Bitcoin Forum

http://s12.postimg.org/syq387ewd/zbitfinshorts_Untitled.png (http://bfxdata.com/swaphistory/btc.php)

I am not verse with various financial instruments. Can u plz explain in short what are these Shorts, Futures are ?

It means people have borrowed and sold on the market a total of 28531.03 bitcoins hoping to buy them back at a cheaper rate and take profits. It also means these bitcoins will have to be bought back on the market at some point.

What is that likely to result in, a crash or a pump?

Alot of the shorts are also mining farms that sell un-mined BTC ahead of time to protect their investment against a price crash.

So what predication we can make will the price raise or going to get down

Odds are good that the price will go up.

up in the sense of a cat bounce like last time with the 300 peak? the sub-trend seems one pump and then one dump, while the general trend seems a small correction toward the bottom(cause by the fact that the dump is stronger than the pump in the end...), at least in this despair phase, in the future there could be a reversal if something good will happen.

well what goes down must come up lol, at the moment it would be suicidal for these shorters who are pushing down at the current range :D Currently the graphs are looking realtively ok for a short pump as volumes are increasing and capital is flowing :D

Expect those shorts to get squeezed.

Yea ~215 was the bottom of the dump. Going up since and the shorters not buying back now will be squeezed in a couple of days. Happy trading!

I don't know what is the reason but the sentiment is strong this time round as traders are putting on high expectations for the price to fall in weeks to come. I try not to think negatively but usually what is saw here is normally the natural buildup towards the upcoming price dump.

Bastards.  I knew they were just waiting for a better price.

Not unless it's a dead cat bounce (again)...  Which has become a pattern of late.  Maybe this predictability made the shorts bet high this time?

Lol.. is the volume during the short pump increasing for you?  https://bitcoinwisdom.com/markets/bitfinex/btcusd (https://bitcoinwisdom.com/markets/bitfinex/btcusd)

It's decreasing actually.  It only increases when ever there's lot s of people selling off.

Not to forget: the longs are extremely high, too (as they have been traditionally).

Ratio of longs to shorts is: 25860000 USD / 28940 BTC = 893 USD/BTC.

However, ratio of delta in last 24 hours is: (25860000 - 25660000 USD) / (28940 - 27600 BTC) = 149 USD/BTC

Once you think you found a pattern in the market, the market will turn around and screw you for most pain. ;-)

That or some wise ass mother fucker is gonna manipulate the market to go down and is stocking up all his shorts for one final push (down).

Either way, I don't care who's right anymore...  The falling price is hurting everyone...  Except the shorts.  ;D

edit and the falling price isnt hurting the hodlers lol, we are in it for the long temr so this short term manipulation is just a hitch in the big picture lol :P

if that is the real bottom, then we are increase with a good price corretion, because the last bottom was 180 a month ago, $35+ in a month isn't bad at all


as long as the falling price is higher than the previous falling price, than holders should feel safe

It's hurting in the sense that it's making BTC look like an unattractive investment.  It's hurting the miners, the small merchants who are willing to hold BTC and I'm pretty sure it's hurting the community as well because the mood is bearish.

yep thats apparent from all the doom threads lol, Bitcoin has received a lot of smack from investors because of the depreciating value :*( those relying on Bitcoin for fiat value are getting hurt :(

Those relying on Bitcoin for fiat value need to rethink their concept of "value". What we need is a Bitcoin-only economy, where producers, suppliers, merchants and customers all use BTC without fiat conversion. Then these problems will disappear. Current economic actors should explore all available options to make steps in that direction.

Shorting Bitcoin will not work out longer term. Most of these traders will get burned sooner or later. Expect a violent upside movement when these shorts get squeezed.

ya.ya.yo!

It should start from the miners.  But how can they maintain their operations without converting to fiat?  I think no one anticipated BTC's industrial mining to happen.  In a perfect scenario it's the people themselves who get rewarded directly by supporting the network using their home PC's.

And who says the shorts are shorting for the longterm?  They are just following the trend.  And right now the trend is down.  The minute that reverses they cover and make a little profit.

