Bitcoin Forum

EDIT: FIRST BOUNTY FILLED.

SECOND BOUNTY FILLED. DO NOT SEND MORE COINS UNTIL ANOTHER BOUNTY IS OPEN. PM me if you are interested.

It is finally complete!

The report I have been working on this past week will be my first such report that I am making available on these forums. If you are a fan of my Technical Analysis, it is in much the same style. In it, you will understand the mechanics behind the price movement since the large crash, as well as the feasible bounds for the next two months. I have outlined two likely scenarios, with targets included, so you'll know when to enter or exit, and best of all it's presented in a way that requires little to no background in TA at all! (I apologize for those of you who have more than this knowledge, as it may be simplistic but that is the tradeoff for accessibility). It features 15 annotated diagrams, explicit price targets, and tips and resources for newbies.

Since this is the first such report I am presenting in this way, I'd like to tell you a little about myself:

I have a BS in Physics with a minor in mathematics, and a BA in Linguistics. Ever since I discovered bitcoin two years ago, I have quickly applied my mathematical prowess to the task of making sense of the enormous amount of data available to bitcoin speculators. I have found that many of the 'tried and true' methods of technical analysis are somewhat weak in the way of scientific rigor, and have done my own tests to determine which methods I can demonstrate to hold water.

Since those early days, I have settled on such things as standard indicator analysis, fractal analysis (but not Elliot Waves  :P) and direct price/volume analysis. This is the basis for my report.

I recently sold some of my price targets for 1 BTC to user Wobber, which was a great success. This is really the only business I've done with forum users, but at least I have some reputation.

Here is the table of contents, to give you a sense of the layout:

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http://s24.postimg.org/6rvqxiqud/teaser.png

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I will be offering this report for a small bounty of 0.6 BTC. If you wish to receive a copy, please send a contribution to the following address, and PM me the amount you have sent as well as the email address where you would like to receive the report (pdf).

1Lget6VpCC4zGuzSykfh4YRe2mc9PQzfXT

Minimum contribution is 0.15 BTC. Please send contributions in the form 0.150000xx, and PM me your unique amount simultaneously to affirm identity.

Once the bounty reaches 0.6 BTC I will release the report to everyone who has signed up. If there is still demand thereafter, I may announce another bounty.


================


EDIT: BOUNTY STATUS: FILLED

0.63/0.6 BTC

subscribers: 4
-bitrider
-electricmucus
-iron77
-hybrid

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updated: 18:47 EST

SECOND BOUNTY STATUS: FILLED

0.85/0.8 BTC

subscribers: 4
-dandirk
-frozenlock
-michaelGedi

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*** General Disclaimer ***

Arepo's Detailed Price Analysis and Projections does not constitute, in any way, 'financial advice'. It is simply a projection of the bitcoin price according to my own notes, methods, and model.

Why don't you just make fortune trading if your analysis is really that good? Why are you selling this report?

+1

i have made my own profits, of course, but i also enjoy sharing my work with others. many other TA practitioners have paid subscriptions and I'm simply trying it out, and for the comparatively cheap price of 0.15 btc i figured some newbies might value an informed opinion. i simply do not have the time to post analysis in this much detail on the forums publicly, and publicly posting price targets has confounding effects. this report was in response to some demand from a few users, saying that they would be interested in such a product.

Good that realize that TA is pretty much total BS. I'm skeptical of your new methods too though. Bitcoin is far too small of a market for any mathematical technique to be of any use right now.

What the hell, might give it a try, I've always enjoyed your posts :)

i'm tired of hearing this over and over again. the efficient market hypothesis is contingent upon traders utilizing all past and present information contained in the price. let me give you a hint: if you're simply looking at the YTD price graph, you're missing out on a whole lot. there are demonstrable correlations that require mathematical analysis to resolve.

Thank you all for supporting my first price report!

The first bounty has been filled. If there is still demand, please speak up and I will determine the size of the next bounty.

The emails will be sent out shortly. one subscriber did not supply his address.

Me! Me!

the email has been sent. Thanks again. PM me or post here to confirm receipt.

Got it!  Thanks!

As in "I'm interested, give the next bounty."

second bounty open. this time for 0.8 BTC. if you'd like to receive the report in a timely manner, i suggest contributing a little more than the minimum. cheers :D

haha yeah, its a system i thought of to ensure that i receive a minimum X for Y subscriptions, while letting people contribute the amount that they feel comfortable with.

the bounty is increasing, but the minimum is still only 0.15 btc

only 0.25 BTC to go! two more subscribers at the most and I will send out the next email.

Nice sale technique  ;)

Now I'll sit on my hands waiting for the report.

lol i'll give it about a half hour to an hour. if the bounty isn't filled, i'll send it out and close up shop. thanks for your patience :) the first round of emails seems to have gone without a hitch, so thats good.

UPDATE

only 0.1 BTC to go! (minimum is still 0.15 BTC)

one more subscriber, and you'll get the report within minutes of your contribution! thank you all so much for showing interest in my work.

should be on it's way to you now

got it. someone contributed just before you without PMing me their identity... please do this quickly before someone claims your contribution. once they have done so, the second round of emails will be sent.

i'm not sure what i should do here.... I guess mail them out without the fourth subscriber? someone tipped me, apparently ???

wasn't me, I'll tip you afterwards if I can afford it :)


maybe send them out and keep your ear to the ground so when they do realise they need to message you their details, you can send it onwards

Last call. Emails will go out at 19:30 EST. if your name is not on this list, and you contributed to the second bounty, please PM me your amount and email address. If you do not do this by 19:30, I will not send you a report.

(everyone whose handle is on the list can expect the email at the time specified above)

only problem with that is that at this point, anyone can just look at the blockchain and claim the report. that's why the directions in the OP explicitly said to send both simultaneously. oh well...

yes that would make sense... ah well, I sent that one too then, you can send me it twice :)

they sent it already. it's visible in the blockchain. i didn't think so much security was necessary as the directions were pretty straightforward :D

seems no-one's gonna claim it, so the email will be sent out at 19:30 EST as indicated above.

