Cryptions

HILO

The adjacent image is of HILO trading.
HILO must be the most simple of all trading strategies where all the trader has to do is forecast whether the asset price, Ripple’s in this case, will be higher or lower at expiry.
The trader goes for higher to start with and hots the ‘HI’ button three times. The forecasts are good as a steep price rise follows the last ‘HI’.
The trader then gets a bit cute by hitting the ‘LO’ button twice hoping that the price will expire between the ‘HI’ and ‘LO’ levels.
Unfortunately the price continues to rise generating three 90% winners and two losers. The trader’s P&L is therefore:
P&L = 3 x $0.90 – 2 x $1.00
P&L = $0.70

HILO is the most basic way of trading on the future direction of the crypto or fictitious asset price.
They are the most simple strategies on offer and they are a very good starting point for the first time crypto trader.
The target level is always the current price so if one were to place a ‘HI’ trade then the price at expiry must be higher than the price when the trade was executed.
In the adjacent image are three HI-LO positions; the first a 'HI' followed by two 'LO' strategies.
The blue circle with an upward pointing arrow indicates that the trade is a 'HI’.
The horizontal blue dashed line is the target level which was the price when the trade was entered into. Therefore the price must be higher than 996.48 at the 'Finishing Line.
The same logic illustrates the following two 'LO' trades.
The red-backed current price (on the right-hand scale) shows 996.43.
The 'HI' is losing with Cash Out amount $0.70; the first 'LO' is winning with Cash Out of $1.80 and second ‘LO’ also winning with Cash Out of $1.79. The price remained at 996.43 until expiry where both ‘LO’s settled at 1.90, the ‘HI’ settled at 0, generating a profit to the trader of $0.80.

HI300

The adjacent image is of the 30 second BTC HI300 strategy.
The concept includes the HI150, HI200, HI500 and HI1000. Like the HILO the trader is forecasting whether the price will be higher or lower than the target level at expiry. Yet in this case the targets for the HI150 to the HI1000 are progressively further away from the current asset price and hence offer increasingly higher percentage returns for ‘HI’ bets.
Here the trader has hit the ‘HI’ button just the once and hoped that the BTC price will be higher at expiry than the horizontal blue dashed line.
The price is actually lower than when the trader executed the trade so the trade lost thir 1tB placed.

We have used the HI300 for this ‘Highline’ example but the mechanics of the bet remain the same for HI150, HI200, HI500 and HI1000.
These five bets have close similarities to betting ‘HI’ on the HI-LO bet. Whereas the target level for the HILO bet is always the current asset price, the target level progressively gets higher from the HI150 to the HI1000. In return the return to trader (“RTT”) becomes progressively higher too.
In the adjacent image are two ‘HI’ bets followed by two 'LO'. bets. The RTT for ‘HI’ is 3.80 and for ‘LO’ it is 1.31.
The price has settled at 987.51 which means the first ‘HI’ has won generating a profit of $2.80 and both ‘LO’ bets have also won generating a further 2 x $0.31 = $0.62.
Including the $1 loss of the second ‘HI’ bets means the trader has made a profit of:
$3.80 + $0.62 - $1.00 = $3.42

LO500

The adjacent image is a screenshot of the LO500. The same principles apply to the LO150, LO200, LO300 & LO1000.
Here the trader has forecast the Solana price will be above the current level three times.
Each percentage return was 19%. Towards the end the trader also hit the ‘LO’ button.
The Solana price finishes above the ‘LO’ strike which itself was higher than the three ‘HI’ strike levels.
So all three ‘HI’s won but the ‘LO’ lost. But since the ‘HI’ only returned 19% per trade this trader’s P&L is:
P&L = 3 x $0.19 - $1 = $(0.43)
The low level of risk requires the ‘HI’ trade to be put on six times (6 x $0.19 = $1.14) to have offset the $1 loss of the ‘LO’ trade.

We have used the LO300 for this ‘Lowline’ example but the mechanics of the trade remain the same for LO150, LO200, LO500 and LO1000.
These five strategies have close similarities to trading ‘LO’ on the HI-LO strategy. Whereas the target level for the HILO is always the current asset price, the target level progressively gets lower from the LO150 to the LO1000. In return the return to trader (“RTT”) becomes progressively higher too.
In the adjacent image are four 'LO' trades. The RTT for ‘LO’ is 1.31.
The probability of a ‘HI’ winning in a LO300 trade is 75% so one would presume these are four relatively ‘safe’ trades, hence the RTT of only $0.31 on $1.00 invested. Unfortunately this trader got unlucky as all four trades lost.
The price has settled at 989.11 which is below the strike price of each trade (which is ‘in-the-money’), but unfortunately ‘out-of-the-money’ to the tune of $4 for this trader.