Yeah...  That's always the case.  Which brings me to another funny thought.  We know that some people like to fud to bring the price down in order to get in lower.  What if some people also like to hype in order to short higher...?  

That explains the all time high of shorts and all the hyping going around here.  ;D

Shorters will get their ass margin called within 30 days. ;D

Exactly what I'm saying...  This is the kind of thing a shorter would say or what shorters want people to be saying.  They want the price to go slightly, giving them an opportunity to short higher.

Well I'm a trader and I go both long and short but for now I'm legitimately long since ~215. My last short was at 250.2

But you are right about everyone on here having their own personal agenda. ;)

better lock your profits from this bounce.

If you want to judge the sediment you guys are using the wrong chart.

https://bfxdata.com/sentiment/longshort

My last short was at 290 closed at 260 (good trade), then I went long at $250ish (BADD trade)... I suck at trading LOL  :D

Yup... ;D

Pump, even tho it can always backfire and turn out worse, but all indicators are pointing towards a recovery lately. Definitely a good time to try to amass as much BTC as possible.

This chart from your link suggests to me that the ATH of BTC swaps was around mid January when the big crash happened. Is my interpretation correct?

http://s8.postimg.org/hyz31dt1h/chart.jpg

Funny saying this as Bulls are on the verge of being called.

I hope not, I'm making money offering BTC for swaps ;)


Let me guess, you're shorting as we speak.

yes, the previous ath seems to have been on Jan 15th.

https://i.imgur.com/y0ZWWzH.png (https://i.imgur.com/y0ZWWzH.png)

BTC swaps reached ~ 27 kBTC and price dropped to $180 ($160?). ~30 hours before price was at $230 and the shorts at 18 kBTC. So while the shorts were being built up, the price dropped. That's in contrast to what is happening now: price is more or less stable while the shorts are building up.

Doesn't matter that much if shorts measured in BTC are at ATH if their USD value is only $5-6M (since price dropped 70% or whatever since price ATH) compared to the longs that are at $26M.

Some of the shorts might have been just reserved, not actually sold yet.
And compared in $ with the longs, they are a small fraction, might just damped the fall.
I am not shorting yet, waiting for a low risk / high (not highest, obviously) reward entry for my planned short.

I have new shorts opened at 225 and old ones at 254 both on 20x

I only have 400 open at 225, 700 at 254

Ok, then you might not like what is going to happen in the next couple of hours (price is at $226 per coin as we speak).

Why so sure?

20x leverage??

Can I ask what price your lower short (@225) would be liquidated should the price rise?

https://i.imgur.com/h1JDHRA.png

 :P

About 236ish without buying more

Just like on Thursday right?  You do know that was a manipulation show correct?  Same show was on Wednesday as well. 

Over 30K shorts. There isn't enough coins for sale to close those shorts out. If they cascade close we could see million dollar coins!

This makes me realize shorters are not smart.

What the hell are you talking about.

Shhht, he smart. You should not disturb him while he is using his bitcoiner brain to find new possibilities on how to get BTC above 300 again.

To close out those shorts coins have to be bought back. They have around 20K coins on finex for sell. It was a joke about million dollar coins, but just wanted to point out there are more shorts than can be closed. Or am I missing something?

If I borrow something and sell it, and then I have to buy back in able to return what I sold but there isn't enough out there no matter the price, what do I do?

Also, I don't need bitcoin to be above 300. I want as many coins as possible, shorters are helping me accumulate. But seeing the order books I would not short myself.

Question is... Are we looking at new MtGox?

They would close into the 100k+ BTC that have been opened as longs.and need to close at some point.. ::)

However, sooner or later Bitfinex will implode and bulls and bears will get burned at the same time. :)

You mean they would buy back from the open longs that MIGHT be for sale? Hopefully somebody is closing their long in the price range before you get margin called. If it's cascading you won't even have a chance.  ::)

Not worth the risk if you ask me.

how will it implode?