The second round of emails has been sent!

Once again, thank you all for supporting me in this! I'm excited at the turnout, and I hope you find my work to your standards.

Please let me know that you received the email, and that the report is readable. Also, any suggestions for improvement are more than welcome. This report was intentionally streamlined as I was not sure how popular it would be on the forums, with an emphasis on accessibility because my main audience was newbies. If there is sufficient demand, I can put together a more comprehensive report for more technically literate traders with more emphasis on deconstruction of the indicators, one of my favorite methods, and longer-term projections.

For anyone who was left out of the loop, feel free to PM me or post in this thread, and with sufficient demand I will open another bounty.

here is a sampling of my most recent work (https://bitcointalk.org/index.php?topic=182182.msg1906065#msg1906065) for those of you unfamiliar with me.

Thanks again! And good luck trading :)

--arepo

UPDATE 1:

recent price action upgrades scenario 1 to "more or equally likely" from "less likely". the price targets in the third bullet on page 23 will apply if it resolves this way. keep an eye on the 6hr RSI -- 55 may be the 'bottom' for scenario 1 (page 22), instead of the 50-line. otherwise, if it breaks below these critical supports, scenario 2 will become more likely again.

good luck

--arepo

Thanks, I appreciate your coded update  ;D

UPDATE 2:

looks like page 18 was the prophetic one. my upgraded likelihood for scen 1 seems to have been an appropriate call too. don't worry about the volatility, that was expected -- we had to let off some steam -- we should still reach the "lesser resistance" at least.

important* update 3:

i just sent out an email about ten minutes ago. it had a chart enclosed and some updates regarding current market behavior. it's a useful extension of 'scenario 1', be sure to check it out.

also, if you didn't get the email and you subscribed to this report, let me know.

--arepo

update 4:

the price is acting more bullish than even my most bullish sub-scenario! this is exciting but worrying. corrections cannot be avoided, only carefully timed :P

keep an eye on those supports i outlined in the last email update. momentum can still theoretically correct all the way down to the second, lower line (the moving support) without indicating a reversal. remember the important resistance that is included in the price targets of the report -- this is still my best guess for the general timing of the top. i may consider revision because of recent bullish momentum, but prices above this target carry too much risk for me, personally.

happy to see scenario 1 continue to play out very straightforwardly. as always, send me some mail if you wanna chat :)

--arepo

Arepo, I hope you realize that actually selling financial advice is a crime unless you are qualified to do so, and you're exposing yourself to litigation and liability for any losses anyone makes taking your advice if you are not.

It's all good and well until you start charging.

i am relatively aware of this, and included a simple disclaimer with the original price report. is that enough to protect me? these updates have been free, and are really just conversation with the subscribers.

thanks for the heads up.

I'm not a lawyer, so I'm going to follow my own advice on that one :D Not to make any comment on how good or bad your advice may be, I was just concerned for you. Best of luck. :)

i was a little concerned for me, too, but decided to rather throw caution to the wind -- and now you've got me worried.

in the OP i gave a brief introduction, i'm just a young guy with a penchant for math and i've been working out methods for bitcoin analysis awhile. i am not 'certified' to give 'financial advice'. these are simply observations based on my trading strategies and price models, and my subscribers use it to inform their trading at their own risk. i am not liable for any losses, and i made that clear in the included disclaimer.

again: anything in the price report or in this thread that may look like financial advice, is in fact not.

if anyone is more familiar with the legality of this, please PM me privately. if you inform me well i may compensate you for your efforts.

PMed.

I can't speak for anyone else but I'm not taking it as "financial advice" in a formal sense and I don't think it's been dressed as such.

More of an informed opinion... an opinion that may be more informed than mine. It's my choice what I do with my BTC, and arepo has made that fairly clear IMO. However, my opinion could be wrong, as could arepo's analysis. I don't know what the law says about these things or the exact wording of arepo's report, but the disclaimer was in there.

Hopefully other people will see that where figures are quoted as possible hits, supports, resistance points and so on, arepo could be totally wrong. So, you would be totally wrong to follow the informed opinion to the letter. There are no exacting recommendations on when to buy or when to sell, just possible scenarios and possible best answers to each scenario that are all fairly loose and open to interpretation.

I would also add that reading analysis as an emotional investor is very helpful as it keeps things in perspective... but yeah, enough said

thanks for your subscriber-side perspective. i'm doing some research now. hopefully i won't have to make all of you confirm in a legally binding way that you won't bring a lawsuit against me   ;) :D

No worries from me either arepo...  I hate that the legal system has turned to this... Where something as risky as ANY financial advice can be sued like that.  I suppose a fine line could be made for scam vs advice, yet at the end of the day it is our BTC and us performing the action... just as if we heard a tip on the train going to work.

I would think a disclaimer would be enough, maybe an opt-out form or something.

Arepo, don't worry about making us do some additional disclaimer thing, if it saves you from douche bags that can't think for themselves and trust their life savings to you on a whim I will be more then happy to comply.  Just don't put in any small lettering demanding my first born... first that's just demented and second... not having any:)

haha it was in complete un-seriousness, don't worry :P. although i feel i will have to consult legal advice before publishing again, for those of you who expressed interest in a follow-up report.

Sorry for breaking up the party. :-\ Hopefully it's for the better.

no worries. i definitely appreciate the heads-up

in the meantime, i'm going to continue posting updates for current price action.

update 5:

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http://s8.postimg.org/s1rezhll1/fractalupdate.png

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subscribers know what i mean  ;)

update 6:

10-day 2-hourhourly scale

http://s21.postimg.org/omfx2f2hz/wiliams.png

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'moving support' here even more robust than the scaled chart i sent out in emails, showing the insane momentum of this last push. we're gonna start running out of space, soon, though. picking up some risk here.

update 6:

more trendline magic!

