Six Years as a Bitcoin Day Trader: An Interview with Rob

What’s it like to make a living day trading BTC and other cryptoassets? How has the crypto trading landscape evolved over the last six years? What does the future look like for crypto as an asset class?

We sat down with Rob, one of SFOX’s long-time day traders, to get his perspective on all this and more. A day trader of crypto since late 2013, Rob has seen many faces of the industry — from using BTC to empower his small business, to trading crypto full-time, to streaming his trading on the crypto-power DLive platform. We were honored to have this interview hosted live on Rob’s stream, where we discussed everything from his first involvement with Bitcoin, to his favorite (and least favorite!) trading strategies, to his experience in the growing industry of trade-streaming.

This is an abridged transcript of our conversation with Rob. If you’d prefer to watch the interview in its entirety, you can find the full recording on our YouTube channel.

The comments and answers to questions are Rob’s own, and do not necessarily reflect the views of SFOX or its staff.

SFOX: Welcome, everyone, to SFOX’s interview with Rob, one of our day traders. Rob, thank you for taking the time to be interviewed by us, and for having us on your stream.

Rob: Yeah, absolutely. I appreciate the opportunity.

SFOX: How did you hear about SFOX in the first place?

Rob: Good question. I actually was just digging around in Crypto Twitter in the early days — sometime in early 2014, I want to say. And SFOX just caught my attention. It was kind of just like a diamond in the rough, you could say: I could tell that they were a new startup; they weren’t really big yet, but they had this really huge vision that I thought would be amazing if it really worked out. So, I just remember taking a stack of funds and sending it over there, kind of taking a chance on them. And it was a great decision, actually.

SFOX: You’ve used basically every crypto trading platform and exchange out there. What led you, after first exploring SFOX, to continue using it to this day?

Rob: Well, first and foremost, I’ve always had a great relationship with the support team. I kind of felt like I was a part of the development process early on — kind of like a beta tester, if you will. And I just saw that there was a continued progression: it wasn’t just a static platform that that was just going to sit around and be what it was at that time forever. That just continued to capture my interest and provide more and more opportunities to make money. So, they kind of graduated from a side project to my home base, I guess you could say.

SFOX: As a frequent trader of crypto, what do you look for when you’re deciding which trading platform to use?

Rob: That’s a good question. Definitely a good relationship with support, but also security. For one, SFOX is based in the U.S., so they’re close to home. Also having a good track record of handling people’s privacy and their funds In responsible ways. And then also offering cutting-edge tools: SFOX gives you an edge over other traders out there.

SFOX: One thing that a lot of people inside and outside the crypto space say is that if you believe in something like BTC long-term, it makes more sense to just hold it than it does to day-trade it or take on and exit positions on a regular basis. How do you decide whether to trade or hold? What has led you to be a day trader, rather than just holding BTC and sitting on it?

Rob: Well, that’s a great question. I do sit on a chunk as well. I employ several strategies: I have a long-term hold; then I have some funds allocated to swing trades of a couple of months or longer; and then as far as the day-to-day goings, there’s just enough volatility and enough opportunity to do that.

For day trading to be your only approach to the market is probably a risky endeavor. So for me, I just find balance in employing a lot of different strategies over different time bands. I kind of have a hand in everything.

SFOX: When did you first get into the market?

Rob: You know, my first purchase was December 2013, right after the bubble — the peak of the first major wave, you could say. I bought the downtrend and continued to buy it for a long time. And then there was a period of sideways, which was boring and frustrating — and out of all the time that’s passed since I started, I’d say that right now kind of reminds me of those days again, where we finally came down to a period of sideways movement at a low, and now it’s picking up again. It feels to me like $300 all over again.

SFOX: You mentioned that you employ a medley of different strategies. Could you expand on your overall trading outlook, philosophy, and the kinds of tools you employ?

Rob: Sure. I guess you could call me a volume trader. I know there’s an endless world of indicators and strategies to employ, but, for me, I’ve just found that simple is good — to not get overwhelmed with too many different things to look at any given time, in which case you might debate yourself over which ones to trust. So I really just study volume in different ways, and I just try to go with where volume’s going. That can work on really short time frames, like, 20 or 30 minutes at a time.

It works for me, basically. It’s a matter of just finding strategies that work for your own psychology. And when I’m day trading, I just like to have results that are kind of “right now”: what happened today in my portfolio, or what happened this week.