The same can easily be stated for those longs being margin called,  not enough bids.  price would also implode

Due to the fact that longs can be opened with BTC as collateral. The lower BTC/USD price gets the more dangerous it becomes. I explained the situation a few weeks ago, I'm too lazy to write it again. My guess was that@ around 80-100$ the lights will go out for Bitfinex, as probably most of those longs have been opened with BTC as coll.

True, but there is far more money on the exchange that is not on the order books. 90% of my fiat is not on the order books, so who knows how much is out there waiting to pounce on a long squeeze. While there may be many coins not on the order books I doubt it even comes close to fiat. All my coins are on the order books at a very high price just in case there is a flash or error and I get "overpaid" for my coins. The reason I don't do the same with my fiat is I don't want anyone to think there is support and hopefully they sell and bring the price down to a point in willing to buy at.

Doesn't their algorithm work in a way it takes btc price into account? Let's say you use btc as collateral and open a long, it says you will get margin called at $120, that means at a price of $120 your btc worth $120 each will not be enough to cover your loans. It doesn't work as if btc price is now $220 so you have $220 worth of collateral no matter the btc price. That would be just plain dumb.

Would you mind giving the link to your post? I'm interested as I use bfx.

That would be assuming the shorters don't short again after closing position or that people in long positions don't close their longs as the price rises. However as the price begins to rise from other closing their position new asks will be placed on the orderbook.

order book is never 100% accurate

As I said in the wall observer thread, I understand this, but if it's cascading there is no time for any of that to happen. 30K shorts will close into 20K asks before a single trader with a long decides to sell, a shorter decides to reopen, or new asks appear on the order book. This happened at bfx before with the long squeeze to 100. Although unlikely, still dangerous.

Anyways, I'm out, hopefully we have some fun tomorrow!

Are there take profit orders on Bitfinex? Some longs might be set to take profit at a certain price level, providing liquidity.
Also AFAIK Bitfinex has a system in place to prevent flash crashes/rises since that flash crash to $100.

There's a rate spike yesterday... was it really 4% avg rate for a BTC swap? That seems insane.

https://i.imgur.com/pdeqHqQ.png?1

The bulls don't have a monopoly on idiots.

Bitcoinica??

Zhoutonged??

Oh no bitfinex be closed, all our coins are gone they got "hacked"  we will return shortly don't worry!!

We will make it all good including that last 7% per week.  Everything is fine..

Than means it is good to invest in BTC swaps if I want to earn money? Or is this market gonna crash?

I love this... I know swaps have proven to be a quite bad indicator of impending movements but longs still going down and shorts this high... At some point they will have to close. And if we go down even further there'll be enough buying pressure to kick us out of the 2014 downtrend for sure!

As long as BTC keeps going down, they will not close. 

Sure they will. People who make money close their shorts from time to time, so as not to lose money in an upwards-correction. But if shorts continue to pile up, this may lead to a cascade at some point, wiping out many positions at once. One hell of a sight :)

Again, we'll see.  This could go either way.  The important thing is always be ready whatever direction the trend goes.

I was wondering about this actually...  Why don't the other exchanges offer some bitcoin to be loaned for a fee.

there's OKcoin but not too sure how they work

Their future markets seem to behave a bit funky these days, aren't they? I wouldn't be surprised if at least one Chinese exchange pulled a Gox, or at least a Stamp at some point this year or maybe next year.

Wouldn't that be bad for Bitcoin's price and another stain on the way it's percieved by the mainstream?

Yeah, that would be terrible, sure. But it wouldn't surprise me much. This is still very much 'amateur hour' like many people like to call it. We need more insured and regulated exchanges!

No wonder people are shorting...

?  Like Mt.Gox kind of gone?

to me this sounds like its going to turn sour. as the exchanges are not regulated etc essentially people cannot tell what is real inside what the exchange is doing. that is how the market got goxed.

with all this shorting I am sure the exchange itself is tempted if not actually doing something for it to clean up big time itself as a player in its own market place.

if playing poker would you allow the dealer to choose how many aces were in the pack and not just the "proper' number of 4.

I see blood everywhere.  

