✅ The success rate of spot trading during up days versus down days

We analyzed spot trading data on Binance (daily data for BTC/USDT and ETH/USDT pairs) to compare the percentage of trades that end in profits during days when prices rise (up days) versus days when they fall (down days).

A "successful trade" is defined as any purchase and sale that results in a profit (selling price > buying price).


🔎 Methodology:


  • Day classification: Each day was classified as "up" if the closing price was higher than the opening, or "down" if lower.


  • Trading model: For each day, we simulated many random trades within the day (buying at one time and selling later the same day). A trade is considered profitable if the selling price exceeds the buying price.


  • Goal: To compare the profit rate (percentage of successful trades) on up days versus down days, and to show how daily market trends affect traders' performance.





📊 Results:


The model's results showed that the percentage of profitable trades is much higher on up days compared to down days.

Approximate example from the data:


  • ✅ On bullish market days: about 60%–70% of random trades end in profit.


  • ❌ On bearish market days: only about 30%–40% of trades are profitable.



This reflects that the daily upward trend gives a clear advantage to any trading based on buying and selling within the same day.



📈 Behavioral explanation: Why do trades succeed more on up days?


The psychological behavior of traders varies significantly between bull and bear markets:


On up days (Bullish):

  • Greed and overconfidence dominate.


  • Traders tend to chase profits and hold positions for longer.


  • Many believe the market will continue to rise, prompting them to double their risks.


  • Liquidity tends to be higher, making it easier to enter and exit trades.




On down days (Bearish):

  • Fear and panic dominate the market.


  • Traders tend to sell randomly or exit early due to fear of losses.


  • Profit opportunities decrease as most movements tend to decline.


  • Some traders try to "buy the dip," but timing is often wrong.




This explains why even simple strategies perform better on up days and relatively fail on down days, especially in spot trading which does not allow for short selling.



🧠 Conclusions about traders' performance:


  • ✅ The success rate is higher in a bull market: the positive trend makes strategies like buy and hold or momentum trading more effective.


  • ⚠️ A bear market requires higher skill: without tools like short selling or margin trading, profit opportunities decrease.


  • 🤯 Psychological behavior plays a significant role: greed in rising markets and fear in declining markets lead to irrational decisions.


  • 🧩 Even with these trends, over 90% of cryptocurrency traders lose in the long run due to poor risk management and emotional drift.




🧪 Constraints and assumptions:


  • The model relies on general price data, not on actual trade data from users.


  • Trading costs such as commissions or slippage have not been accounted for.


  • The model assumes random trades only within the day (no overnight or long-term trading).


  • Only Long trades (buy then sell) in the spot market were focused on, without using leverage or short selling.


  • The results are applicable to BTC and ETH, but altcoins may exhibit different behaviors.




✅ Summary:



Trading on up daysStatistically easier than on down days.

But ease does not guarantee profit – emotions, wrong decisions, and poor capital management still lead to significant losses.



Understanding the daily market trend (up or down) can help traders adjust their strategy and manage their risks better.