William's %R 10-DAY 1-HOUR scale

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http://s14.postimg.org/lvybsai2p/williamsupdate.png

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downward breakout associated with a correction to the uptrend, as projected from update 5. 50-line bounce is very bullish, and we seem to have found support at a lower line.

update 7:

*charts are 1-month 6-hour scale*

we're starting to see some panic selling. what happened to investor confidence? :D it is deepening the correction but we're still in bull territory:

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http://s17.postimg.org/3le2shb27/williamscorrection.png

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as long as that trendline holds, the picture remains bullish.

remember this?

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http://s24.postimg.org/qje2gnkhx/williams_1.png

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right now, we are still in scenario black.

if the trendline breaks, scenario red could still be bullish, but carries a lot of reversal-risk (see high-volume green 'doji' on 6-hour scale)

and at least for now, it still seems like there is too much bullish momentum and not enough selling pressure for scenario blue (REVERSAL).

trend broke yes?

my 6 hourly chart looks different to your screenshot.

Anyways I sold out before I lost my profit but seems to be stablising at 145 now. Then again, I thought that at 150!

best of luck

there's a candle battle going on right now, which affects the last data point, which is the important one. this is why my screen shot looks different, the graph changes as the data changes. nothing definitive until this 6-hour candle closes but it seems there's been some bullish action since you posted the above because we're still just stuck on that scenario black line at this moment. as long as we sit here, this is 'just a correction'. any lower and things start to look scary.. that green doji up to $166 and huge volume bar does not make me smile.

i secured some profit too, thankfully, but i'm disappointed that there was so much panic selling. i thought people really believed in this rally, but apparently it was about 40% greed, at least. we'll see in time.

update 8:

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http://s8.postimg.org/rta0eqemd/bearpennant.png

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scary bear pennant could break downwards. if it does, we may see as low as $130 but there will be incredibly strong support there. scenario RED seems most likely, with the mid-term bull trend intact. just had to shake out all the weak, greedy hands.

either way, the breakout will occur within approximately 3 hours.

--arepo

You're calling that a bear pennant? I wouldn't even qualify that as a consolidation triangle over such a short time period. That volume spike on the drop also discredits it. The bearish reversal warnings at every peak and trough since $145 are a little worrying but since it's BTC...

lucif also complains about my time-scales :D however the fractal hypothesis holds that these patterns do exist on these small scales, they are just often obscured by a lot of noise.

as such, the short time scale does make it difficult to tell if it is a robust pattern, but it fits the bill. i'll agree, however, that this is a 'weak' pennant.

if i didn't zoom in so far, the volume wouldn't look so sporadic, but the triangle detail can't be resolved at the next scale up. however, the large volume is consistent with the base of a triangle, i don't believe that this breaks the pattern. we'll see if the breakout occurs on schedule.

also, i've been attempting to determine the moving support for this rally but it is such a strange shape. by any measurement, it looks like we're way above any reasonable linear moving support so even a bounce off of $130 will not invalidate the underlying bull trend visible in the oscillators. if we touch $130 again, the $166 doji would be warranted, as we would have retraced that entire movement (hence reversal) but there's just way too much support for it to be anything but short-term. the mid-term trend prevails.

--arepo

here's another example of a robust, micro-scale (triangle-within-a-) triangle:

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http://s11.postimg.org/e56846xib/smalltriangle.png

I could write you an essay on why that's wrong: tl;dr I strongly disagree.

Go on... I'm captivated by this conversation.

i am quite curious as well -- i'd appreciate the constructive criticism of the methods i use. feel free to share here. :)

Alright. Where do I start.

Firstly, calling a series of four descending candlesticks a "triangle" is inane. They have higher "volume" in the higher price ranges than the outlying ones, which if you try to visually expand that to a longer timescale, results in high fluctuation in volume, definitively busting any bear/bull/consolidation pennant. Furthermore trying to do so simply because there was a "breakout" at the end - which seems to be the only reason you've picked a triangle to retroactively label that period - is even more inane. There are a dozen models that would be more accurate in reading that scenario than trying to shoehorn it into this model. That could be a bearish abandoned baby back at $155.5, which would mean the price was going to fall sharply after slowing. That could be another one, at the $165 peak - and in fact it is almost.

TA is an adjunct to knowledge of the market conditions. The only thing that explains (IMO) that rise is bullish sentiment. Most all of the technicals pointed to a drop.

ii'm about to respond to you, ruski, but let me put this out here first.


it's been about an hour since this call. let us consider this an experiment, or a 'test' of the fractal hypothesis. of the small-scale triangles, this 'weak' pennant is one of the more robust ones i've observed. therefore, i'm confident that we'll see a breakout. 2 hours and counting.

http://s8.postimg.org/xv4s2qwsl/smalltrianglescaled.png

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how about 21 candles? :P

in all seriousness, while i do understand the point about the validity of other pattern assessments, i don't quite follow what you mean by comparing the volume in the higher price ranges to the outlying ones. maybe you can clarify?

i think that you misunderstood my intent in 'shoehorning' the pattern into this model. as you can see, i really love triangles. :D

i think nested triangles are beautiful, and you have to admit that the 21-candle resolution shows a robust triangle shape. i don't even have to draw the lines.

coming back to your point, what's useful about candlestick analysis is that it gives directional bias: you have a 'bearish' abandoned baby or a 'bullish' engulfing shape. triangles tend not to do this. only certain specific market conditions, like consolidation after a large drop, have directional bias -- that's where the 'bearish pennant' comes from, i'm sure you know already.

keeping this in mind, my intent was more to point out a triangle than to determinate the breakout direction. it is a 'weak' pennant, but it is a robust triangle. and triangles are useful to identify even when you have no idea in which direction they will break out because the breakout is a signal. if you can determine a time frame during which the breakout must occur, when you see the sudden volume, you receive the directional signal well before the movement out of the range.

i hope this makes my above posts seem less inane :)

--arepo

I can't take it anymore.

