Is HIVE a Good Cryptocurrency to Trade?
Back when we were on Steem, I didn't trade much in and out. I focused more on accumulation through blogging, curating and other use cases of the blockchain ecosystem.
Now that we're on Hive, I see a growing reason to stay active in the market and make regular trades. If for no other reason than to stay engaged in HIVE's price action, I think it is a valuable practice.
I am obviously no technical analyst, so take everything I say related to trading with a grain of salt. I don't even consider myself a trader. I would categorize my style of investing as 2 parts accumulator, 1 part trader and 3 parts HODLer. Trading is just something I enjoy doing as an engagement tactic.
I've been trading HIVE actively over the past 2 months and there are definitely some patterns that you can take advantage of. One of the main ways that I've been trading HIVE is by accumulating when price reaches a particular target and then immediately setting ladder sells going up to a much higher price (all in terms of SATs - HIVE/BTC pair trading).
These wicks that I've highlighted with circles are the reason why ladder sells are so important. HIVE has a very tight supply and if you've traded HIVE on an exchange at all, then you'll see the loose orderbooks. The price swings heavily when a large buyer/seller comes into the mix and this can open up a lot of opportunities as a trader who's using ladder limit orders to pick up on these wild wicks up and down.
HIVE is a Low-Risk Trade
Crypto trading is risky business. These assets regularly make a 5% move look like child's play. For my style of investing, I don't want to be caught trading worthless shitcoins - even if there's a potential to make 300% on a pump and dump.
In my opinion, there's plenty of trading potential in coins like HIVE, BTC, ETH and BAT. These are 4 cryptocurrencies that I believe in on a fundamental level. I know that if I buy-in to any of these 4 currencies and get a "bad" price (relative to the price action that follows), I can simply HODL the coin and wait for the fundamentals to play out.
When it comes to these 4 cryptos, there's another feature that makes HIVE even more worthwhile on a fundamental level - staking.
I've made plenty of bad trade entries as HIVE fell from it's all time highs. Most of them haven't been too bad relative to the fall in price (especially when you look in USD terms), but some of them have been double digit % "losses".
Instead of doing what many other traders would likely do - sell the HIVE, close the trade for a loss and move on - I have chosen to trade an asset that I already believe in. So instead, I take the HIVE from those trades that have gone uniquely against me and utilize it to make more HIVE. I stake it on-chain and earn anywhere from 10-20% APY.
Eventually, HIVE will rise in price (my opinion) and in the meantime, I will effectively be reducing my cost basis by earning more HIVE. To me, this makes HIVE one of the most unique assets that you could trade. Versatility gives traders a lot of options and if you look for untraditional ways to leverage the features of an ecosystem like HIVE, you can turn losers into winners.
This post has been quite different than my usual content, but I think I got my main points across:
- HIVE is approaching one of my accumulation zones (~2000-2200 SATS)
- Trading can be used as a tool for engagement rather than pure speculation
- Trading in assets that you fundamentally believe in can be more "safe" than trading the most speculative, shiny object
- Trading in HIVE is particularly unique thanks to staking
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I've always had some trouble predicting these peaks and everytime I try to set a ladder pattern sell order, the price action seems to do way more that what I expected lol! So I just have my buy orders placed and HODL!
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You're obviously right, versatility makes hive a total gem and a unique coin too and with the right trade scope put in place you get more with slim chances of making loses
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Hive is a means of helping people throughout the global community which makes it even more appealing. As you point out, there may be 300 other coins but what makes hive better is that we are all connected to each other through the community.
I’ve been doing this exact thing on ionomy. The volume there is even lower than other indexes I think.
I made several 15% profit trades between bitcoin and hive. Since I like both of these, I cannot loose.
It’s a slow process, since it can take a few weeks before something happens. But I have had days where both my sell orders and buy orders were filled within an hour giving me a 25% profit.
Simply because a big seller and buyer came along.
Thin orderbooks and low-moderate volume work wonders when it comes to laddering in your buys and sells across a small-medium spread :)
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I think HIVE would be hard to trade. Since it went online, after the dump, we have traded in a range. There is also the question of liquidity.
But I agree, there is the long term outlook that helps in a situation like this. Plus, as you mentioned, the fact that one's cost basis could be improved by using the HIVE to generate returns in other ways.
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Well, I guess you are right about this.
What? this makes no sense.
Long-term, the natural trend of HIVE (and STEEM for that matter) is downward, simply because of inflation.
Everyday, every new HIVE issued on the chain end up reducing the value of each individual token:
If today people bought HIVE for 1 USD and there were only 100 HIVE in circulation, each hive is valued at 1 USD.
Tomorrow, there will be 110 HIVE, with no new money entering the system, so now, each token is valued at 0,9 USD.
This is the natural progression the the Token Value, since there is no limit to how many tokens will be issued.
The only way to "fight back" the devaluation is making the token attractive, so more people want to buy the token to whatever reason they want to use it for.
This means create uses for the token.
While there is a lot of projects that are working and meeting some success (Like splinterlands), there is no guarantee that these projects will have lifetime or critical mass big enough to attract millions of people.
So, yeah, there is risk, and not a small one.
Sure, staking reduces this a bit, but is only a small portion of the inflation rate, like, if the inflation is 10%, the staking pay back 2-3%. Therefore, the long-term devaluation is still there.
Actually there are only 144 million liquid hive, there are 228 million that are not staked but about 83 of those are locked up in the DAO so they are not available for trading.
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I am still new to the game so I am in total accumulation mode, but I do see the potential of what Hive can be. And I think the more it is traded the higher the price potential. Hive is still a very now currency and I think it is only going to get better with time.
Patience is what one's need
to trade crypto. Still in the learning
phase. So many exchanges to play with #hive.
So far Binance could be the place to see quick change of hands.
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HIVE gives a trader more options to gain from it. If HIVE price falls, staking and earning more HIVE is a good option. Eventually, the price will rise, then you will have more HIVE.
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While I personally don't know much about crypto trading, I do know of some people that are into trading Hive itself and yeah it's pretty low-risk compared to some other cryptos. No matter what, it's always important to remember all of the principles of trading and never act based on emotion.