Yesterday there were huge spikes (now they are back to normal) in both BTC and USD swap rates, was it a glitch or is there some explanation?

I'm not sure, didn't see the swap market order books at the time.

They look healthy now with 2.4 kBTC and 2 million USD offered at "flash return" rate and more at higher, but still "reasonable" rates.

https://i.imgur.com/FtzgkIS.png (https://i.imgur.com/FtzgkIS.png)https://i.imgur.com/2LHAFB2.png (https://i.imgur.com/2LHAFB2.png)

I'm having a hard time imagining those orderbooks being empty on the ask sides and people borrowing at 4% / 9% per day (as depicted on bfxdata). That'd be 1.6 million % / 45 trilliion % annualized !! So I'm guessing: glitch.

A recording of the presumable glitch.

https://i.imgur.com/JKuMVX5.png

zoom in!

enhance!

https://i.imgur.com/oWdYrKW.png (https://i.imgur.com/oWdYrKW.png)

shit! it's still just one data point. Another indication that it's a glitch.

This doesn't necessarily mean anything in terms of a price swing if financial duration isn't given.

For example, a currency swap market with high volumes of contracts but also high ModD would naturally be exposed to a lower level of volatility, but the same market with a low volume of contracts and low ModD would likely be prone to significant price swings.

I don't see where this 4-9% interest per day is coming from when the swap rates are hovering around the .04% level. I'd love to have that higher interest on the coins I'm lending.

Those numbers come from bfxdata.com as seen in the graphs tzupy and I posted. They were recorded from bfx api by bfxdata.com site.

You're not going to get those rates. I'm assuming it was a glitch and noone really got them.

You can also assume that if someone indeed borrowed at such high rate, he would roll over into a more modest setup at the first chance (and there is now a "healthy" swap market with "normal" rates available as you can see in the 2 screenshots of the ask side I posted yesterday).

If someone offers you 9% per day, RUN! Even 7% per week (example taken from bitcoin savings and trust) should ring alarm bells.

It is happening!!

How are the shorts holding up?

quite well:

https://i.imgur.com/zy1hnq4.png (https://i.imgur.com/zy1hnq4.png)

no squeezing on finex yet... not to be expected anyway. Just a $10 move so far.

not for a long time

Short % of Float

Bitcoin: 0.2%
Altria: 0.70%
Apple: 1.10%
Citigroup: 1.10%
Kraft Foods: 1.60%
Freeport-McMoRan: 5.30%
AT&T: 6.20%

Ha, good to see there's still a lot of fuel in the rocket. I wonder whether a sizeable portion of those shorts get cold feet now and close their positions before they get margin called in a similar manner. Good to see this, for a change...

Where do you get these statistics on regular stocks?

Lot's shorts were squeezed.  That's what they get for being impatient...  And being indecisive when it broke down 250.

Most informative post I've read on Bitcointalk in ages. I had no idea so many people were shorting Apple! Where did you get this info?

$242-$245 I'd bet.

I'm thinking much higher ($320 to $350, maybe even higher), but that's totally unfounded in any rational thought.

Yeah I was surprised by this, as well. I think people may be using a relatively low margin. I suspect AAPL to be quite overvalued for some time, already. Their rise just doesn't seem reasonable, especially concerning their quality apparently declining over the last couple of years. :(

Sorry for ignoring the questions about my source.  I don't check these threads often.

I get this data from the "Key Statistics" in a Yahoo Finance quote: http://finance.yahoo.com/q/ks?s=AAPL+Key+Statistics

Lots of information can be gathered there.  You would be wise to check the debt amounts and return on assets amongst other things before investing in any stock.

