Copy Trading Master’s Winning Strategies Review — Episode 60
Easy Copy, Smart Trade! Discover the winning strategies of our popular traders.
- Copy Trading Master’s Introduction
User Nickname: BlingBling~
Trader’s Profile: https://www.lbank.com/copy-trading/lead-trader?id=LBA3D77565
Trading Style: Swing Trading
2. Trade Operation Recap
We used 50x leverage for a full-position short on BTC. The entry price was 66,351 USDT, and we closed the position at 64,412 USDT, resulting in a single trade profit of +146.1%. Please refer to the picture below:
3. Trade Review
3.1 Market Background
On September 11, the U.S. Bureau of Labor Statistics reported that the Consumer Price Index (CPI) for August rose by 2.5% year-over-year, aligning with expectations and showing a notable decrease from the previous month’s 2.9%. This marks the fifth consecutive month of declining inflation, reaching the lowest level since February 2021. On a month-over-month basis, the CPI increased by 0.2%, matching both forecasts and the prior month’s data.
At 2:00 p.m. ET on September 18, the Federal Reserve announced its September rate decision, cutting interest rates by 50 basis points. The dot plot indicated that the Fed expects to cut rates by another 50 basis points before year-end. However, opinions within the Fed were divided: 10 officials forecast at least 100 basis points of cuts in 2024, while 9 predicted cuts of 75 basis points or less. Notably, for the first time since 2005, a Fed Governor dissented on the rate decision, with Governor Bowman favoring a smaller 25 basis point cut.
On September 19, Republican presidential candidate Donald Trump was spotted at a New York restaurant known for accepting Bitcoin, making him the first former U.S. president to use cryptocurrency for a transaction.
On September 23, data from S&P Global showed that U.S. manufacturing activity contracted for the third consecutive month, reaching a 15-month low, while the expansion of the services sector slowed slightly. The composite Purchasing Managers’ Index (PMI) also indicated slower growth. Most notably, the price index saw a sharp rise, signaling potential inflationary pressures.
On September 26, the U.S. Bureau of Economic Analysis reported that the final estimate for Q2 GDP growth came in at 3% annualized quarter-over-quarter, slightly higher than the expected 2.9%. The previous revised figure was also 3%, while the initial estimate was 2.8%. In comparison, Q1 GDP grew by 1.6%. On the same day, the Q2 Personal Consumption Expenditures (PCE) price index showed a 2.5% annualized quarterly increase, in line with earlier estimates. The core PCE price index, a key inflation gauge, also increased by 2.8%, meeting both expectations and the prior revised figure, which was down slightly from the initial estimate of 2.9%.
On September 27, in Japan’s Liberal Democratic Party (LDP) leadership election, 67-year-old former Defense Minister Shigeru Ishiba won in the second round of voting, securing his position as the LDP leader. He is set to succeed Fumio Kishida as Japan’s 102nd Prime Minister on October 1. Analysts suggest that Ishiba is likely to continue most of Kishida’s domestic policies, supporting Japan’s reflationary environment. In terms of foreign and defense policy, Ishiba is considered a conservative hawk. His economic stance may indicate potential upward pressure on the yen and Japanese bond yields.
3.2 Trade Analysis
From August 16 to September 30, Bitcoin’s daily chart showed repeated fluctuations within the $52,500 to $70,000 range, as shown in the picture below.
On September 18, the Federal Reserve announced its September rate decision, cutting interest rates by 50 basis points, slightly exceeding market expectations. Shortly after, the Swiss National Bank and the People’s Bank of China both introduced interest rate and fiscal policies that signaled varying degrees of easing expectations.
On September 26, the U.S. finalized its Q2 GDP growth at 3% annualized, slightly above the forecast of 2.9%. For comparison, Q1 GDP grew by 1.6%. On the same day, the U.S. Q2 Personal Consumption Expenditures (PCE) price index also matched expectations at 2.5%.
On September 27, Japan held the Liberal Democratic Party leadership election, where 67-year-old former Defense Minister Shigeru Ishiba won in the second round, successfully becoming the new LDP leader.
Given the sustained rise in the cryptocurrency market since early September and the realization of the Fed’s first rate cut, we saw a short-term opportunity to short the market.
On September 27, Bitcoin’s hourly chart (shown below) saw a sharp surge. After several days of consolidation between $63,000 and $64,500, Bitcoin quickly rose above $66,000. The price attempted to break $66,500 but failed, leading to a pullback, presenting an opportunity to short the market.
On September 28 and 29, Bitcoin oscillated narrowly between $66,000 and $65,500.
On September 30, Bitcoin broke below the $65,000 support level, continuing to dip further. During the same day’s Asian trading session, most Asia-Pacific stock markets saw declines, with Japan’s Nikkei falling nearly 5%, while the FTSE China A50 index rose more than 5%. The market was also influenced by the upcoming inauguration of Japan’s new Prime Minister Shigeru Ishiba, whose policies added significant uncertainty to the already loose yen liquidity environment.
At this point, we anticipated a high-level pullback for Bitcoin within its range, closing part of our short positions around $64,400, while holding onto the remaining short positions for further downside potential.
3.3 Winning Strategies Summary
On September 18, the first anticipated rate cut of 2024 in the U.S. was realized with a 50 basis point reduction. Although the cut was slightly more aggressive than expected, the cryptocurrency market had already priced in the move ahead of time. Following this, we encountered several instances of shorting and hitting stop-losses. However, when the price broke above $66,000 and then pulled back, we held onto the short positions and maintained them throughout.
Why Short the Market? Since early September, the cryptocurrency market had experienced a continuous rally. Bitcoin and Ethereum ecosystem tokens surged, followed by rotations into AI, public chains, and meme tokens. This sequence of upward movements had exhausted much of the market’s bullish momentum. Based on the latest U.S. economic data, the economy still appeared strong, with inflation (as reflected by the CPI and PCE indices) continuing to decline, though employment numbers showed a dip. Additionally, Japan, a major liquidity source for U.S. equities, had just elected a new prime minister on September 27, increasing the likelihood of a stronger yen. This, in turn, could further weaken the U.S. dollar and U.S. equities.
Note: Personal opinion, for reference only. Opportunities and risks abound, always do your research before investing.
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