For these people, it was.
23%,
67%,
100% profits.
These members of Finova did it by
shorting crypto, profiting off the decline.
You're probably used to praying for prices to go up.
So shorting Bitcoin feels weird, like now I want
it to crash and the deeper the better.
It's strange.
which feels like 24/7 if you look at the news.
Of course you need to know about the dangers too,
because getting it wrong can be a disaster.
and then I'm gonna reveal some
Okay, so let's imagine that you want to
make money on some good old Bitcoin.
There's a couple of questions you need to ask yourself first.
Personally, I think it will rise in value
and I just want to hold on to it for years.
But not everyone agrees.
- Well, I think that sucker's gonna crash,
so I'm going to short Bitcoin.
- Okay, so there's more than one way to
skin a Bitcoin because I think price will go up.
I'm just looking to buy some Bitcoin and hold
onto it and just hope that prices rise.
It's just like a straight purchase of anything that
you buy - food, haircare or other essential goods.
This type of purchase can work both
for quick trades or long term investment.
For every dollar it rises, I earn a dollar in profit.
It's still risky though, because Bitcoin.
But the other guy is taking a way
bigger risk than me by shorting Bitcoin.
- I'm betting that Bitcoin is going to lose value.
Now I don't really care if it's genuinely
overvalued or if it's likely to fall for
a while and then rise again.
I just want to see it drop so I can cash out.
Now it seems a little bit complicated, but
all I'm really doing is borrowing Bitcoin to
sell it at current market prices.
Then I'm hoping for the price to fall because I can
then buy it back at a lower price, return the Bitcoin
to the lender and pocket the difference as profits.
- Why don't you tell them about the terms they need to know?
- Jesus, I was just getting to that part. Let's be honest,
you just want to make money.
You don't really care about the vocab.
But I suppose I'll cover
Let's say you hold an asset and it hits an all time high.
You can open a short position
on that asset to help
protect you if that price
were to drop in the future.
But personally, I'm just doing this to make some cash.
- Come on, don't put that on the list.
All right, moving on.
So if you're trading $1,000 at 3X leverage, you
actually get $3,000 worth of exposure to that investment.
That means for every 1% the investment goes up,
you're actually making 3%.
However, there's more to the story, because
Not only are your profits increased by 3X,
but so are your losses.
This can also lead to a liquidation.
If you're sitting in a position that's 3X leverage
and that position goes down 33%, you lose everything.
Again, because of 3X losses, 33.3% x 3
is 100% of your investment gone forever.
- Well, technically it equals 99.99%.
- Just stop.
The point is, just avoid getting liquidated.
What's much more interesting than repeating nines
is that you can short all sorts of things:
stocks, commodities, cryptocurrencies, monkeys.
- I think that last one might be illegal.
- OK, don't tell PETA then,
but the concept is the same.
You're betting on price dropping.
- Oh, tell them what the short squeeze is.
- Okay, I was getting there.
Let's imagine a bunch of people are
holding short positions on an asset.
They all want the price to fall so they can
buy the asset back and close the position, pocketing some
cash, but it starts rising instead, people begin to panic
and they rush to buy back in at a loss.
They do this because they want to avoid an even
larger loss, but this causes the price to rise even
more, which causes even more shorts to buy back.
And this creates this kind of vicious cycle
of price increases called a short squeeze.
It's wonderful if you're just normally holding an
asset, but it's a disaster if you're shorting.
Sorry to interject, but I need to
tell you a story about Piggly Wiggly.
Seriously. Piggly Wiggly, the 1920s.
This was a supermarket chain
owned by Clarence Saunders.
It was the first modern supermarket and successful enough
for Clarence to build a big pink mansion.
Anyways, the business was all over headlines
for the wrong reasons, and Wall Street
traders decided to short the stock.
However, Clarence had a salmon-toned chateau to protect,
so he fought back.
He took out a $10 million loan to
buy huge amounts of his own stock.
He bought as much Piggly Wiggly as he could possibly
get his hands on, and this drove the price from
$39 to $124.
It was a bold attempt at creating
a short squeeze, and it almost worked.
But the shorters got out by the skin of
their teeth and Clarence sadly lost it all.
So this kind of thing is unpredictable
and brings massive risk to everyone involved.
- Fun story.
- Oh, hey, while you're helping out my girlfriend
with that computer problem at your apartment yesterday,
I put together this little animation.
- Sure. ????
- Yeah, it's crazy how her laptop seems to break every week.
Anyways, let's say Bitcoin is at $20,000.
You borrow one Bitcoin and sell right away for $20,000.
If the price drops to $10,000, you'll happily buy it back,
and give the Bitcoin back to the platform that
you borrowed it from, giving you $10,000 in profit.
But what if the price in
our example had risen to $30,000?
You'd still have the $20,000 from the sale,
but you now need to find an extra
$10,000 to buy back the Bitcoin you owe. Not good.
You could buy it back and take a hit.
Or maybe you'd wait for the price to drop again.
That's shorting.
Nice, dude. You're done.
You're done, right? Okay.
We can show the people how to actually do this.
I'm going to be using Kucoin to show you how to do this.
If you want to try them out, there's
a discount link in the description below.
Go ahead and try them out.
When analyzing the market, you'll be looking
for things that suggest that the price
is going to tumble in the future.
This could be some technical indicator, problematic
news, rumors of regulatory changes, developmental issues,
whale selling, china banning crypto for the 17th time,
or anything, really.