Not to the OP personally, but damn.

If a "trading system" works, then it stands to reason that it can only be known to a few participants.  i.e If a majority "know it" then it cannot work.
Absorb other techniques and build your own.

I say this because I have traded in "front" of the market (as a Future adviser) and the locals know exactly what re-tracement/wedge/Fibonacci/macd/RSI/Stochastic/Bollinger/neural net etc.. will do at price points.   And they trade accordingly.  Push/pulling prices to these pivots is what they live for.

To the "new day traders" out there....

Take a long hard look at this chart.

http://bitcoincharts.com/charts/mtgoxUSD#igWeeklyztgCza1gWMAzm1g13zm2g25

Now look at it again and then take a "guess" where it will be in September 2013 this year.

Carry on trading and good luck.

Disclaimer:  I'm long bitcoin.
Random advice: Buy all dips.

I'm well aware of this and is the only reason i published my price report to a small number of traders. otherwise i would have done a public bounty, but you and i both know that it would be self-defeating in that case.

as for your other points, i tend to agree :)

--arepo

I really appreciate that yourself and others post trading methodologies on the forum.   

Before the Internet (and to a lesser extent today), "professionals" charge thousands for the privilege of "learning to trade".

So, it's been 3 hours, can we call it yet?


They still do. Those bastardly universities.

Those are not the courses I am talking about.

I know, just having a laugh.

looks like a beartrap breakout. a little late. we'll move up next hourly candle.

update 9:

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http://s24.postimg.org/aye0qrxxx/beartrapbreakout.png

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-triangle bounds in white
-moving support in yellow
-decreasing volume in blue
-price projection in grey

this is my best guess. if this doesn't occur, then the triangle is invalidated, indeed.

we could also simply move down. we just need the high volume to substantiate my earlier claim.

who's watching this intense candle battle? bulls vs bears, who will win? winner picks the direction of the next move....

I'm watching. That would be a nice timing for a DDOS.  :-X

I will be watching for a bit too... Though for some reason, nothing happens during this time, then when I wake up I missed something!

don't worry, something's about to happen this time.

my breakout-time-estimate was about 100% off, but i can live with that. i'm more confident now than before that this is a robust triangle -- check out the hourly candle view, very orderly. it seems i estimated the lower bound of the triangle a little too high (i thought the long tails at the base were outliers, but they were actually following a moving support that didn't get touched again until the beartrap just this past hour [yellow line in fig 9]). this is what caused me to underestimate the timescale.

figure in update 9 still my best projection. let the bulls run.

--arepo

update 10:

remember where we are in the model? this is why i believe fig 9 is correct:

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http://s21.postimg.org/5po1q0ltj/fractalupdate2.png

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so far, so consistent.

--arepo

It's just trending sideways. It could continue to do so for days. (Or external influences could attack it again, of course.) Nothing to see here IMO. Bought and holding.

https://encrypted-tbn3.gstatic.com/images?q=tbn:ANd9GcR_dyGX2EBZfkSnKjhh0H8F5yf2HbAVMA1TX9jfBtXUAUw_plmtBw

This is what happens when you confuse mid-term chart patterns for ultra short-term. ::)

haha great pic, i had a good laugh :D

as for the test, i realize that it was pretty unscientific of me to 'readjust' the breakout time after the first call -- what i ought to have done was provide error bars for the time in the first place -- which inspired me to measure triangles with more statistical rigor. geometric measurements clearly are not enough. what properties tend to lead to successful breakouts? what properties tend to lead to unsuccessful breakouts? and what properties lead to no breakouts at all, and are simply other patterns or just noise masquerading as triangles?

as for the one i was looking at last night,

http://s13.postimg.org/hcsipyg5z/breakout_fail.png

the 'breakout attempt' occurred at around 5:00 am EST, so, as i calculated before, about 100%200% error. however, it failed -- i suspect because of low volume.

however, the triangle itself is still very robust, and the price did not begin trending sideways until after 5 am. unfortunately, being able to identify triangles is useless until i learn how to measure them more precisely :P

regardless, i appreciate the constructive criticism ;) hopefully i will return with an improved model. i have some work to do.

--arepo

Stop using triangles. I would suggest using dochian channels.
For example

http://www.bitcoincharts.com/charts/chart.png?width=940&m=mtgoxUSD&SubmitButton=Draw&r=5&i=Hourly&c=0&s=&e=&Prev=&Next=&t=&b=D&a1=SMA&m1=2&a2=SMA&m2=20&x=0&i1=&i2=&i3=&i4=&v=0&cv=0&ps=0&l=0&p=0&

We have a sma crossover which can lead to a correction if the channel is moved downwards. It's pretty laggy but not as error prone.

Ok it did that, lets see if it works, if it does it should reach next support.

well i'm certainly not only using triangles :D

and yes, the crossover you identified seems to be spot on. it does seem like we're going to slide down to the next support...

Was it really triangle - it looked like a wedge (http://www.investopedia.com/terms/w/wedge.asp) for me (and I was selling).

yes, it was a wedge, that is, it did not exhibit lower highs and higher lows, but higher lows and higher highs.

since both of these patterns are associated with large volume breakouts, i tend to look at them as two manifestations of the same underlying behavior. the idea of the price function behaving like a dampened oscillator (sine function with decreasing amplitude), is associated with consolidation. forgive me for using the word 'triangle' too liberally.

I really only repeat what I read here and on some reference materials like investopedia - but my understanding is that wedge was susceptible to trend change - that is when it was going up - then it was probable that when it breaks it will go down, with triangles I don't see similar remarks on investopedia.

update 11:

*charts are 1-month 6-hour scale*


http://s12.postimg.org/6iwfj5e3x/williams.png

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this is it. this is the big moment where we test the trend's support -- if we go any lower, the picture turns bearish. the bullish momentum is gone and the selling pressure is on, we need a big bounce.