As far as people saying that Apple is heavily shorted, if you look at the info provided, you'll see that Apple is actually not shorted very much.  1.1% is in line, or below what you would expect from a stock.  Freeport-McMoRan on the other hand, is being heavily shorted as sellers take advantage of falling crude prices.  Altria has a ridiculously low short % at 0.7% and Bitcoin's short % by comparison to stocks is outrageously low.  That was the point of my post.  I think we could see the short float go up by as much as 10x before it gets to point when it becomes dangerous.  I wouldn't think we'd see a true to the moon short squeeze unless we had a float of around 5%, or about 25x what it is currently...  However, this is assuming that bitfinex is the only place to short Bitcoin.  I suspect there are many other sites offering this as well, so it is quite possible the true Bitcoin short % of the float could be much higher, especially if you take into account the "lost bitcoins" that surely exist in high numbers.  Most regular people I send BTC to end up saying they deleted their wallet after not wanting to use Bitcoin anymore.  I can't tell you how many times I've heard, "it was only a couple dollars" as the reason why they didn't bother doing anything with the BTC before abandoning it.

That being said, Bitcoin is a little different, much more rare, harder to track, & less shorted due to it's nature.  In comparison to stocks, we have a long way to go if these numbers are accurate before a short squeeze is even a thought.  In comparison to other digital currencies  ???  who knows.  Time will tell the story.

TL;DR

Only god knows how many BTC are truly in circulation or how many different sites allow shorting them, but a good guess is that short sellers aren't in the danger zone yet.

Apple is flying at the moment, the iPhone6 and 6+ sold massively moving them to a whole new level.
If I was going to short apple, it would be due to the apple watch, along with a lack of any new product in the last 5 years (other than the rubbish watch!)

Bitcoin shorting is a lot more dangerous than shorting apple though, the % swings in Apple are tiny in comparison to a big bitcoin move day!

Thanks OgNasty. Very informative and educational post!

Short on ATH is a good thing isn't it?

Means they will need to buy them back sooner or later.

Yeah I know their products are selling very well, everyone claims that their next release is going to fail again the number exceed the supply customers have to wait four weeks until their product arrives. I also have my doubts about the watch but it seems to so pretty decently.

Wow, you really seem to know what you're talking about. I'm really new to all these things. But I really like to get to know more. You are saying that the shorts of Bitcoin are quite low in comparison? I think we have to consider that not all kinds are on the exchanges a lot of them are in cold storage, isn't that right?

The 0.2% short of the total market value of Bitcoin isn't anywhere near true (unless futures are excluded - and if they are excluded, what is the reason for that?).  A lot of the shorting is on OkCoin futures.

What do these statistics mean?  How many bitcoins are being shorted at OkCoin?
https://www.okcoin.com/future/market.do?symbol=0

There is no real way to know

Isn't there also a page that shows the positions of the top 20 or so okcoin future traders?  That would give you a baseline estimate.

It is quite interesting to see how the bears are still optimistic. There is already a ton of shorts open and the price isn't crashing any further, a few days ago someone even got margin-called for quite a big sum of $4 million. I think it is highly dangerous to be in the game at this point of time, especially on leverage.

If this one person was shorting 13,000 bitcoin in OkCoin - it is likely that the total amount is at least 50,000
http://www.reddit.com/r/BitcoinMarkets/comments/33eepx/okcoin_futures_largest_contract_holder_margin/

Breath of fresh air for the shorts.... https://blockchain.info/tx/97facbd7e07c4f3140d9ea167c2e54d85bc5f6fd04d9774d80b1284b706920ff

:P that guy lost around 300k from the falling bitcoin price :P shorts are going crazy as usual lol :P

How do you know that this transaction is from the guy who got his short margin called? I believe it is just some random big transaction we don't really know the source of. Sure, it could be some early adopter cashing out, but it could just be an exchange shifting around some money.

or: someone with a huge wallet moved 101 BTC.

Interesting. I only now see that the assumed amount if BTC actually transacted is at 101 BTC. I've seen this metric being off a few times with transactions of my own. Is the algorithm behind this figure known? It's always great to read all the wild theories people develop when such a big transaction occurs from time to time. :D

I bet part of the metric is the precision of the output amounts. High precision amounts have higher likelyhood of being the change output. 101 has much higher lower precision than 69,471.082201.
 
