WONDER MONDAY CASE

It’s a well-known truth that the beginning of trading day, the end and an expiration date are not recommended for making trades. But what’s about the beginning of the week, for instance? For the majority of the people Monday is a sleepy and unproductive day, similarly many traders do consider the market ineffective on Mondays.

Larry Richard Williams, a famous American author, stock and commodity trader figured out an interesting feature of Mondays on market — ineffectiveness. We’ve picked up this fact and were curious enough to make our own test on crypto market. Here we go!

The aim was to distinguish the day during which BTC/USD price was following its global trend.

Might Mondays in crypto be more lucky? Won’t you agree — this knowledge may bring you some profit or even a lovely Lambo, will you? We think so too.

2017 Test

Thus, we started the analysis from 2017 — the period from 01/01/2017 to 12/31/2017.

[As you remember that happy times of the bull market, the global trend was upwards — enjoy the graph below]

BTC/USD price 2019. Source: https://coinmarketcap.com/currencies/bitcoin/

Simply, first of all, using the daily chart of the BTC / USD trading pair, we counted falling candles during each day — when the closing price of the candle was lower than the opening price.

And — look! — again Mondays stand out:

So, as you can see, on Monday the daily candle is least likely to close in minus. That brings us to conclusion:

On Monday the price movement most closely corresponded to the global growth trend in 2017.

2018 Test

We got everything with 2017. BUT! Mid-December brought us some changes: The global trend of the BTC / USD movement changed to a bearish one.

BTC/USD price 2018. Source: https://coinmarketcap.com/currencies/bitcoin/

Trading strategy

Then let’s make an assumption:

If on Monday the price movement is more likely to repeat the global trend, then every Monday we open a short position at the beginning of the day and close it at the end of the day. However, it is important to take into account that the falling market is more inertial than the bullish one. Therefore, the position will be closed at the end of Tuesday.

Note: After opening a position, we set a stop loss at 5% [ Hint: Always set stop losses! ]

We had tested the strategy several times for the period from 01/01/2018 to 12/31/2018 on 1 BTC (Trading volume of each trade).

Results obtained:

With an initial deposit equal to 18,000 USD, the increase was 30%.

Looks like the price followed its global trend in 2018 like in 2017, indeed.

This strategy is not a ready-made tool for trading and is only the result of an interesting study.

Note: The following results can be improved: UTC time was used for this strategy. However, it is possible to determine at what time within each day trading volumes are peaking. According to it, the timing of trading operations can be adjusted according to the results obtained.

And key conclusion! — Do not sleep on Mondays :)

Disclaimer: This is not an investment or financial advice. Do your own research.