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compare to:


[from lucif's thread again]

--arepo

Well, I guess nobody wants bitcoins after all -- we're all just in it for the USD  :P

Oh I want bitcoins. But I can have moarrrr if I wait!

yes, i know you and i are not the pigs getting slaughtered right now. i just don't understand why so many people bought them if they were just gonna sell them off like this in two days' time haha. this is ridiculous panic selling right now.

Traders gonna trade.

Now I'm waiting for the inevitable rebound and re-crash.

some serious volatility going on right now...

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http://s15.postimg.org/5k3t25h8b/volatility.png

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approx. 15% in 1 min? this. is. bitcoin.

1min chart? Isn't that a little too noisy? Unless you like to trade often...  ;)

it's completely useless for analysis, i was just trying to show the volatility. i was a little late with the screen shot, it was more like 15% in 20 seconds. combination of jumpy traders, gox lag, and a thin ask side. all hail bitcoin :P

All hail Bitcoin!

It took 2 crashes, but now I understand when one should just stay put on the sideline.

I'm happy I learned.  ;D

i just realized this isn't exactly true...

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http://s7.postimg.org/wsmihm3cb/short.png

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the other reason i was looking at that scale is because i've been shorting the hell out of this panic with leverage. :D caught the top and bottom twice for about 40% returns in an hour.

the same patterns exist on all price scales...

--arepo

Interesting, where do you short BTCs? And what are the fees?

bitfinex has been good to me so far. does anyone know of any negative news associated with the service? i've been really wary with brokerages because i got burned in the bitcoinica fiasco, but there haven't been any red flags thus far.

as for fees, they're minimal. interest on positions is good too, because bitfinex has a lenders market inside of the platform, so people compete with each other for rates and they are therefore fairly priced by a market mechanism.

I'm still avoiding it. Bitcoinica was enough bucket shopping for me...

yeah, ive been profiting off of the volatility since $130 but it's not my money until i can take all of it out  :P

another (small) wave down now, but support at $120 should hold, just consolidating inside the bounds of the leg down.

again, forgive me for the small timescale (15-min) -- im swing-trading.

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http://s15.postimg.org/yp2vuk517/consolidation.png

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this is how you know an indicator is calibrated well -- perfect bounce off of the 50-line, micro-term bearish.

well, if I'd got home in time I would've done some trading on the 120 bounce... I walked in just as it was on it's way up!

Glad I sold most yesterday ~$155 !


What's this battle going on at $140 now? Anyone think it will hold?

i didn't 'get out' until things went way sour this morning. then i opened a short ;)

but im not sure what you're asking, exactly. also, from the data i'm looking at right now, this is still a critical moment, and it's going to be hard to make any projections until the price breaks out of this consolidation. that being said, we'll likely break under $140 again before any new trend appears, just in the course of consolidation.

anyone else have a hunch?

the questions right now are really: will $120 hold if we break out downwards? and if so, how long will this consolidation last before we resume the bull trend?

a break below $120 will indicate a bear market in the short-term, at least.

Down.  ;)

i think so too, but the $120 floor might just hold. that would be incredibly bullish mid-term -- we had to let off some steam but there are a lot of buyers, still.

http://s21.postimg.org/fn4uwsjnb/consolidation.png

-===-

sweet dead cat bounce, bro

Question is, do the sellers still have enough ammo left to bring the price down to ~$120 again?

I don't think there is a strict distinction between buyers and sellers. These things (also) happen because people panic, not (only) because people want to manipulate the price.

we'll see... the picture is forming. another triangle? i won't be so quick to make any bold claims, but im going to test my methods again. based on some measurements, i've come up with breakout in 90 +/- 60 minutes.

-===-

http://s10.postimg.org/5caxgr9zd/breakout.png

-===-

no claims about direction, i'm just trying to determine how precise these kinds of measurements are after last night's experiment.

--arepo

[edited for significant figures -- 90 is rounded to tens, so error must be too]

good work on the short :)

yes I thought this seemed to be a critical moment and another turning point as it consolidates.

My question was kind of related to the following: If the talk is to be believed then the drop through 140 today would perhaps be in a large part to do with manipulators (I haven't seen evidence and I wasn't watching the charts at the time but I wouldn't discount it). So, that would perhaps imply that the fairly quick bounce back to ~$140 meant that's where the true market sentiment lies as a support? This is uneducated speculation on my part, but that's why I was wondering about the current resting at around $140.

Also trying to decide on a short term re-entry point, hence asking for other opinions. But it's not a good time to decide it seems. That said I'm still feeling mildy bullish after looking at google trends, hearing gox queue and fiat news and hearing the "china overtakes US on bitcoin client downloads" news today.

time will tell.

Thanks

there are probably a few large players who attempt to 'manipulate' the market, but their actions are as useful as an eagle's wings to a hurricane. we're butterflies, they're birds of prey :P

what i mean to say is -- a single manipulator acting alone doesn't make money, it's only the 'pigs' who panic sell that make the manipulator money. that being said, Mr M didn't cause the market crash today, weak hands did.

for the short-term, if $120 holds, worst case we may enter into a period of sideways consolidation around this price point, but down seems far-fetched. the cool thing about bitcoin -- especially now -- is that the price doesn't go down unless there's serious selling, because deflation is kicking in. sideways consolidation is bullish in the bitcoin world!

if $120 doesn't hold, well, that is a scary situation. the not-cool thing about bitcoin is that most hands are weak hands (daytraders, other speculators), who are -- as was observed today -- alternately greedy, and panicky, and are always very manipulable.

oh well.

--arepo

I hope $120 will be tested soon... I like the excitement, but I would like to go to bed eventually.