The adjacent image is a screenshot of a 15 minute Cardano HiTouch HIT200 strategy.
The HIT200 is an example of the HIT strategies that also include the HIT100, HIT300, HIT500 and HIT1000 which have target levels increasingly further from the current Cardano price.
The trader has entered a HIT trade whereby the Cardano price only has to touch the target level for the trade to be a winner. The return is 185% but the current Cash Out is showing just $0.84 which would represent a loss of $(0.16).
If the trader had hit the ‘MISS’ button then the trader would immediately have lost their investment.

Here we have used the HIT200 for this ‘HI-Touch’ example but the mechanics of the trade remain the same for HIT150, HIT300, HIT500 and HIT1000.
These five strategies all have a target level that requires the asset price to (1) touch (‘HIT’) in order to win or (2) to avoid (‘MISS’) in order to win.
In the adjacent image are a ‘MISS’ trade followed by two ‘HIT’ trades. The ‘HIT’ trade would return 185% (2.85) while the ‘MISS’ trade has a RTT of 46% (1.46).
The first ‘MISS’ trade was looking good as the price falls immediately after the trade was executed. The trader then enters two ‘HIT’ trades hoping for a bounce.
No bounce took place so prior to the vertical dashed (‘Trade Suspended’) line the trader has hit the ‘Cash Out All’ button (bottom right of the order ticket).
The winning trade pays out $1.39 (as opposed to the $1.46 it would have got at expiry) plus $0.07 and $0.24 for the losing trades. The trader has received $1.70 for the $3 of trades hence has lost $1.30..

LOT200

The adjacent image is of the 1 minute Cardano LO Touch (LOT) 200 strategy. The concept also applies to the LOT100, LOT300, LOT500 and LOT1000 strategies.
The trader has hit five trades in quick succession: four ‘MISS’s followed by a ‘HIT’.
The initial three ‘MISS’s benefited from a rise in the Cardano price. Then after the ‘Trade Suspended’ vertical dashed line, the price nosedives sharply and in doing so hits the ‘HIT’ trigger level and the last ‘MISS’ trigger level.
The upshot is that at expiry none of the first three ‘MISS’ trades got ‘HIT’ so all won.
The last ‘MISS’ bet got hit and therefore lost.
The ‘HIT’ trade hit so also won.
The trader’s overall P&L in chronological order is:
P&L = 3 x $0.46 - $1.00 + $1.85 = $2.23

Here we have used the LOT500 for this ‘LO-Touch’ example: as ever the mechanics of the trade remain the same for LOT100, LOT200, LOT300 and LOT1000.
The Return to Trader is 470% for a successful ‘HIT’ and 19% for a successful ‘MISS’. Quite a discrepancy but this is because the target/strike level is so far from the asset price when the trade is executed.
The gap between asset price and strike price has attracted this trader who enters four ‘MISS’ trades. Then panics as the asset price tumbles and hits the ‘HIT’ button as a hedge.
The price rallies but then just before expiry the price falls and hits the last ‘MISS’ trade but does not fall enough to hit the ‘HIT’ trade.
The trader enters five $1 trades. Three ‘MISS’ trades are successful and make a profit of: 3 x $0.19 = $0.57. The last ‘MISS’ trade is a loser as is the ‘HIT’ trade so $2 lost there. The net loss to the trader is $(1.43).

DT100

The adjacent screenshot shows three 1 minute DT100 Cryptions500 Index trades.
The firs two trades entered into are MISS trades indicated by the blue up and down arrows with strike prices being the four blue dashed horizontal lines.
A HIT trade is then executed.
The trade has adopted an interesting strategy whereby the HIT trade has both lower and upper strikes within the MISS strikes. Maybe the trader should have entered 2tB as opposed to just 1tB.
This HIT bet partially hedges one of the MISS trades.
Unfortunately for the trader the prices hurtles down through the HIT strike but also the two MISS strikes. Both MISS strikes lose the trader 2tB while the trader makes a profit of just $0.81 from the HIT trade losing the trader $1.19 in total.