I do use only a few indicators; I try to keep my chart pretty clean, and you can see it on the screen here [gestures to charts on stream]. I’ve got your typical volume bar columns, with its moving average. I’ve got something — it’s a little more proprietary, here — but this is kind of based on the Ichimoku cloud, it’s just a little bit newer. It’s a pretty awesome thing, I actually know the guy who developed it. He calls it the “heffae cloud,” and it’s just its own support/resistance calculator, in a way. I also use what’s called the TS Supertrend, something you can find on TradingView, which I find has a lot of useful information. And then probably my singularly most favorite indicator is the VFI, volume flow indicator. So in a sense, it’s giving me a little bit more in-depth, precise view into what’s happening up here, as well.

That’s about it. I really don’t use a lot more; I like Tensor Charts so I can listen to the market, and that kind of just keeps me from looking at screens too much. You know, I can turn the volume up, leave the room, and I can hear when something interesting is happening.

SFOX: Are there any specific timeframes or types of charts that you prefer when you’re making trades or watching the market?

Rob: Yeah. You know, interestingly, when I started trading the futures platforms, I got familiar with something called “open high low close.” And I really like those candles structures, except I can’t get that on TradingView, so I don’t really get to look at crypto in that way. I hope that I can someday — I hope that either TradingView incorporates that here, or somebody else steps up with a similar product.

SFOX: Are there any traders or analysts you follow closely who have influenced your trading strategy as you’ve developed it over the years?

Rob: Yeah; you know, I bounced around, kind of watching different “gurus,” you could say, seeing what I could learn from them. I like a handful of people — I try not to follow too many. It’ll make your head spin if you do, because everybody has their own opinion at every moment of the way.

But I like watching Tone Vays — he’s kind of a goofy dude who’s got some interesting opinions, but he’s been proven to make some great calls. His overall mindset seems to be pretty well in tune with this market. I also like some of the older legends like Peter Brandt; I follow him on Twitter, and I like to hear his opinion because he’s like a 40-year backer in legacy markets who kind of can’t ignore this one anymore, and he has some interesting opinions about it, sometimes, and absolutely great calls. And there’s another one I can’t seem to think of.

But honestly, I get more stimulation from being part of a trading group with a kind of live, ongoing analysis. So, I’m in something called Whale Pool, and we hang out and just talk crypto and market theory all day. I get a lot out about because it’s interactive and up-to-the-moment.

SFOX: Sure, I can imagine that being able to test out and discuss your own hypotheses and work things out with other traders is more useful than just listening passively to what someone else has to say about the market.

Rob: Yeah, exactly. And, you know, one thing about using that group: sometimes in the group, there are some great calls and you get a lot of interesting perspectives. It seems like no matter how many different people look at this thing, they have their own way of doing it. None of us, out of around a hundred people, really trade in exactly the same way.

I’ve learned to not really rely on anybody’s calls: I like the additional perspective and insight, or maybe I overlooked something that’s worth understanding, but I trade on my own calls more than anything. I don’t like the feeling of, “Oh, I followed him into the trade and it didn’t work out; now I’m upset about it.” It’s really a matter of me making the decision on my own every step of the way.

SFOX: What has been your biggest failure in trading? How did you recover from it, and what, if anything, did you learn from it?

Rob: That’s a good question. You know what, I’ll say my biggest failure was probably a single incident that you could boil down to just being too greedy. And I guess what I mean by that is: I have been very dedicated to this space and to this study for a long time now, and sometimes it’s hard to get away from it when the opportunities just keep coming. I think I was overdue for a vacation at one point, and instead of taking the vacation for what it was and putting crypto down for a week or two, I thought that “vacation” meant “trading on the go,” while you’re on the road — managing positions while you’re doing other things. That turned out to be a punishing decision at that time, which maybe spoiled the vacation for me a little bit.

I think the lesson learned there was: give it everything you’ve got, but when it’s time to take a break, actually put it down. Sometimes a little space and a clear head are a more potent tool than trying to make more money in more difficult situations while you’re traveling.

SFOX: What would you say your biggest success has been as a trader, and what did you learn from that?

Rob: I’d say just being diligent. My entry to the space was a bit of a punishing one — I bought into a year-long downtrend; I waited three months when it was sideways. I kept investing in the space, I guess you could say, without a great result upfront. So I think the success that I found was really just through persistence — and even after making bad choices, looking at those as learning experiences and chances to grow.

Another thing is just, you know, being at the right place at the right time: being on SFOX during times of high volatility, when incredible opportunities open up for only short periods of time. It’s like I just was in the right place, you know, dialed in and ready to go — and then it came. It can be a bit of a waiting game for those magical moments that maybe pay off months of wishing or waiting around.