EDIT: fixed higher/lower mixup

Thats what you get when you want to scalp the BTC price. Is best to hold and let time pass for at least a month before making the next move. All these "this is how to daytrade BTC" guys seem like scammers to me. Who has done solid gains day trading BTC? im yet to see that.

With leverage you can, but it depends how much the market moves.

If your leverage trading on Bitfinex it makes more sense in holding positions longer since it's 3:1, but if your on other platforms such as Okcoin where your using 20:1 it doesn't make sense in holding positions for that long.  Very rarely you can get into a position and not worry for a bit. 

Ah yes, that makes actually a lot of sense! I unfortunately can't quite remember the transaction where blockchain.info mis-guessed the amount if was transferring. Still interesting to see what this transaction may have accomplished for the owner of the address... maybe cashing out 101 BTC? :D

Isn't it effectively suicide to play with such big sums in a market that's barely liquid enough to support those huge shorts? I mean, his stop seemed a bit poorly placed, if this rather small move has cost him that much! Can't imagine losing that much money!

Dude is either a retarded greedy bastard that is flat out stupid, making moves w/ inside knowledge or using play money.

Or not a real trading account..

Ya when you get a position that large with leverage some times even trying to help yourself would kill yourself... best to just let it go tits up I've found.

I guess so, but don't think that he's necessarily acting on inside knowledge - it's incredibly dangerous to act on inside knowledge using a leveraged position - you might hit your stops before it goes in the direction you expect. I guess it's kinda cynical to call this amount play money, but I guess that's exactly what is is for him/her :P

More people panicking once the rally gets moving.  :)
Let the Bears try to party, the fundamentals are working out strongly in favor of the Bulls.

Once this goes up and stops get hit on the way up, this is gonna be WHOOOSH!  To the moon!

We have been partying like bosses for more than 16 months now, and we won´t stop before winter starts.
I won´t even mention these few weak attempts from the (clinical dead) bulls to get something going but it would be too embarassing for the traders, the holders, the Bitcoin network, yet for the whole human mankind if all the details of this overhypesed pyramid scheme would get public.
So you should probably just look uninvolved to the ground while everyone else is laughing maniacal BTC go to single/double digits. During these turbulences you might get a chance to sneak out of your town into another country where nobody has heard about your involvement with Bitcoin.
At least the kids won´t spit @ you over there.

32,538.09 BTC :D
Shorting in da house

Just 32,538.09?

Yes, he probably moved 101 BTC to an exchange. PREPARE FOR DUMP!!! ;-)

https://i.imgur.com/04KZrsX.png (https://i.imgur.com/04KZrsX.png)

yet another ATH in BTC swaps.

I'm still flabbergasted by the amount of USD swaps, though. It's still roughly 4-5 times higher than the BTC ones.

I wouldn't be. Long swaps well below the ATH from 2014, whilst shorts are breaking new highs chasing diminishing gains.

This is all just noise until the whales going long let the elastic band go and retail shorters learn why shorting a hypervolatile commodity is a seriously stupid idea.

I'm not using Bitfinex myself but just looked at their charts. Can you go short on LTCBTC or LTCUSD or both?

Yes. Both.

But long swaps are holding stable while we're grinding lower. While during previous dumps they tended to decrease significantly towards the end of the dump.

I'm not sure how it's important, but the lower we go, the drier are bids (in dollars). So it's making me cautios.

Yep - bitcoin could crash and smash the previous low as it craters.

But if bitcoin doesn't crash and instead holds its ground then those 32000 btc need to be bought back and will probably fuel the fire that ignites us breaking the downtrend over the next few weeks/months technically. I can see a situation where bitcoin rises 100% in a single day off the back of some newsflow (probably ETF or wall street related) due to a combination of shorts closing or getting margin called as big bids start rolling in pushing the price up relentlessly.

In retrospect it will be obvious that dreaming for single and double digit bitcoins was nonsense. That the market was massively oversold, massively over shorted after a year long bear market and was due a big snap back to reality.

Miners haven't been mining at such great loss for a long time, so they hold or they short. Most of them are smart and know the market is collapsing, so they short, causing more pressure for the market to go down, causing them to have to short more, causing more pressure. See this market CAN only crash, there isn't even potential to go up.

