Bitcoin Forum

speculation?

Rocket refuelling.. /calm before the storm

Ya, with the heavy buying over (or just paused perhaps) I was a little surprised to see prices stay in a narrow band after the run from $13s (was $13.51 on Jan 1st).

The exchange volume is low so fortunately there are not many sellers "locking in" their gains otherwise there isn't much stopping a pullback of maybe 15% or so.

At a minimum I figured people whose investment in BTC is now valued proportionally greater than they are comfortable it being would have been selling here to rebalance their investment portfolio  (e.g., move some of the gains from bitcoins into cash or perhaps other assets,)  

There are a lot more bitcoins currently held by people not entirely sure this valuation will stick than there are new flows chomping at the bit to buy at $30 or more.

But who knows, the money for this rally to $30 came from nowhere so who knows if there's more to come.

The price of bitcoin is anything but stable.  We've seen the price double in two months.  We have several daily swings of 5% or more per week. 

Probably means over the last week, versus each prior week since early-January.

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

 - http://bitcoincharts.com/charts/mtgoxUSD#rg10zig12-hourzczsg2013-02-21zeg2013-02-26ztgOzm1g10zm2g25


Relative to the chart starting from early January:

https://i.imgur.com/3saShGl.png

 - http://bitcoincharts.com/charts/mtgoxUSD#rg10zigDailyzczsg2013-01-10zeg2013-02-26ztgOzm1g10zm2g25

I would be very surprised if we dont break 32 by Friday.

Because I said so! https://bitcointalk.org/index.php?topic=145904.0

But really, this is just a consolidation. Consolidation is needed so that naysayers can understand that this is not a bubble, and believe that we have a firm $30 level. After that, we move on.

For years there's been a question of how long it would be until custom chips (ASICs) would be manufactured for Bitcoin mining. Over the past several months it's looked like it would finally happen but nobody was sure if we'd really see it. Now that it's finally come and the network hash rate has begun increasing, I think this additional math power securing the blockchain is materially reducing the risk in holding bitcoins.

Yes, it may have risen recently a bit too quickly but I figure it was KimDotCom on a big buying spree before his "huge" Bitcoin tweet but when hoarders now try to figure out how much to rebalance their portfolios, I'm sure ASICs and the rising stream of positive announcements are causing them to increase the allocation that they're comfortable with.

If you think about startups, employees have NO opportunity to rebalance their portfolios before they are vested or hit their lock date. I don't know how that works on average but in the high profile pops that's been a very good thing for those who would have sold cheap.

This stability is because the bears and the bulls are both sure they are right.

No, ASICs are not helping secure the market any more than all the current CPU and GPU miners are. The only thing it secures against is an attacker with a lot of money and computational resources, but the NSA is not going to redirect their systems to attack bitcoin when they'd be losing out on SIGINT.

Stability actually fuels the rocket.

All the shaky holders sold their bitcoins around the time of the last crash. This included the people who had large crash-able stockpiles from mining before bitcoin hit the $30 mark.

Now you have people who held at $30, and everyone who started mining since then, by which time it became that much harder to acquire large sums of BTC.

Couple that with the fact that the generation of new coins has been cut to half, there simply aren't that many low hanging bitcoins on the market today.

Looking at the market depth, it looks more like everyone is unsure.

Exactly. I fully expect to see a major correction or series of corrections by the end of Q1 or during Q2 because there is no indication the equilibrium price has moved anywhere above $16-17.

What would be an indication I wonder? Staying for couple of weeks at one level? Or this is not an equilibrium, just a bubble stuck in mid-air? :D

The price looks stable because your computer froze, and the price is no longer updating? Or maybe you are on crack and since the rest of the world is spinning it makes all the recent price changes look steady? Really, I wouldn't call the price stable until it goes a couple days without going up or down by more than a percent or two.

http://qkme.me/3t5cca

totally agree! :)

looking over the graphs, I have a gut feeling the price without speculators would be around this figure of $17 -$19, because while the price is going steadily up, the transaction rate isn't.  The market isn't getting busier, especially when you take the popular IP addresses out of the equation.

On that basis, there isn't any practical reason for the sudden price rise, except for speculation.

I can agree at price $17-$19 now, but extrapolating at the end of year, I'm sure(and I will speculate) price will be above $60-70. .. So I can buy at $40 and sell after 10 months at $60 (good for me +50% in 10 months ... there is not best business in the world) ... you do not agree ? Do not buy ... if you wish sell at $20, I'll buy now :-) (profit 300%) ...but I can lose (I can change my business plan too and hold shorter/longer)...

I'm just trying to confuse you, and make some money. :-) (and I will)

Truth.

So does surprise.
If we have a "false breakout" (in either direction) with a surprise reversal, the results might be truly memorable.

Rocket has been re-fueled.

Caution from the fork scare and no new news of more adoption or investment.

Stand by.

I don't think it will be stable for more than another week or two. Looking at whats happening in Cyprus just now I think there might be a few people starting to think about moving there bank deposits somewhere the banks can't touch it. Might break up through $50 sooner than i thought.

I think we can accept that nobody knows. From my perspective it's foolish to say that the rally was pure speculation.

^This. Money inbound to Mt Gox.

And there it goes.

NAILED IT!!   ;D

love it