Crypto Louis

I’m not totally stupid & retweet useful information

[Cred @CryptoCred]

Thanks for all the feedback on the last post.

LLMs are getting pretty smart, but most traders jump towards complex automation of their existing strategies without properly interrogating what they're actually trading.

Trading is hard but you can distil most strategies into a few well-established buckets of market effects.

The dude trading the "SFP liquidity grab into a bullish order block at the Cape Verde Open" and the dude trading the "liquidation at a round number" are trading the same thing but calling it different things.

The valuable part is in the mechanism, not in the label.

If you want to build a proper playbook you need to decompose your setups and understand the market effects that drive them.

I mentioned that you can do this with an LLM but didn't specify how.

Just paste this into your LLM of choice:

You're an educational trading companion. Your job is to lift the fog on what I actually trade.

Interview me one question at a time. If I can name a setup I trade, start there. If I can't, ask for 2–3 recent trades I remember and why I took them, then find the setup hiding in those stories.

Decompose every setup from folklore into first principles:

• the real, well-studied market effect I'm exploiting (momentum/imbalance, forced flow, trend, mean reversion, herding, positioning — not exhaustive; e.g. a "triangle breakout" is really a balance-to-imbalance shift betting on aggressive taker flow)
• the mechanism: who's forced to act, why the flow exists
• when the effect is active vs dormant
• which of my confluence factors follow from the mechanism, and which are folklore
• invalidation that follows from the mechanism

Be a companion, not an examiner. Work with whatever I can remember — mark what's likely vs verified without demanding records or proof.

When we're done, produce my playbook as a single, beautifully designed HTML document with clear visual hierarchy — one section per setup with its mechanism, conditions, confluences, invalidation, and open questions worth investigating. If I paste in an existing playbook, refine it — don't start over.

[Adam @abetrade]

checked my DMs after some time this weekend (mistake), but one questions was about trading book recommendations.

While I believe one of the best ways is just fucking around and finding out, there is lot of bad stuff in this place so here is list of actually good reads to learn about markets and trading.

basics

Options, Futures, and Other Derivatives - Hull

Trading and Exchanges: Market Microstructure for Practitioners - Harris

Option volatility and pricing strategies - Natenberg

Expected Returns: An Investor's Guide to Harvesting Market Rewards - Ilmanen

Leveraged Trading - Carver

strategies

Advanced Futures Trading Startegies - Carver

Evidence Based Technical Analysis - Aronson

Quantitative Momentum - Grey & Vogel

Algorithmic trading: Winning Strategies - Chan

options advanced

All books by Euan Sinclair

Trading Volatility - Bennett

Dynamic Hedging - Taleb

risk/intuition/decision making

The Hour Between Dog and Wolf - Coates

The Laws of Trading - Lebron

Thinking in Bets - Duke

Superforecasting - Tetlock

Thinking Fast and Slow - Kahneman (only psychology book id recommend)

Taleb books

kwant/systematic trading (basics):

Quantitative Tarding - Chan

Python for Algorithmic Trasing - Hilpsich

Systematic Trading - Carver

Trading Evolved - Clenow

on top of that having some math/statstics basics is useful

[Crypto Louis @XckLouis]

@0xSeco BV

[Crypto Louis @XckLouis]

@DonAlt How big % chance do you give the scenario it’s done forever

(Sold this and precious top, and I have this feeling)

[Crypto Louis @XckLouis]

@DonAlt @ColdBloodShill Doesn’t sound unreasonable as the curve is flattening.. I hope we atleast downwards chop to 20-30k to have that 80% decline

[Aporia @0xaporia]

As a retail trader, I accept my role as someone who simply takes on risks that others want to offload. The most straightforward example is trend following: you're getting paid to provide an exit for traders who recognize a potential trend but aren't willing to wait and see if it materializes. They understand that most trends fail to follow through, meaning a drawdown is typically imminent. By buying their position, you're taking on the risk they want to avoid; the risk that this setup, like most others, won't work out.

This transfer of risk is the fundamental source of your potential profit. When you buy a trend signal, for instance, you're taking on a position that other market participants know statistically fails more often than it succeeds. Your compensation comes from your willingness to bear this unfavorable probability that others are actively trying to avoid. You're effectively serving as exit liquidity for their risk management needs. At least, that's how I like to think about it.

[Crypto Louis @XckLouis]

@donalt What coins are you shorting?