Do you really think it will go lower?

breakout happened on schedule, but i don't think we're gonna make it to $120, which is short-term bullish. some consolidation to follow.


anyway -- still daytrading :D i need to go to bed soon, too, it's been a long day. but for now:

-===-

http://s21.postimg.org/jb4ju3lvr/doublebottom.png

-===-

double bottom?

--arepo

No, I want a double bottom at $120!  :D

the market intentionally minimizes your profits.

in other words, not only does it not care what you want, if it knows what you want, you won't get it :P

one word at this time: Capitulation

yeah notice the large volume:

-===-

http://s23.postimg.org/nc4n2wzh7/doublebottom_0135.png

-===-

this looks even more like a 'double bottom' than my first call. volume is comparable.

--arepo

Gna... I don't know, seems to me the first drop was to $120.
We didn't re-test it.

Something like this?

https://i.imgur.com/kBLC3PD.png

Indeed the trend is not looking good, its seems like a slow decline with bounces, i'm afraid the wall at 121-120 many not hold long.

still possible, though i assess unlikely from the following:
 
bears lose ammo with every bounce, that is, bounces on high volume are 'exhausting' to the trend.

also, the two bottoms are too symmetric. i haven't noted in this thread, but this pattern should look familiar (see action after first crash to $50). the bottoms of the bounces are almost equal, and their volumes are almost equal.

in other words -- for falsifiability -- if this bounce had significantly lower volume, or did not reach as significantly close to $120, then your model would have better chances.

try to use your bullish intuition, too -- flip the picture upside-down, does it look bearish to you? (double top)

only time will tell...

--arepo

edit: not saying we can't still go down from here, but i think the most bearish situation would be a period of consolidation around this critical resistance before another significant leg down.

first, let's ask, why the crash?

take a look at a chart i posted yesterday, the William's %R (oscillator):

-===-

http://s13.postimg.org/ioexiqyp3/overbought.png

-===-

it's clear that the market was overbought in both the mid-term (yellow) and the short-term (green). the selling pressure from being short-term overbought pushed us to the black trendline i drew -- the selling pressure from being mid-term overbought pushed us past it.

but something else apparently happened today -- can anyone confirm this?


if this is the case, then price will recover sharply as soon as the selling pressure tapers, because a huge 'unscheduled' sell-off pushes a market extremely oversold.

i suspect that new traders played an important role as well, possibly panic selling after buying into the overzealous rally (panic and greed in the same week!).

let's look at a chart? (1-month 6-hour scale)

-===-

http://s9.postimg.org/44611zvq7/chart0.png

-===-

Chaikin Money Flow no longer parabolic (good), but is linear and positive, with a positive slope. this is a bullish picture.

As for the MACD, i suspect that many new traders may have been trading on this chart exactly -- the 6-hour MACD! the panic selling started immediately after we saw a bearish crossover there.

for balance to my bullishness, 2-hour MACD shows a double-top bearish picture, with a very bearish zero-line crossover.

i hope $120 holds, for bitcoin's sake.

--arepo

Tsss, so doom and gloom.
Let us at least touch $120, will you?  ;)

But I admit that 5k @ $121 and 5k @ $120 isn't that much.
So much tension in the air! Weeeeee!

If 120 holds a week from now then I'll admit I was wrong. I have bids set to buy back in at 142.3 after selling 154 so I'm OK with this.

However if the 120 wall is breached to the 110 territory...

Anyway, this is the speculation forum after all.

i'm getting more and more suspicious of that never happening as time goes on...

i feel that we are short-term oversold, investor confidence at a local low, etc. most people went to sleep, put their bids at $90 -- hah! the market moves to minimize profits. we'll rebound before the bulk of the money gets back into the market for this reason, if we don't break under $120 soon, and the ask depth didn't exactly fill in...

all i can say is i wish your bid at $120 good luck  :D

--arepo

I want to lick 119$ and i want to lick it today. Shall we ? :D

You shouldn't explain these things arepo.. I want to see fud trolls like Jaroslaw and Nikola biting the dirt when bitcoin takes off again. :P

It will be today  ? i like watchins you loosing money :D

Too bad for you I'm only making money from the panic sell offs, and you're not getting my cheap coins because I don't sell low. :P

haha they'll think what they do no matter what i say, don't worry :P

You could make the same statement about every Sucker's Rally. Do you see any evidence that one just peaked? I have only my feeling from watching Moody that selling is the theme now.

i don't think it's quite fair to call that a 'sucker's rally' -- it wanted to happen, the market was oversold when we started out.

as for selling as the theme -- i rather have the feeling that after yesterdays volume, there aren't many more coins left to sell  ;)

--arepo

http://s10.postimg.org/pk9gckad5/bigbull.png

-===-

this is a pretty big moment for this baby bull... if we can break out of this range it'd be the first real evidence of a resumption of the uptrend -- right now we're still stuck in a bearish consolidation pennant.

edit:

further evidence for criticality: if we don't make major gains today we'll have a high-volume doji on the 3-day scale.

-===-

http://s18.postimg.org/7em7nv6kp/critical.png

Keep up the good work, I enjoy reading this thread

thanks for the feedback :)

-===-

x-post from "Arepo's easy TA":

When one says that we are "oversold", how do we observe this?

oscillators, mainly -- are you familiar with these indicators?

here's the CCI:

-===-

*10-day hourly scale*

http://s22.postimg.org/aumbd8yvl/CCI_1854.png

-===-

if you are not familiar, here are the basics, in brief:

oscillators roughly measure the 'momentum' of price. below the zero line is bearish (negative momentum), above is bullish. bounds which are calibrated to each unique formula are drawn to demonstrate periods of overbuying and overselling. notice how peaks in overbuying are often followed by market corrections, where the more severe the correction, the lower the oscillator drops? this allows for the use of trendlines to determine reversals. the last major correction before the crash found clear support on the zero-line -- a very bullish sign -- anticipating the next peak.

now for my annotations, and your question:

large blue spike says 'short-term oversold'. much red during the run-up could mean 'mid-term overbought', which is why many fear a downward correction at this point.

however, the zero-line crossover and then support during the consolidation is very bullish, as is the beak into the 'overbought' zone. (entering the overbought zone is bullish, leaving is bearish -- and vice versa for oversold).

hope this satisfies your question.