Hedging mining supply is one thing. Destroying the market value of the commodity you produce is quite another. You don't hedge your supply by market selling 8000 coins into the orderbooks on an exchange.

There's a flaw in your logic:

Miners don't have to increase their hedging volume when price drops.

Are you guys purposefully ignorant? There is a chart intended to compare the value of swaps on this very site.

Oh of course the amount of Bitcoins required for a certain amount of value in swap lingo went up when prices went down.


I hate quoting myself but it's on page 2

https://i.imgur.com/DFYlsOk.png (https://i.imgur.com/DFYlsOk.png)

I'm still flabbergasted by the amount of USD swaps.

better, electricmucus?

yeah.
To say what this thread really is supposed be about: How overextend is the short/long side in comparison?
In context of the previous ATH that is 81.8% of the ATH for longs and 95.5% for shorts.

The other thing is the ratio between shorts/longs that is more of a indicator of "how dangerous is a short squeeze" if you look right now that's at 21.1%

I think that's still not too dangerous at the moment, given the prevailing sentiment of a prolonged bear-market. This rate could easily go up big time, still. At what point do you think the risk of a short-squeeze may become too dangerous for shorters?

Yeah, this thread (for me at least) is about: how likely is a short squeeze.

Things is: we simply don't have the data to judge this. Aggregate amount of swaps just doesn't cut it. We'd need a list of positions with price and ideally leverage used. We jcould guesstimage when positions are opened (new swaps taken) and we'd know roughly the price. We could also guesstimate when positions are being closed (swap amount decreses) and we'd know roughly the price. But we'd miss a crucial piece of info: which positions are being closed?

I wish bitfinex (or other exchanges) was radically transparent with that kind of data. Why stop at the orderbook? I'd also like to see a list of stops. No hidden orders, either. That'd resemble a fair playing field.

The way it currently is, the exchange itself (or people working for it), have an unfair advantage against the 'normal' market participants.

Running a fractional reserve scheme or disappropriating user funds seem archaic compared to taking advantage of more detailed than published orderbook status, position and user balance information. That taking advantage would work wholly undetectably and without using special powers (just by making trades through the normal user api), too.

How likely do you guys think is this kind of "insider knowledge" being used by insiders of exchanges?

I would absolutely believe it at this point :(

I think it certain. Considering we had the libor scandal from what was considered a regulated/accountable/transparent system I think insiders are going at it as fast as they can. Its not being stopped by anyone. is is also a little ironic that one of the benefits of bitcoin was that it would stop "people clipping the ticket" on the way through eg fees from credit card companies. But at least we knew what they were. Who knows how much insiders are adding to the cost of doing business. bring on the twins asap ( assuming their exchange will be blocked from doing this)   

I would not be surprised in the least to find out that this occurring.

Regarding the swap rates:  Are you guys still considering the likely possibility that the total USD swaps also include those borrowed for LTC?  It's also very interesting that even on the recent crash down to $160 there were still ~14.5MM in USD longs.  So, If it were me, I'd probably just take ~14.5MM off the current level of longs giving us ~11.3MM longs which I think is a lot more realistic.  Still outweighs the shorts by ~4MM.

I wouldn't draw the conclusion that the 14.4 M USD are LTC longs. They can still be BTC longs with low leverage. It'll be interesting to see in case we break $160 to the downside (which I'm doubtful about, but what can I say, I'm a permabull and have been wrong for 1.5 years now).

I agree, sorry, I didn't mean to imply that 14.4MM USD were LTC longs.

no harm done ;). Thanks for pointing out some of the USD swaps are likely for LTC longs. I hadn't considered that.

33k shorts again... Will be interesting to see how will bitfinex trade engine manage next short squeeze.

The fall after today's bizarre btc-e pump seems too obvious. Does that mean we'll be going back up?

What's the update?  Still ATH?

http://bfxdata.com/swaphistory/totals.php (http://bfxdata.com/swaphistory/totals.php)

Bookmark this.

