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“A trader must be disciplined and have preparation,” says Iván Paz Chain.
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The specialist projects what price Bitcoin could reach in this cycle.
In Buenos Aires, capital of Argentina, a new edition of LABITCONF was held this November 1 and 2.
CriptoNoticias took advantage of the occasion to talk with representatives of the bitcoin (BTC) ecosystem, the cryptocurrenciesfinances, investments and trading.
One of the people we had the pleasure of speaking with was Iván Paz Chain, CEO and founder of Trading Different. This is a company that develops tools for investors and traders with the aim of optimizing its operations.
During the interview, Iván gave us some of his opinions on trading, on the markets and also anticipated what his personal projection for the price of bitcoin in this bullish cycle.
You talk about investors and traders. What is the difference?
Well, mainly, not everyone is a trader. In fact, what is always recommended is to study bitcoin first and then invest in bitcoin, as the famous holders do, who invest with a long-term perspective. There are holders who never sell; that’s a bit of the bitcoiner feeling.
And then there are people who are professionally dedicated to trading, that is, operations practically every day or several times a month to take advantage of market volatility.
It is often said that 90% of traders lose money. Is this true?
It’s statistical, yes. Due to a lack of liquidity in the bitcoin market and in the rest of the altcoins, there is an opportunity to take advantage of how they manipulate the price to absorb liquidity.
Part of that liquidity is traders’ stop losses and liquidation points. Our algorithm detects those areas where people are going to lose, and we develop strategies to take advantage of them.
What does this mean? We do not simply enter the market in a long or short position; We wait for positions to be liquidated. That is, we enter after others have lost and been liquidated. That is a good confirmation point to enter the market because we rule out possible organic price volatility that could take us out of the position with a loss.
You just mentioned market manipulation. Who manipulates the market and why?
Well, that’s a complex question. There is no person identified as such. We know that they are whales, large operators that handle a lot of volume.
It is not that they necessarily manipulate the market for malicious reasons, but rather out of a need for liquidity. They trade large volumes and to open a significant position, they need a counterparty to close it at a profit. That counterpart is liquidity.
There is talk that they could be the same market makers or the exchanges, but the reality is that they are operators with a lot of experience in the market, who develop their own high-frequency bots and advanced algorithms to detect market liquidity.
What advice do you give to a person who wants to get serious about trading?
Simply recommend that trading is not for everyone. Don’t trade if you are not prepared. Trading is a profession that requires preparation before starting. Although we offer trading tools, the most advisable thing, if you are not going to dedicate the time of study and experience in front of the graphs, is to buy and hold.
And who is trading for? What characteristics should a good trader have?
Anyone with a gambling profile should stay away from trading because they will fall into the easy bet. Professional trading is very far from gambling addiction.
A deep, quantitative, statistical analysis and specific premises are needed to enter and exit the market. A trader must be disciplined and have the time and energy to prepare.
This week there are elections in the United States. Are there any on-chain metrics that are anticipating something?
The price has been getting ahead of sentiment regarding the US presidential election. There are good expectations that Trump, who is quite pro-bitcoin, will win.
This year Trump was at the conference in Nashville, and I had the opportunity to be there. I heard what his speech was and what his political proposals would be. That is generating a bit of FOMO, and the market wants to anticipate.
No doubt during the election there will be volatility in the market, whether up or down, to take out the over-leveraged. After that volatility, the price will take its natural and organic path, which will probably continue upwards.
Currently, one of the tools we have is the BTC Supplier Model, which tells us how much it costs to produce a bitcoin. Today, one bitcoin costs approximately $76,000 to produce, and the price is clearly below that.
Why does it influence the market and make it rise? It is a logical question of supply and demand. Miners, who are the main liquidity providers in the market, do not sell bitcoin below its production cost. They are hoarding and holding, which decreases the floating supply in the market.
Speaking of miners, does the Halving effect still make sense, considering that 98% of bitcoins are already issued?
Yes, totally. It still has a lot of effect. This particular Halving was important and significant because it reduced the issuance rate of bitcoin to 0.82% per year.
In economic terms, this makes bitcoin twice as strong or scarce as gold. This is an iconic event in the history of the world economy, and surely the economics books of the future will talk about it.
Finally, and clarifying of course that this is not financial advice or investment recommendation, do you have any projections about how far bitcoin could go in this bullish cycle?
It is not easy to predict the price of bitcoin. It all depends on liquidity and how far they let it go. If there is strong selling pressure near $100,000, it will be difficult for the price to break it.
It is necessary to be cautious and evaluate the buy and sell orders in the market. I project it above $140,000, but we will analyze all our indicators and graphs.
If the price, for example, reaches $90,000 and we see strong selling pressure from miners, ETFs that we also monitor, and other whales, then we will have to consider taking profits in the short term.
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