--arepo

Very helpful, thank you!

Almost completed. Brace yourselves.

*10-day hourly scale*

http://s4.postimg.org/odikscpl9/bear_RSI_2134.png

-===-

50-line bounce is a little worrying... i was anticipating more buying pressure than this.

we might see a more bearish, continued consolidation as projected in this model:

-===-

http://s8.postimg.org/azwu2tfc5/bigtriangle.png

-===-

but $120 should still hold for the short-term, at least.

--arepo

Great thread, first time reading it. 

we bounced  :D where are the buyers?

TA's gonna kill you mate. I'm waiting to see your post "I'm Arepo. Or I'm not?" :)

nothing's been invalidated... yet :P

hehe, you had so many predictions in last 24 hours you can't be wrong :)

only made two predictions in the last 24 hours:

1. $120 will hold in the mid-term
2. we will breakout up

neither one has been validated or falsified, but they both are falsifiable.

--arepo

yes, more like helpful observations and explanations for market behaviour with some possible outcomes. I do feel that most scenarios are covered, up or down, so there is no right or wrong.

I've been treating your analysis as a sort of reality check (what goes up must come down.. even a little bit), as well as a general lesson in market patterns, indicators, so on... It's more interesting observing these with a real time setting and something on the line. The most interesting thing for me is the shapes that human behaviour can cause... the visual representations of a kind of communal consciousness if you will.

I'm currently out of the "game" as I just couldn't bear (pun kind of intended) to watch the charts while I have so much work on... I'm no day trader that's for sure. I will be buying back whether the market rises or falls. Just will choose the re-entry point carefully in order to hold long, and possibly head off to Berlin for a few beers in the mean time :)

http://www.guardian.co.uk/technology/video/2013/apr/26/bitcoin-currency-moves-offline-berlin-video


Keep up the good work arepo very helpful and interesting mate

cheers :)

-===-

short-term oscillators still say 'oversold'. amazing how much buying pressure is holding the price up, with all of this selling volume -- more evidence of a bottom.

*10-day hourly scale*

http://bitcoincharts.com/charts/chart.png?width=940&m=mtgoxUSD&SubmitButton=Draw&r=10&i=Hourly&c=0&s=&e=&Prev=&Next=&t=S&b=&a1=&m1=10&a2=&m2=25&x=1&i1=RSI&i2=MFI&i3=WilliamR&i4=StochRSI&v=1&cv=0&ps=0&l=1&p=0&

-===-

$120 should hold for the weekend, and while a sustained rally is probably out of the question for the short-term, i expect consolidation around this key price point for at least that long.

--arepo

Great, thanks for the constant updates. Although i'm no expert at chart reading, i'm just beginning to learn and it always helps reading your charts.

i always appreciate the appreciation :D


they've arrived

http://s15.postimg.org/dls1k5uvv/buyers.png

--arepo

Did they bring some friends, or did they immediately die on the battlefield?

it's still the weekend, so i'm not expecting any serious action, but that counter thrust was realllly important in breaking the downward momentum we were picking up, and it will contribute to a possible high-volume doji when the hourly candle closes.

now for some accountability:


2. is clearly falsified.
see this post for details (https://bitcointalk.org/index.php?topic=183800.msg1956149#msg1956149)

my adjusted expectations given today's price action are as follows:


--arepo

short term update:

http://s8.postimg.org/p29mdsdad/triangle.png

so, we're nearing a breakout of the largest triangle, just in time for Monday! more evidence for this in the DPO and TRIX oscillators:

*all charts are 10-day hourly scale*

-===-

http://bitcoincharts.com/charts/chart.png?width=940&m=mtgoxUSD&SubmitButton=Draw&r=10&i=Hourly&c=1&s=2013-04-19&e=2013-04-29&Prev=&Next=&t=S&b=&a1=&m1=10&a2=&m2=25&x=1&i1=&i2=DPO&i3=TRIX&i4=&v=1&cv=0&ps=0&l=1&p=0&

-===-

but which way? short-term indicators suggest a bullish picture:

-===-

http://bitcoincharts.com/charts/chart.png?width=940&m=mtgoxUSD&SubmitButton=Draw&r=10&i=Hourly&c=1&s=2013-04-19&e=2013-04-29&Prev=&Next=&t=S&b=&a1=&m1=10&a2=&m2=25&x=1&i1=CMF&i2=MACD&i3=CCI&i4=UO&v=1&cv=0&ps=0&l=1&p=0&

-===-

i haven't annotated any of these, so for those unfamiliar with these indicators, feel free to ask for clarification regarding my interpretations.

--arepo

Isn't a downward triangle bearish?

yes, but not necessarily. this has been brought up many times in this thread. i really don't put much stock in the 'standard intuition' of direction based upon the shape of the triangle. it is too subjective to market conditions and is not rigorous enough. i trust directional signals from the many indicators i've tested much more.

this is also why i tried to show the triangle formations in the DPO and TRIX oscillators that are a quite different (and much more bullish) shape, because they also represent the data. price data alone can be misleading.

a brief defense of my bullish interpretation:

(1) Chaikin money flow at highs not seen since the peak at $165
(2) MACD made full recovery into positive zone for the first time since that same peak and crash, and also shows the same bullish triangle consolidation pattern.
(3) CCI and Ultimate Oscillators both show a bullish 50-line bounce during the consolidation


short answer -- yes, but the market seems bullish.

--arepo

b-b-breakout! right on schedule.

also, some not-so-rigorous musings:


we'll seee...

