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That Crypto Trader You’re Paying for Advice Isn’t as Smart as You Think

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    That Crypto Trader You’re Paying for Advice Isn’t as Smart as You Think

    Professional cryptocurrency traders are a clever bunch. They must be, with all their talk of MAs, fibs, and ichis. Mere mortals could never hope to acquire their expert charting knowledge or ability to glean breakouts from glancing at a graph. Thankfully, there’s a way for beginners to trade like a pro without needing to spend five years at forex school: by paying for it. Joining a paid trading group seems like an easy way to fast track your gains, but be careful – those paid signals could be costing you more than you think.

    **Also read: **Venezuelans Turn to Bitcoin as Government Crackdown on Mining Intensifies

    Fib Level: Off The Charts

    Traders, like gamblers, have a tendency to overplay their wins and hide their loses. If you’re a Twitter trader with an army of thousands hanging on your every call, admitting to being wrong isn’t good for business. When “pro” traders get it right, they have no qualms about reweeting their correct call. Get it wrong and those tweets are deleted faster than you can say flash crash.

    That Crypto Trader You’re Paying for Advice Isn’t as Smart as You ThinkThe risks of blindly trusting traders was illustrated this week after someone published The Wolf of Poloniex’s Bitmex trading history. The Wolf, who styles himself on Leonardo DiCaprio’s Jordan Belfort, boasts a Twitter following of over 75,000 and is famed for his cries of EXIT ALL CRYPTO MARKETS anytime bitcoin looks bearish. He also operates a private trading group, The Wolfpack, which costs 0.1 BTC to enter. Within this inner circle, The Wolf dispenses the sort of priceless insights that aren’t available to the proletariat.

    It all sounds very lucrative, not least to The Wolf of Poloniex, but what about to those who’ve shelled out $1,000 or more for his wisdom? Well, according to one accuser, the pseudonymous trader could be a sheep in wolf’s clothing.

    That Crypto Trader You’re Paying for Advice Isn’t as Smart as You Think

    The Trader Who Cried Wolf

    If the above screenshot is correct, The Wolf of Poloniex has lost around half a million dollars, largely from unsuccessfully trying to short bitcoin.

    That Crypto Trader You’re Paying for Advice Isn’t as Smart as You Think

    This revelation raises questions not only as to the value of The Wolf’s predictions, but to those of Twitter traders in general. Critics swiftly poured into the thread to dissect The Wolf’s abilities, with one jibing: “His source of income is obviously not trading. It’s his wolfpack 0.1 BTC subscriptions (which he also blew by buying altcoin tops).” Others responded:

    That Crypto Trader You’re Paying for Advice Isn’t as Smart as You Think

    It’s easy to lay into traders for getting things wrong, but in their defense, charting is not an exact science. Even when it’s done well, it arguably bestows only the slenderest of advantages. Sniping at Twitter traders because you lost money is like blaming Ferrari because you crashed your high performance sportscar. The Wolf predictably came out swinging, retorting:

    That Crypto Trader You’re Paying for Advice Isn’t as Smart as You Think

    Riding to his defense, another user responded: “All jokes aside, people just love to hate. I support the wolf. This man makes educated calls based on experience. Follow him or not you make your own calls, do your own research.”

    This sentiment was echoed in a recent Medium post which urged:

    Invest in projects you believe are going to impact billions of people within the next 10 years. Do your due diligence. Invest in open teams that are accessible. speak to all the people building the technology, get to know them personally.

    Exit All Trader Groups

    The real Wolf of Wall Street, Jordan Belfort, came out swinging this week, denouncing bitcoin as a “huge danger” that’s “guaranteed” to fail. His Twitter namesake, at least, has nothing but love for the digital currency. Regardless of where The Wolf of Poloniex’s wins and losses stand, there’s a case for questioning the wisdom of paying to enter private groups for trading advice that can be found elsewhere for substantially cheaper. Veteran bitcoiner Charlie Shrem put it best when he wrote:

    It’s easy to be a “crypto expert” with “private trading groups” when everything is rising….Most of these “experts” showed up less than a year ago.

    For cryptocurrency investors seeking a less expensive alternative to paid trading groups, there are a few options. A number of crypto asset funds such as Safinus have sprung up which allow investors to defer to the wisdom of experts and earn a passive return that way. It’s too early to assess the efficacy of these models however, which are still relatively new.

    Alternatively, do what the best crypto traders do: set aside one evening a month to perform fundamental analysis on the most enterprising projects currently in the works. Do your own research and that way the only person you’re answerable to is yourself. Finally, if you don’t have the time or focus for that, buy into some of the top market cap cryptocurrencies, forget about them and come back in a year.

    <figure id="attachment_92847" style="width: 628px" class="wp-caption aligncenter">That Crypto Trader You’re Paying for Advice Isn’t as Smart as You Think

    <figcaption class="wp-caption-text">Anything can be charted if you put your mind to it.</figcaption>


    To date, that’s proven a far more lucrative strategy than agonizing over fib retracements, ichis, and moving averages. That’s not to say you should disregard cryptocurrency traders altogether. They often get things wrong, but their memes are still dank and their charting knowledge is enviable. Follow them on Twitter by all means. Just don’t follow them blindly.

    Have you found private trading groups to be profitable? Let us know in the comments section below.

    Images courtesy of Shutterstock.

    Disclaimer:_ This article is intended for informational purposes only and should not to be considered as trading advice. Neither Bitcoin.com nor the author is responsible for any losses or gains, as the ultimate decision to conduct a trade is made by the reader. Always remember that only those in possession of the private keys are in control of the “money.”_

    The post That Crypto Trader You’re Paying for Advice Isn’t as Smart as You Think appeared first on Bitcoin News.


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