Review and critique my ingenious strategy to earn infinite money magically
I'm new to day trading and I don't know anything about technical indicators. I don't try to predict the price. I'm a programmer in my profession, and this is what I came up with using my brains. Excuse my lack of terminology, and tell me how it could fail:
Basically I short BCH once a day. I sell BCH for BTC, and I buy back the BCH when I can make %1 profit on it, which happens rather easily. My capital is high enough that if I make %1 of it daily, it accumulates to a nice monthly income. I never try to make more than %1 on a trade. I never trade more than once a day. I never reinvest the earnings, I withdraw them and invest the capital again only.
The reason that I'm trading BCH/BTC is that I assume that they will grow or shrink in ($) value more or less together, so their exchange rate will stay within the historical range of 0.067-0.26, so %1 changes should occur usually at least once a day. If I can catch a %1 price change about daily, I'm set. I try to open the position when the price is relatively high (above 0.13).
The worst that can happen is that after I've earned some money with several successful trades, I sell the BCH once, the price leaps, and I never manage to buy it back, so I'm "stuck" with a long term BTC investment, which is fine by me. Then I can buy some more BCH with fiat or with my previous earnings and repeat the process. This should happen rarely enough that when it does, I already earned enough capital to start this again, with my "lost" capital just invested in BTC now. I don't see how I can lose money this way (unless BCH or BTC drop in $ value which is a different matter). I'm safely and gradually earning BCH almost every day.
The reason that I'm day trading instead of just investing long term in BTC (which I also do regardless) is that I can use the earnings from the day trade now as another stream of income.
Am I a genius? Did I come up with something new or does this exist? Is there a name for this? Did I miss some obvious flaw in the scheme? Did I just get beginner's luck?
Thanks for your input =D
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