Here we have the DT100 where two levels are placed one above and one below the asset price. The trader takes a view on whether the price is volatile enough to hit one or other of the levels. If the trader believes volatility is high enough they hit the ‘HIT’ button. If the trader does not believe the price is volatile enough to hit either levels then they hit the ‘MISS’ button.
The trader in this instance hits the ‘MISS’ button and hopes the price does not fall enough or rise enough to hit the lower target or upper target level respectively.
The price falls precipitously but not far enough to trigger the lower level. The price appears to lose volatility so the trader executes another ‘MISS’ trade.
The price does lose volatility but always stays within striking distance of the initial lower level. The price expires just above the first lower level and so both trades are winners.
The Return to Trader was 81% so the trader makes a profit of 2 x $0.81 = $1.62.

EARN OR BURN

The adjacent screenshot shows the manic Earn or Burn (‘EorB’) strategy.
An EorB trade consists of a two strikes, one above and one below:
The ‘HI’ strategy has a target level above which if hit, without the lower target level being hit first, means the trade immediately wins. On the other hand if the lower target level got hit first then the trade immediately loses.
The ‘LO’ strategy is the reverse: if the lower target gets hit first then the trade immediately wins but if the higher target gets hit first the trade immediately loses.
This trader has executed seven trade. The first four trades were ‘HI’ trades with only the third trade getting KO’d. The next trade was a ‘LO’ which won. But then the trader reverted to ‘HI’ trades with both losing.
The trader’s P&L has laid out $7.00 and received 4 x $1.90.
P&L = 4 x $1.90 - $7.00 = $7.60 - $7.00 = $0.60

EARN or BURN is a super-charged game for adrenaline junkies!
There is a level above and below where the trader chooses ‘HI’ if they think it will hit the above level first. If the trader has hit ‘HI’ and the price hits the lower level before it hits the upper level the trader immediately loses.
And vice versa if the trader hits ‘LO’.
In the adjacent image the trader hits ‘HI’ and then a ‘LO’. The price spikes downwards and the ‘LO’ wins and the ‘HI’ loses.
The trader then hits ‘HI’ again which is another winner.
The price nosedives so the trader hits ‘HI’ again only to lose as the price goes even lower.
The trader is resilient (or stupid!) and hits ‘HI’ again. This time the trader gets the bounce they were looking for and they win.
5 x $1 trades, 3 winners, two losers. So the traders net position is:
$(5.00) + 3 x $1.90 = $0.70

IO100

The adjacent image here of the IN-OUT100 where the trader forecasts whether the Ethereum (ETH) price will be between or outside the current above and below target prices.
The first trade is an ‘IN’ where the trader is forecasting that ETH will be between the above and below horizontal blue-dashed lines. The price falls to below the lower target so this determined trader executes another 1tB ($1.00) ‘IN’.
The position now is that if:

1 - the ETH price is:

a. above the initial trade’s upper target or

b. below the second trade’s lower target the trader loses both trades, $(2.00).

2 - the ETH price ends up:

a. between the two upper targets, or

b. between the two lower targets the trader loses $1.00 - $0.90 = $(0.10)

3 - the ETH price ends up:

a. between the first trade’s lower target and the second trade’s upper target then the trader wins $1.80 as both trades are winners.

In financial markets there is a well-known adage “It is better to be lucky than be good”. This is a good example (and real!).
The trader gets a bit cute and as the time approaches ‘Trading Suspended’ he attempts to place a 2tB ‘OUT’ trade since the upper target and lower target are between the outcome 3) above. This means total loss is now restricted to $0.20 but if the asset price ends up outside the OUT targets but within the outcome 3) targets the trader wins $4.60.
So the trader gets excited and places another ‘IN’ by mistake. But that wins too! So the trader, through nothing but good luck, has won all three trades and collected:
Profit = $0.90 + $0.90 + $2.80 = $4.60
Definitely better to be luck than be good!

The adjacent image here of the IN-OUT100 where the trader forecasts whether the LINK price will be between or outside the current above and below target prices.
The trader has placed an OUT trade meaning they are forecasting that:
1. the price at expiry will be above the upper dashed red horizontal line, OR
2. be below the lower red horizontal dashed line.
The price has not moved a great deal from when the trade was executed so the Cash Out button is showing 0.86 which is likely to be reflecting the previous second’s higher price. It is immaterial since the price has now reached the vertical ‘Suspended Market’ line so the facility to close out the trade has passed.
The trader’s 1tB will more than likely be lost as it would appear unable to generate the volatility required to breach either of the two target levels.