[Adam @abetrade]

ETH sentiment index is also available on @kiyotaka_ai

btw, I had some questions about how to access this. The platform is free, just like all the indicators I published there, so no need to pay or subscribe to anything.

[Cred @CryptoCred]

I fixated on R:R when I started trading

It looks good on social media to have a super narrow stop and/or huge target

But it doesn’t actually work

First of many new, high quality educational pieces I’ll be posting on Breakout 🫡

[Crypto Louis @XckLouis]

@cryptorangutang If we truly go up after all this, it’s the ugliest way possible and people still in positions deserve every bit of it

I sold 90% of my spot (ENA @ .68) a few weeks ago. Been a very good cycle for me and with this kinds PA I might not even regret it if we still go up

[Crypto Louis @XckLouis]

@goliverasf @godeLives Not any apparently

[Crypto Louis @XckLouis]

@Crypto_Chase @SquirtleCharts “Set mnav > 2.5+ in order to ATM” haven’t read about this and don’t know what it means. Sounds important. Do you have a link or can you please explain?

[Innerdevcrypto @Innerdevcrypto]

If you interested in growing food and:

- do not want to weed
- do not want to spend more than couple of hours a week ´working´ in garden
- want low maintenance & high yields/harvests
- want chemical/pesticide free food
- want to mainly relax and enjoy
- have no idea how to begin

[Adam @abetrade]

By the way, here is the indicator, as I mentioned, it's free. I will do some updates later on so you can adjust the settings yourself, as I believe this can also be quite useful for short-term mean reversion strategies.

https://t.co/49zuAJjh5P

[Crypto Louis @XckLouis]

@Tradermayne ENA 🙏🏻

[Crypto Louis @XckLouis]

@George1Trader ENA most def

[Aporia @0xaporia]

Altcoin Market Share vs ETH/BTC

Setup-Guide for you to bookmark
1) Create a blank chart: e.g. TOTAL/TOTAL*100. You can hide the ticker, we don't need it.

2) Add the ratios one by one (tickers below):

Alts (excl. ETH) as % of ETH Marketcap
(CRYPTOCAP:TOTAL3-CRYPTOCAP:USDC-CRYPTOCAP:USDT)/CRYPTOCAP:ETH*100

Alts (excl. Top 10) as % of ETH Marketcap
CRYPTOCAP:OTHERS/CRYPTOCAP:ETH*100

Alts as % of BTC Marketcap
(CRYPTOCAP:TOTAL2-CRYPTOCAP:USDC-CRYPTOCAP:USDT)/CRYPTOCAP:BTC*100

Alts (excl. ETH) as % of BTC Marketcap
(CRYPTOCAP:TOTAL3-CRYPTOCAP:USDT-CRYPTOCAP:USDC)/CRYPTOCAP:BTC*100

ETH as % of BTC Marketcap
CRYPTOCAP:ETH/CRYPTOCAP:BTC*100

Alts (excl. Top 10) as % of BTC Marketcap
CRYPTOCAP:OTHERS/CRYPTOCAP:BTC*100

3) Make sure all of them are on the same scale.

What is this?
Each colored line represents the percentage share of different altcoin baskets (excluding stablecoins) or ETH relative to either the ETH or BTC market cap (can add more, e.g. SOL or create different dashboards with Memes, AI, DeFi, you name it)

What can it be used for?
I know: At first glance, this may seem noisy and complex, but it all depends on the questions you want to answer. Once you define those, much of the noise becomes irrelevant, allowing you to simplify the analysis and focus only on what matters to you. What I’ve done here is provide a few initial insights that I found useful (will isolate a couple of them in future).

This analysis doesn’t tell you which specific coins to buy, but rather provides a broad market overview as a foundation. It helps guide you toward areas of relative strength or weakness.

I’ve included a lot of information here, but the key is to extract the signal from the noise by asking the right questions, for example: At what point do altcoins become overvalued or undervalued against Ethereum? However, when asking these questions, it's important to remember that an overvaluation or undervaluation of Ethereum relative to altcoins tells you little about its valuation against Bitcoin or USD. These are separate questions further down the process.

[Crypto Louis @XckLouis]

@abetrade @CryptoCred Haha you sick fuck

[Crypto Louis @XckLouis]

@ThinkingUSD @donalt You and anyone who believes you doesn’t know DonAlt or is dumb as fuck.. almost think it must be one of the saddest engagement post I’ve ever seen. Fuck you Flood