Shorts down a bit, longs up a bit.

Thanks.

You're implying something very important: Exchanges know their order book, they know the hidden order, they know the stops (if traders use the exchange stops), and may use these information for their own profit and gain. Sure, it would be more transparent, but would all exchanges be willing to implement it?

Would you rather trade on an exchange that implements this or some other exchange?

Seems to me we need more competition in exchanges regarding transparency and protection against such potential exchange malfeasance.

However, it seems customers most important criteria for picking an exchange to trade on seems to be the liquidity provided and its trading volume.

Granted, it would make the exchanges less shady and more trustworthy, yeah! But a lot of people may prefer the ability to place hidden orders right in front of / behind walls. If there was only one exchange left that offered those features, they would get all the customers requesting such a feature.

I would certainly avoid an exchange that shows my stops to others. Yes, we need to make sure that exchanges don't profit on this information, but going all public is not a solution IMO.

If an exchange started doing that you could still manually initiate a buy/sell at a certain price using their API - so that information would provide some new insights, but not the full picture of how people are trading.

I could. But I wouldn't :) I'd better go anywhere else.

And how would you want to do that?

Maybe one option would be to have the exchange not offer stop orders at all. People would use bots for that, so neither the public nor the exchange knows about the stop.

To be honest: I think people decide which exchange they go to based on ease of getting fiat in/out and most importantly liquidity present on the books.

That's at least partially true. But it's more applicable to whales I guess. Small fish like me can choose more loosely. E.g I prefer o trade on BTC-e despite that liquidily is much better on BFX.
I don't know, to be honest. But how do you get rid of stops at BTC-e with MetaTrader4? I don't think it's possible.
And what about margin call levels and stop-outs? Even if you don't use stops, you can be wiped out (by an exchange too) when using leverage.

I don't know metatrader4. Assuming it's an app using btc-e api? I don't want to get rid of stops, I just want to remove the exchanges knowledge about it.

Margin call levels are harder. I have no viable idea on how to hide that info from the exchange. Lender/trader would have to manage stuff themselves, but I know of no trustless way to do that.

What are stop-outs?

That's a problem because MT4 doesn't use btc-e api. It's a separate trading platform which uses btc-e as a liquidity provider. It's mostly used for leveraged trading, so stops and margin calls are essential.

Stop-out is when your position is automatically liquidated after you fail to provide additional collateral while being margin called.

IIRC margin call level for BTC-e/MT4 is 30% while stop out is 15%.

Hope these miners have enough liquidity. Cascading margin call can make them lose money even if they are totally hedged.

So that monster spike we saw on the normal exchange was a short squeeze in the btc-e MT4 engine?

Quite the contrary. It most likely was market buying on the exchange directly, because in MT4 the peak was ~244 while on the exchange it was ~270, so it wasn't really short squeeze.
That's because MT4 has its own internal orderbook on top of BTC-e orderbook, internal is used first.

It didn't go up which doesn't mean the odds were not good that the price went up ;)

Well shorts are down to 26K, an 8K drop since the ATH on April 27th. Looks like more and more traders are starting to feel that the 17 month bear market might be coming to a close.

Should have been in bull by now if all these ASIC miners are selling at a loss.

Look at the charts. It looks like we are recovering, we might actually be in the beginning of a bull market.

So far, all the bears are fat and happy.

There will need to be some short squeeze to kill a few bears before any bull run.

Well said :D

They could just go and close their shorts, without being margin-called or their stops being hit! This is not a game of "chicken" or who can hold on to their position the longest. Many bears are actually quite smart - they don't clong to a bullish sentiment, but rather trade the market and try to make a profit, even if the price is going down. If the market changes, they change their strategy/position - it's actually not something to be ashamed of, at all!

Well, there doesn't need to be one, but it sure is helping things to get on the right track :D I think what we do need is some bears changing to bulls, though. There's no reason for them not to do that if the time for a bull-market has come!

It's more realistic to say someone is bearish or bullish than to call them a bear or bull. Few people are permanently one or the other.