USDT vs BTC, which one has been the last month's best base coin?
Chart
In this week’s analysis, we are analyzing two Ethereum markets. The first with a stable coin: ETH/USDT, and the second one Bitcoin-based: ETH/USD. That is, a stable base coin vs an unstable base coin.
The chart shows exactly one month in both charts, from December 18th to January 18th. During this month, the Bitcoin price has increased by 38% and the market capitalization of the whole cryptocurrency market a significant 28%. The current scenario is very bullish and, if important levels such $9,200 are broken upwards, the consolidation process that started at the end of June 2019 can end sooner than we expected.
As we can see in both charts, Ethereum has increased in both markets. Even in ETH/BTC, which means that it has had larger increases than the main cryptocurrency. In the section Designing your automated strategy we’ll analyze which market, the USDT or BTC one, has led to the largest return with the strategy selected.
Designing your automated strategy
In both charts, we’ve selected an indicator that you can only automate in Cryptohopper. The RSI with region crossovers. Let’s start first describing how this indicator will open and close positions:
RSI with region crossovers gives the user the option to trigger a buy or sell only at crossover points of the chosen oversold/bought thresholds. This is different from regular RSI, which triggers constantly when the RSI lies in the overbought/oversold threshold set.
If you select (IN), it will react when the RSI level goes from outside of the overbought/oversold threshold to inside of it. Vice versa for (OUT).
By selecting the RSI with region crossovers and its option IN, this indicator will open positions once the RSI goes from the oversold region back into the neutral zone. Likewise, it will close positions when the RSI goes from the overbought region back into the neutral zone.
Looking at the chart, we see the different buy and sell points in both markets. In one month, there has been around the same amount of buy and sell signals in the USDT and BTC market. However, the returns vary across markets.
As we can see, the first chart had an average return of 14.2%, while the second, the BTC based chart, had 5.71%. The strategy has taken advantage of the price increases during the last month in both markets, but the USDT has been significantly higher.
But, why? USDT is a stable coin, so when the coins are rather bullish, the market is very profitable in this kind of pairs. However, if you are trading from Bitcoin, the profitability of trading during bullish trends decreases due to BTC usually increases as well.
Conclusion
Be careful when you trade a bull market with BTC as base coin, the profitability can decrease! At the same time, think about switching your base coin to USDT in this kind of situations, you could highly profit from it!
In this week’s analysis, we are analyzing two Ethereum markets. The first with a stable coin: ETH/USDT, and the second one Bitcoin-based: ETH/USD. That is, a stable base coin vs an unstable base coin.
The chart shows exactly one month in both charts, from December 18th to January 18th. During this month, the Bitcoin price has increased by 38% and the market capitalization of the whole cryptocurrency market a significant 28%. The current scenario is very bullish and, if important levels such $9,200 are broken upwards, the consolidation process that started at the end of June 2019 can end sooner than we expected.
As we can see in both charts, Ethereum has increased in both markets. Even in ETH/BTC, which means that it has had larger increases than the main cryptocurrency. In the section Designing your automated strategy we’ll analyze which market, the USDT or BTC one, has led to the largest return with the strategy selected.
Designing your automated strategy
In both charts, we’ve selected an indicator that you can only automate in Cryptohopper. The RSI with region crossovers. Let’s start first describing how this indicator will open and close positions:
RSI with region crossovers gives the user the option to trigger a buy or sell only at crossover points of the chosen oversold/bought thresholds. This is different from regular RSI, which triggers constantly when the RSI lies in the overbought/oversold threshold set.
If you select (IN), it will react when the RSI level goes from outside of the overbought/oversold threshold to inside of it. Vice versa for (OUT).
By selecting the RSI with region crossovers and its option IN, this indicator will open positions once the RSI goes from the oversold region back into the neutral zone. Likewise, it will close positions when the RSI goes from the overbought region back into the neutral zone.
Looking at the chart, we see the different buy and sell points in both markets. In one month, there has been around the same amount of buy and sell signals in the USDT and BTC market. However, the returns vary across markets.
As we can see, the first chart had an average return of 14.2%, while the second, the BTC based chart, had 5.71%. The strategy has taken advantage of the price increases during the last month in both markets, but the USDT has been significantly higher.
But, why? USDT is a stable coin, so when the coins are rather bullish, the market is very profitable in this kind of pairs. However, if you are trading from Bitcoin, the profitability of trading during bullish trends decreases due to BTC usually increases as well.
Conclusion
Be careful when you trade a bull market with BTC as base coin, the profitability can decrease! At the same time, think about switching your base coin to USDT in this kind of situations, you could highly profit from it!
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