Copy Trading Master’s Winning Strategies Review — Episode 67
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/LBA3D77565
Trading Style: Swing Trading
2. Trade Operation Recap
Utilizing a 5x leverage with full margin, a short position was opened on GRASS. The entry price was 3.3028 USDT, and the closing price was 2.4515 USDT, achieving a remarkable single trade return of +128.89%. See the image below for details:
3. Trade Review
3.1 Market Background
On November 6, multiple U.S. media outlets, including Fox News, projected that Republican presidential candidate Donald Trump had secured at least 270 electoral votes, effectively clinching victory in the U.S. presidential election. Additionally, the latest data from the Associated Press indicated that Trump was highly likely to win the seven key swing states — collectively accounting for 93 electoral votes — which are pivotal battlegrounds for both parties.
On November 7, following its Federal Open Market Committee (FOMC) meeting, the Federal Reserve announced a reduction in the target range for the federal funds rate from 4.75%–5.0% to 4.5%–4.75%, representing a 25-basis-point cut. This reduction was half the size of the cut made in September, which had marked the start of the first easing cycle in four years. The decision also marked the second consecutive meeting where the Fed opted to lower rates.
On November 13, the U.S. Bureau of Labor Statistics released data showing that October’s nominal and core Consumer Price Index (CPI) figures matched market expectations. Nominal CPI increased by 0.2% month-over-month, while core CPI rose by 0.3% month-over-month and 3.3% year-over-year, all consistent with the previous readings.
On the same day, media reports suggested that President-elect Donald Trump hinted at plans to bypass the Senate’s confirmation process to directly appoint members of his administration. These plans appeared to include replacing Gary Gensler, the current Chairman of the Securities and Exchange Commission (SEC).
3.2 Trade Analysis
From October 30 to November 20, on the 4-hour Bitcoin chart, the price showed a continuous upward surge, breaking previous highs and entering a consolidation phase at elevated levels. The trading range remained between $85,000 and $94,000. See the image below for context:
On November 5, as U.S. voters officially began casting their ballots, the probability of Donald Trump winning the presidential election, as tracked on Polymarket, surged from 62% to around 80% within a short timeframe. The market reacted strongly, placing heavy bets on Trump’s imminent victory.
By the early hours of November 6, with most states completing over 90% of their vote counts, Donald Trump was declared the winner, reclaiming the presidency. This outcome triggered a significant rally in the cryptocurrency market. Bitcoin broke through its previous high of $74,000, and the broader market followed suit with continued gains.
On November 11, Binance announced the listing of ACT, a memecoin with an AI theme, and labeled it with the “seed project” tag. This news ignited market enthusiasm, causing ACT to spike more than tenfold in a short period.
On November 12, the price of GRASS, another AI-themed asset, climbed to around $3.6 before experiencing a pullback. Recognizing that GRASS had already seen substantial gains and Bitcoin had risen to relatively high levels, I decided to attempt a short position on GRASS with low leverage.
Following this, GRASS underwent a period of price fluctuations, ultimately dropping to a low of approximately $2.33.
On November 20, Bitcoin experienced a sharp rally, approaching the $94,000 level, while some altcoins also saw rebounds. At this point, I began to gradually close my short positions on GRASS in batches, capitalizing on the price movements. See the chart image for details:
3.3 Winning Strategies Summary
How to Manage Drawdowns in Trading?
In trading, every market fluctuation presents opportunities for profit but also carries the risk of drawdowns. No strategy can guarantee constant profits without occasional losses. As such, drawdowns should not be viewed as a sign of failure but rather as a natural part of the account growth process.
Healthy Drawdowns refer to temporary decreases in account balance within an acceptable range, typically caused by market volatility. These drawdowns are manageable and can be controlled through sound trading strategies and robust risk management. Harmful Drawdowns, on the other hand, are marked by significant declines in account balance, often resulting from over-leveraged trades, overconfidence, or inadequate risk management. Such drawdowns can jeopardize the long-term health of a trading account and are far more challenging to recover from.
Strategies to Control Healthy Drawdowns:
- Reasonable Position Sizing Avoiding over-leveraged and frequent trading is critical to controlling drawdowns. By limiting the risk of each trade to a small portion of the account’s total capital, traders can ensure that a single loss will not cause significant damage to their portfolio.
- Strict Stop-Loss Settings Define clear stop-loss levels before entering any trade. If the market moves against your expectations, executing the stop-loss promptly prevents losses from escalating.
- Maximum Drawdown Limits Establish a maximum allowable drawdown for your account. If this threshold is reached, cease trading temporarily to reflect and reassess your strategy.
- Avoid Over-Leveraged Trades While high-leverage trades can yield substantial profits, they come with significant risk. A single unfavorable trade could lead to considerable losses. It’s crucial to maintain disciplined position sizing to avoid catastrophic outcomes.
Drawdowns are an inevitable aspect of trading. However, with prudent risk management and position control, they can be confined to a healthy range. Traders should view drawdowns as opportunities for growth, using them as a chance to learn and refine their strategies. By continuously adjusting and improving their approach, traders can develop more mature strategies and navigate the financial markets with confidence and stability.
Note: Personal opinion, for reference only. Opportunities and risks abound, always do your research before investing.
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