.

When you turn your HIVE into HIVE POWER, you get exactly what the name suggests.

The edge that I believe you and I get for this knowledge is in the event of HIVE crashing through your accumulation zone. If you pick a zone on the charts where you accumulate HIVE and the price breaks through it to the downside, you can hedge your risk by taking that liquid HIVE, staking it on-chain and earning an APY.

If you find the right project to delegate to, the right content to curate or even your own project to BUIDL, then you can utilize your HIVE POWER to generate anywhere from 10-30% APY. This reduces your cost basis overtime and you can slowly power down that HIVE back into its liquid form as you wait for HIVE to recover back to your accumulation zone and eventually break above that zone.

This is not financial advice. This is just a story about what I've been doing with HIVE on the exchanges over the past several months. I didn't trade STEEM all that actively back in the day. The more I trade HIVE, the more I regret not doing this in the past. To me, it seems like the edge is a bigger deal than I can even put into words.

Don't just listen to what I say, watch what I do. HIVE is quickly approaching my accumulation levels once again. We may sit back down here for a while or we may see it break out again to the up or downside. Either way, the strategy seems pretty clear to me. If we go down way below these levels, I'll keep averaging in and power up to earn an APY and reduce cost basis. If we go up, then I'll take profits on the way up just like I did yesterday.

Someone on Twitter mentioned that it could be too time consuming to look at these charts. I check-in on this maybe 2-3 times a week. I'm very inactive in that sense and I'd rather focus on Buidling Hive/LeoFinance than on trading all day long. This kind of accumulation/take-profits strategy is not very time-consuming at all.

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I tend to hoard my $Hive on chain like Smaug as I am loathe to cash out years of work for a few bits of fiat I would piss away. What I DO enjoy is swapping $Hive for $HBD because it stays on chain, in my wallet and there is some nice volatility/stability contrast with the coins.

The end goal is really to stack as much Hive as possible and having some say in buying low and selling high while staying on chain is probably not much, but fun.

What I AM going to do is buy BTC in little bits here and there through the automated teller machines I see to keep it cash based and not have a big flag on my bank account. With that, I would like to do some swapping against BTC because they seem to have lives of their own lately. It would be great to cash in on some of the Bitcoin FOMO and convert it to Hive which actually is a currency (community, fast, cheap)

I totally agree with you again my man. Happy for your continued success here that you actively make for yourself.

I like that approach a lot. I've heard from a few different Hive veterans that trading on the internal market has been a great way to pick up on some wild swings and low liquidity. I may have to try trading it a bit more actively since I'm on here anyways.

To me, trading is less about making money (although that is an obvious end goal of it) and more about staying engaged with the asset and industry. I do the same thing on the stock market to stay engaged.

That BTC strategy sounds interesting as well. Keep it small and keep it "off the radar". I like it

Keep it up 💪🏽

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That's the best strategy imo. The ladder....

The thing is that you never know when a bull run might begin, and when it does prices won't look back...so make sure that these orders aren't your entire stash and you have some more liquidity just in case...

Always have more liquidity just in case. I think that's the #1 rule to laddering in and out of positions like this.

If you're doing it with a small enough amount, you can always average in or out of something if it moves against your original bids/asks.

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I was talking to some peeps and I was thinking if we could get a wrapped USDC into HIVE-Engine that can help offset HBD it would make an amazing trading pair for the entire ecosystem and you could arbitrage between HIVE and tokens, bring more stability and even more liquidity to HIVE and you could trade markets more effectively

That would be a great idea. I think a lot of similar functionalities could come out of wHIVE.. but an engine implementation like that would be great - You should talk to Agg about that

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As a user of Hive, I have an advantage over people who simply trade HIVE in and out for profits: I understand this blockchain ecosystem.

When we change user to Owner. We behave and act differently

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User to Owner - that's the perfect way to think about it. It changes the entire game

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You would do better trading that Tesla thing, at least before it goes bankrupt. 😂

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I agree with you mate. Two things, I don't usually depend on what seasoned traders predict to happen primarily because I believe most of the steep price changes are caused by collective action brought by those predictions. For instance, if the price of an asset is predicted to MOON, people will start buying the asset, which will surely make the price increase.

Another thing, I agree that Hive Power is where the goldmine is. As you as you get the right formula for you (curation, delegation, etc) based on your targets and preferences, this is the best use for your Hive holdings.

Interesting, we are doing the exact same thing in terms of accumulating Hive. I have been watching and trading this sporadic pump pattern but missed it yesterday as I had set a sell order at 3000 and left it. Though I knew the resistance would be kicking in at the 2800 level as I watched it, I just let it ride. Because holding hive has that advantage as you said. If I missed the mark with other coins, I would be stuck with something I can't use much. I am basically learning how to trade through the unfair trading advantage of HIVE.

I understand your point and think that you are right. I'll keep reading you! Good post!!!!!

I wholeheartedly agree with your thesis and arguments @khaleelkazi! Being part of the Hive ecosystem does give you a different point of view on investing and staking crypto. I started to look at everything in terms of APY (APR) and dividends. Not only that, by being part of Hive, you get to learn about other interesting opportunities.

I recently found out about the Hive based game dcity.io. At first I thought it was another token/time sink on Hive, but then did some more research and realized that there is enough liquidity on hive-engine SIM tokens (native tokens of the dcity.io game) that one can actually make around 140% APY by playing the game! The dcity.io community is great and the developer team is very communicative on Discord and Hive, and the game systems give this project the potential to be a true winner in the crypto NFT blockchain-based game sector.

I recommend all Hive users to check out dcity.io, even if you do not like sim city kind of games because this game actually generates a significant daily passive income in Hive as well as in SIM, which you can then trade on the hive-engine market for Hive.

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With my gold holdings being much much larger than my hive holdings (12 K HP + 5K HP) you can imagine how I smiled when gold doubled.

Awesome post! I'm going to keep what @mindtrap mentioned in mind as well. :) Thanks.

Both pumps we had were 1 month apart so we might be expecting any in about the same time, that is a good to know thing when we come to be knowing Hive''s behavior in the charts.

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It's kind of a dimlemma: I get sad when the price moons because I wanted to buy more and if it slumps I worry that it will get worthless 😅 So I can't ever be happy about the price movement ;)

Next time I buy a couple hundred Hive I might just do this! Start a little bit of trading with it, rather than just power it up,

Not a lot to lose as I see it.

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