SFOX: You’ve talked about the roller coaster of excitement and emotions that come with owning and trading something like BTC. What are your tips for managing those emotions and keeping them from getting in the way of your trading practices?

Rob: Absolutely. I’ve obviously managed and dealt with those feelings many times over. What I like to do is just make allowances for myself to be wrong. It’s probably wise to first assume that the very next play you make will be wrong, at least for a period of time. So, if you have X amount of money to spend on a trade or investment, just break it into pieces: never go all-in at one spot because then you’re really fixated on this one position and how far wrong you were. If you take that same position and say, “I’m going to average it in over the course of 10 or 20 purchases,” you have a lot more room to average in at a better price. Granted, it’s going to be a longer play, too, because you’re not going to just get all-in at once and get right back out. But it’s a safer approach, where you can kind of account for the fact that you’re going to be wrong and you’re going to need time to be on your side.

So, you know, breaking it into small pieces, approaching one position several times, averaging in. That’s really the key, and the same goes for getting out. Because there’s nothing fun about holding a position for a month or something, finally seeing some profit selling it all at once, and it just doesn’t stop. So always hold onto a little bit of the other, you know: always hold on to a little bit of cash to spend, a little bit of that coin to sell, because you just never know what’s coming around the corner.

SFOX: What kind of goals do you set for yourself and your trading? What are your practices for keeping score on those goals: confirming that you’ve either met them or failed to meet them, and adjusting your strategies accordingly?

Rob: That’s a good question. Well, basically, my ultimate goal is just to earn a living. So I could set the bare minimum as having enough to pay all my bills and have a little disposable income every month. And for me, that’s not really a huge challenge in this space. I maintain X amount of trading capital and as that as my balance gets beyond it, I take a little off and use it to live and pay for things, and I just kind of always resolve it back to that baseline amount. And if things come slowly for a while and I don’t necessarily hit that goal — that hasn’t seemed to be a problem, even in this bear market — if that is the case, however, then I’ll just reanalyze my approach, and, if necessary, I’ll even budget my lifestyle a little bit differently to compensate.

There’ll be times where it’s incredible and we’ll be times where it’s boring, but I guess the ultimate goal is just to come out on the other side ahead in some kind of consistent way. And markets never really tend to work in a way that gives you consistency, so it’s kind of a quandary to want that from something that doesn’t necessarily give it to you. You have to be the difference that compensates for it. It could be like you have one absolutely awesome month out of a year, and the rest of the time you’re just kind of honing your trade — you know, learning your craft a little better. So I try not to set my goals too high, but also to be as opportunistic as possible in the safest and most practical manner that I can.

SFOX: I like what you said about needing to compensate for the market’s inconsistency because you come off as someone who is very relaxed, at peace, and calm — and I imagine that you have to be, in light of what you said about the markets fluctuating so much!

Rob: Yeah — you have to keep a check on your emotions, that’s for sure, because they’re the one thing that’ll tear you apart.

You know, SFOX actually was there for some of my best and worst experiences in this market. I said how this reminds me of the $300 days. Well, there was a period where we came down to that down to those lows, and it kind of held for a while. Months were sideways, and then there was a final test of the bottom — like, the bottom’s bottom — and I was there for it. I remember the price slipping through the 3’s and through the 2’s and then under 2 — and mind you, I started investing at around $1000 per BTC, so I’m 5x under at this point, at least on my highest purchases. I just remember getting to a point where I didn’t know if I could handle it anymore: I bought this thing that fundamentally seems so promising; how could it possibly not be worth more than it is? How could it possibly not be going up? I remember being challenged by the fact that it was not going up, for at least a year.

Anyway, we hit these lows and it just kept dipping, and I was just watching my account be massacred, and I was having there regretful thoughts of, like, “Who am I to think I’m some great speculator, and what am I doing investing in this unproven space?” I had all these very personally challenging thoughts. And it was literally at the lowest point where I was about to start getting very angry — I was about to lose it — and it was about at that lowest point that, all of a sudden, the biggest opportunity I ever faced hit me, right there.

The market kind of just bottomed out — I want to say it was at $165 or something, at the time. And there was just this explosive rally that came to follow, out of nowhere. And at that time, SFOX’s potential for arbitrage and mixing multiple exchanges into the order book finally did it: it finally happened, and there was this huge gap. I was able to cycle my account a couple of times and make a few really big trades. It was just this really sporadic, crazy, unexpected circumstance, right when I was at the brink of giving up on this whole thing. And after the dust settled, I was sitting there looking at my balance, and it was the highest that had ever been. And right then, I was thinking, “Oh my god, patience really pays.” I almost couldn’t handle any more pain, and then opportunity came — and that whole year was suddenly very worth it.

