Spike strategy

Investor guide

You can invest in Spike strategy on Moonbase. It works by placing buy orders at very low prices. This way, it catches “capitulation spikes” — irrational sell-offs from inexperienced traders.

Essentially, Spike strategy picks the low-hanging fruit and re-sells it in small portions at normal market price.

Overview

Potential: 3x-12x allocated capital per spike (depending on spike depth; see examples).

Min deposit: 0.1 BTC.

Max deposit: 100 BTC.

Duration: can withdraw anytime.

Profit distribution: 50/50 between us & investors.

Examples

Others:

12x spike at BINANCE:YOYOWBTC on 14 Mar 2019 from 0.00000481 to 0.00000040.

at BINANCE:YOYOWBTC on 14 Mar 2019 from 0.00000481 to 0.00000040. 8.2x spike at BINANCE:CMTBTC on 30 Nov 2018 from 0.00001077 to 0.00000130.

at BINANCE:CMTBTC on 30 Nov 2018 from 0.00001077 to 0.00000130. 6.9x spike at BINANCE:CNDBTC on 12 Jun 2018 from 0.00000693 to 0.00000100.

On average, there are about 1–2 spikes per month.

Description

Strategy detects that CND is traded at 0.00000600–0.00000615 BTC. Strategy places an order to buy 3000000 CND at 0.00000200 BTC (3x lower from current bid price). An irrational trader sells 9500000 CND at once, creating a spike & driving the price much lower. Strategy buy order for 3000000 CND is filled at 0.00000200 BTC. Rational traders close the gap by placing buy orders in the interval between 0.00000200–0.00000600. Strategy starts selling with small orders (average sell price = 0.00000605). Strategy receives a revenue of 18.15 BTC = 3000000 CND * 0.00000605 BTC.

Results:

Input: 6 BTC.

Output: 18.15 BTC (~3x initial capital).

Spike strategy allows to 3x initial capital with low risk, but works only when there’s an irrational trader who wants to sell a large amount of tokens.

Risks

Delisting: sometimes, a sell-off happens because the token has been delisted. However, it doesn’t happen instantly — instead of one big sell-off, there are multiple small sell-offs (cascade). The strategy detects that and cancels the orders.

Fundamentals: sometimes, a sell-off happens due to fundamental factors (developer leaving the project, vulnerability being discovered, etc). This case is similar to delist: it doesn’t happen instantly, because the information spreads in waves — there are small delays between sell-offs. The strategy detects that price is going down too fast & cancels the orders before they are filled (it has enough time, since closest orders are sitting at -50% from pre-sell-off price).

Exchange: it is somewhat risky to keep your money on the exchange, but most trading strategies require that anyway. In addition, we only use reputable exchanges: Binance, Bittrex, OKEx, Huobi.

It’s time-consuming to execute this strategy manually. Most people don’t have the time to constantly move the orders to maintain the distance from bid price. Our strategy is fully automated: it monitors the market 24/7, moves the orders accordingly and re-sells the tokens it bought without human intervention.