Bitcoin keeps falling as Nasdaq goes up intraday | Hacker News Reader

Bitcoin keeps falling as Nasdaq goes up intraday

9 pointspaulpauper11 comments

In 15 plus years of trading I have never seen anything so consistent. And it has gotten no media coverage. How can can something so profitable so long stay so covert? Basically , you short Bitcoin when the stock market opens and go long QQQ. And then close both legs at the market close.

This has netted something like 60 percent returns over past few months, I am running it now (and so are a few people I know) but it's crazy how well it worked. I wonder if this has to do with Silk Road coins being sold intraday by the fed. government on Coinbase. Who knows.

It makes Renaissance Technologies' 30 percent ( net) returns more believable, the fact such a simple trade can work so well for so long. Imagine scaling this up with more assets, more computing power to find more patterns .

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I remember your last post [0] on this. :)

I hope you get more replies this time. It's quite an interesting phenomenon. Personally, as a non-expert, I'm skeptical that such an obvious arbitrage opportunity would be unexploited, so I think there must be some mechanistic explanation for the divergence. My hypothesis is that it somehow reflects the delay in converting crypto bucks to fiat currency.

[0] https://news.ycombinator.com/item?id=35991593

another great day with method. . yeah i'm really good at pattern recognition and such.

Sounds interesting. Do you know of a good non Reddit place to learn more about this? Googling, I only found light articles sparingly, but idk where to look for communities of people talking about it. I’m curious what tools you (or y’all) use to trade with this strategy.

I can write for you a python script that does that.

You will have to oay me something little though.

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no one is talking about it because hardly anyone knows about it

I know next to nothing about options and so I have a question. QQQ appears to an ETF with 'usual suspect' holdings[1] so what is it about QQQ that make it useful for your purposes ?

From my limited understanding of options going long on QQQ would make sense if it tended to move in the reverse direction to BTC, and I assume that's what it does because otherwise you wouldn't be doing it, but can you explain why it does that ?

[1] https://finance.yahoo.com/quote/%5EQQQ/

i don't know why the method works so well. maybe something to do with Coinbase sales from Slk Road asset forfeiture https://www.fxstreet.com/amp/cryptocurrencies/news/silk-road...

it makes logical sense for the govt. to liquidate during market hours

Sorry I didn't make myself clear. I understand that if there's a steady decline in BTC (perhaps due to Silk Road disposals) then going short on BTC would be beneficial but how does the other leg, going long on QQQ, protect you from the expected decline in BTC not happening during the course of the day ?

Sorry if I've totally misunderstood what's going on ;-)

>It makes Renaissance Technologies' 30 percent ( net) returns more believable, the fact such a simple trade can work so well for so long. Imagine scaling this up with more assets, more computing power to find more patterns .

I agree, and this is always my argument to people who say stuff like "TA doesn't work".

Yet at the same time many hedge(note not HFT) funds funds are using data and charts to find exactly those relations and trade them and model them. Regardless of the value or PE or whatever of the underlying

> TA doesn't work

What is TA?

Technical analysis

https://en.m.wikipedia.org/wiki/Technical_analysis

Amongst many "efficient market" proponents, technical analysis has a reputation of being mostly equivalent to a crystal ball.

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