You might not run into that circumstance anytime soon if you’re getting started in the space, but, like I said, it’s about timing: being in the right place at the right time, being patient, and being able to manage your emotions. After that, I kind of learned that all I had to do was wait. Just be there when the time is right; just keep your finger on the pulse. Those moments will come again, I’m sure, because I’ve seen many more of them since then. There have been singular days that made an entire year’s worth of being in a space worth it. So, timing has a lot to do with it, and patience — you know, stay calm, collected, and looking at the bigger picture over the long term. Those kinds of opportunities will come if you’re invested enough into it and you’re aware enough of what’s going on.

SFOX: Do you have a preferred methodology for exiting trades?

Rob: That’s a good question. It really depends on the circumstance of the market — like, what kind of trade I think I’m entering. But I do have a cutoff, I guess. I kind of determine ahead of time how deep into a position I am willing to go, and then I never enter that position in full all at once. I give myself a lot of leeway to accept some pain, but I’d say generally if I’ve lost 10% of the total trade by value, I’ll start thinking about taking an exit — as far as my emergency cutoff, right, because I don’t really want to lose any more than that. And it’s going to actually take a great degree of volatility for me to lose that much after having averaged in. So it doesn’t seem to happen all too often, but I would say I have a dynamic approach to it, for sure.

As far as entering and exiting, I definitely do some scaling, and I like to limit out, nice and easy, into strength. That’s usually my way. I always retain a little piece too — like, at least five or ten percent of the total trade value. I always like to hold on to it until I’m either absolutely happy with the proceeds that are coming my way or really convinced that whatever rally is over for a while. So, yeah, just trying to be flexible with it, not taking too serious or strong of a position at any given time. That seems to work for me.

SFOX: How do you determine directional edge, and are you able to quantify it?

Rob: Oh, that’s a good question. I’d say, for sure, examining higher timeframes and moving averages is the most basic way to do it. It just depends on what timeframes I’m looking at, but that’s kind of what I use this cloud for, in a way. I mean, I’m kind of zoomed in here on a 24-minute — for whatever reason, I like to use somewhat odd timeframes. Most people probably look at a 15- or 30-minute; I look at a 24-minute. I find it gives me, for whatever reason, a really good outlook on things. But yeah, I’d say that I just use my basic layout here. I mean, I use the heffae cloud, and that’s an easy way to determine what’s going on at a glance. That’s the whole idea with it: it’s like, one quick look and you have a determination of which direction things are headed in right now and why.

SFOX: In addition to trading and streaming your trading, you’re also into gaming and streaming your gaming. Given that you have both of these interests and experiences, do you feel that crypto traders could learn anything from gamers?

Rob: Yeah; you know this takes me back to being a kid when your parents told you, “Playing video games all day is never going to amount to anything!” Oh, yeah? Well, guess what? Trading is kind of a game. I mean, it’s game theory, you know: it’s about gaming other people, it’s about gaming the market, and it’s about kind of conquering yourself, in a way — all the emotional hurdles, threats of loss, and fear of failure. It’s very much like a game, and I think that, being a gamer in the past, there is a certain element of hand-eye coordination involved in actually executing trades — especially on SFOX. I mean, I call SFOX the sharpshooter or the first-person shooter of spot trading: it’s rarely made sense to do high-frequency trading with spot, where you’re in and out of positions in really short periods of time, on any other platform. And it works on SFOX, when the situations are right.

So, having experience with gaming and being quick with the coordination… A lot of times, you can have the right idea, but you fail in execution. This is a problem I hear people encounter all the time in my trading group: “Oh, I was in this perfect position — then I hit the wrong button, and it had the opposite effect.” These kinds of things really happen. So, yeah, a gaming background is kind of advantageous in the sense of being quick with the computer, being familiar with the keyboard, knowing how to use hotkeys and macros… Just having proper execution, basically: in the moment, performing when stress is high and you’re computing a lot of things at once — a gaming background is definitely an advantage here.

Thanks to Rob for taking the time to chat with us about his experience as a professional crypto trader, and for hosting us on his stream.

If you want to get the best price execution on your crypto trades, try out “the sharpshooter of spot trading” and open an SFOX account. And, if you want to see Rob in action, follow his trading stream on DLive.