I'll cover some advanced profit taking
techniques for this in a minute.
But first, let's head over to Kucoin.
The simplest way to short is with leveraged tokens.
On Kucoin, you simply go to Trade > Spot trading.
Now, this looks super intimidating at first, but you really
only need to look at a couple of things.
Click the asset up top and type in BTC3S
This means you're buying a token
that is three times short Bitcoin.
Then, for the sake of simplicity, I'm
doing a market order worth $100.
Click Buy and you're good to go.
Now, for every 1% Bitcoin decreases, I will
make 3% or $3 on this $100 investment.
If I purchased $3500 worth, I would
have $10,500 in exposure to this market.
And that means at just a $3,500 investment, if Bitcoin
dropped 10%, I would actually make $1,050 in profit.
But remember,
and this is theoretically unlimited, so please be careful.
And these are only meant to be
held for 24 hours or less.
But this is by far the easiest way to get started.
For more advanced options, you can use the
Margin account or Futures account on Kucoin.
We're going to cover Margin.
One this page, you can see the order book on the right.
That's who's selling and who's
buying this particular asset.
The current price of Bitcoin is sitting right in
the middle of that order book, around $20,000.
Right now, the bottom right hand corner
is where you carry out a trade.
Make sure it says margin there
if you're trying to short.
Now, remember
This means you pay an
That rate can get expensive if you keep
the position open for a long time.
In order to simplify the borrowing process, make sure you
check the box for Auto-Borrow and Auto-Repay.
Now, in order to make a trade, you
first need funds in your margin account.
Do that by clicking the transfer
icon and making the swap.
I'm doing $100 for this example.
Now we're going to the Sell tab in the bottom right.
You can see the margin is currently set to 5X.
So my $100 deposit shows $500 in USDT available.
That's my buying power.
Now, in order to short, we need to go
over to sell Bitcoin, and this is in Bitcoin.
So we have to bust out the calculator to figure
out the specific dollar amount that we want to short.
To do this,
So if we wanted to short $100 worth, I would take
100 divided by 20,645, which equals 0.0048 BTC.
You then need to choose between
Limit order and Market order.
Let's say you see support here at $20,717 where you
think it's going to touch before going down in price.
You then enter that price where it says USDT
and enter our Bitcoin amount of 0.0048 BTC.
Click confirm, and here we can see
the trade details and the interest charge.
If Bitcoin doesn't reach that $20,717 price that
you noted, this trade will not be executed.
And you can see all your open
orders in that tab down below.
Using a market order is the opposite approach.
This is useful when you think that the
downward movement in price has already started.
Maybe there was some news event or something that just happened
that makes you want to get in in short ASAP.
So choose market order and enter the amount
of Bitcoin that you want to buy.
Now when shorting, you want to
make sure to protect yourself.
If the price goes up too much,
you can lose a ton of money.
So you can limit your downside by placing a stop order.
This will sell the position if it goes
up to any specific price that you choose.
Okay, let's say you've made a nice profit
and it's time to close the position.
How do you actually do this?
The easiest way is with a market order.
This time, instead of selling Bitcoin, you're going
to buy it in the amount that you'd
like to close the position on.
If the Auto-Repay option is ticked,
the system will automatically repay everything once
it sees that you have enough funds.
Or you can choose to repay manually.
You do this by using the Replay
button, choose Bitcoin, check the figures and
confirm, and that's how you short Bitcoin.
Now, to finish this off, let's cover a couple
Here is the net unrealized profit chart for Bitcoin.
This chart essentially tracks how much the average
individual Bitcoin investor is in profit or loss.
When the indicator turns red, the average
holder is holding at a loss.
For example, right now the average
holder is actually down roughly 30%.
But historically, whenever the line in this chart turns blue,
which you can see at the very top of the
peaks, it's a good time to think about shorting Bitcoin.
The reason being it represents when the majority of
holders are in a large amount of profit and
what happens when so many people are in profit
they start cashing out and the price of Bitcoin
plummets as people escape the market.
Now, the next indicator is a little bit more
advanced, but when mastered and combined with technical indicators,
this can provide some awesome insights as to when
the best time might be to short.
It's called the
What it basically does is track the historical volume
of an asset to provide you with important areas
of interest where traders and investors tend to trade
the most, where is volume the most heavy?
These are marked by the arrows. See when an
asset's price is currently trading in these areas,
prices tend to stick in those zones for a
while, and once they do break out, they like
to move rapidly to the next area of interest.
Now, when we throw the price chart on top,
we can see just how quickly prices like to
move from one area of interest to the next.
Here's one of our Finova coaches, Kyle,
explaining how he uses this chart in
combination with other technical indicators.
- And the moment that it does, this
is when you can enter a short.
Because not only are we breaking out of an area
of interest where people like to trade, but we're also
breaking out of a double top formation that's also bearish.
Believe it or not, he actually does
trade signals every day within our group.
And this is in addition to daily coaching calls,
research reports, and a massive community of successful investors
that will be linked down in the description below.
And we actually offer a seven day free trial if you wanna try it out.
But it's just extremely important to
understand the risks of shorting and leverage
before you do anything crazy.
So just please be careful.
And if you're sitting there wondering about
the technical indicators that Kyle just mentioned,
I have just the video for you.
On screen is my technical analysis
for beginners completely free course.
It actually just passed a million views, so
just make sure you check that out next.
I'd like to thank you so much for watching,
and I hope you have a profitable day!