-arepo

Good call Arepo  ;)

thanks  ;D

it's Monday money -- i really don't understand all the bearishness around here....

that being said i'm anticipating an irresponsible and overzealous rise followed by a correction and then consolidation from there. i'm not sure we're yet ready for higher prices, but we definitely need a bullish correction to that panic selling we saw last week.

--arepo

p.s. keep an eye on the quoted text a few messages above, if we see a similar outcome it will be the second documented confirmation of the fractal hypothesis.

You called that pretty well! Yes I agree there's way too much bearishness, I still keep getting wierd bearish impulses myself even  hehehe.  Its a fine line between the bull and bear scenarios just now.

everyone ready for the next leg up? breakout in three... two... one...

Ready !  :D
That's probably a really bad sign ! Capitualtion ... what the heck ... I was just cmpletely wrong ...

BTW, what are you basing this latest prediction on ?

I heard triangles are trend continuation patterns. Trend before triangle start was up, so in the case at hand that was correct.

Which way to break, up or down? 

http://afbitcoins.files.wordpress.com/2013/04/20130429-1-month-log-chart.png

I'm saying up  ;)

alcohol and greed ;) [notice the complete lack of substance or technical defense of the claim]

i was inebriated and shouldn't have really been on the forums or daytrading at all  :D my bad.

passed out and sobered up, and what we're seeing now is a manifestation of this pattern:


im working on making fractal analysis more rigorous (specifically, more precise) because clearly we fell a little short of my target $165, but i think it's very powerful that i was able to predict the 'shape' of the price so accurately. this was to be a second test of the fractal hypothesis and i think the result can be described as: "plausible". not evidenced explicitly, yet, but i'm excited to do more work on it.


as for your question, the market seems balanced right now (indicators neutral). $120 held as anticipated and i doubt we're going to see sub-$120 coins any time soon. extending the above hypothesis, i do anticipate a consolidation period in this range ($120-$150) for about another 12 hours, at least, and then perhaps some serious price movement. unless things suddenly start looking bearish (large dump, etc), that breakout should be up, because sideways is very bullish for bitcoin at this moment.

what do you guys think?

--arepo

Sounds about right to me.

with all this talk about fractal analysis, i haven't really explained much what the methods consist of. for this reason, and for reasons of transparency and accountability, i want to make the price report which i opened this thread with publicly available, as the projections and analysis it contains have expired some time ago. for anyone who wasn't involved and is curious to see its contents, i've uploaded it in pdf format for free download*: Arepo's Detailed Price Analysis and Report [22 April 2013] (http://yrral.net/arepo-2013-04-30.pdf)

i just want to thank everyone who was involved again for supporting me in this project, and if i informed your profit, consider making a small donation to bitcoincharts, clarkmoody, and bitcoinity, as these are all services which i leverage intensely in my analysis.

--arepo

*please know that this is my own work and i do not permit profiteering off of it, only free dissemination and duplication.

I can't figure out how to download that without getting a warning about malicious downloads.  If you email it to the address in my profile I'd be happy to throw it up somewhere without needing to figure out which download link is legit and which is an ad trying to get me to download malware.

testing it myself, it seems google chrome gives the 'this file may harm your computer' warning just because it is a pdf. i admit that i used a particularly ad-infested upload site -- if anyone knows of a better site, or has a server that can host the file for me, that would be helpful.

edit: is that what you were offering? i'm emailing it to you right now.
edit2: your email address appears hidden.

--arepo

how to download this w/o having to sign up?

sorry about that... working on finding a better host right now.

--arepo

Sorry, I thought it was public, I'll pm you.  I'd be happy to put it up somewhere less sketchy.

yrral.net/arepo-2013-04-30.pdf (http://yrral.net/arepo-2013-04-30.pdf)

thanks again, notme!

fixed the link in the original.

feedback is encouraged! :)

--arepo

Thanks Arepo, all the extra insight is appreciated.

we are consolidating very bullishly, and are nearing an upwards breakout:

-===-

*10-day 1-hour scale*

http://s21.postimg.org/6f2ac7c1z/bull.png

-===-

notes:

(1) price following strong (3-pt) moving support
(2) Accumulation/Distribution confirms this trend
(3) CCI also confirms this trend
(4) Bullish midline crossover in the Stochastic RSI
(5) Bullish midline bounce in the Slow Stochastic Osc.

here's some direct price analysis:

-===-

http://s22.postimg.org/7absuy2tt/priceanalysis.png

-===-

top marked by high volume, consolidation marked by low volume, anticipating a spike in volume with the upwards breakout to confirm "trend continuation".

--arepo

Thanks for this lesson on TA Arepo. :) I will consider donating some Bitcoins to you in the future, maybe give back a slice of my earnings.

You said we would break upwards soon. Can you estimate how high we're going to go? Or is that just off limits right now?

this works, thanks!

i try to avoid posting price targets publicly, but the key levels here as we're just pulling out of a short downtrend are just the previous highs -- this is generally where we will encounter resistance:

-===-

http://s21.postimg.org/wbw0ccs7b/resistances.png

-===-

$148, $162, $166

if we get past $166 this would be very bullish and we could overshoot to around $180. however, the market is overbought in the short-term so it is likely that we bounce off of $166 and correct slightly first.

--arepo

Never seen it touch 130$ these days: do you think that will be a strong support in this short-term downtrend ?

(new here and not used to TA, but yours seems to be a pretty good job :) )

it was below 130$ 2 days ago.

Take arepo with reserve though, he's all good in drawing the lines and fancy talk but when it comes to prices he's gambling just like anyone who doesn't look at charts at all. He just put it in borders where he can always say he wasn't wrong - like it will be between 120-160.

I tend to agree with you that we are nearing a breakout. Judging by past activity, I've seen too many of these upward and steady climbs on relatively low volume, followed by a breakout to think it will be a breakdown. Now, if it had happened shortly after the fall down, and been shorter in duration, I would say it's a toss up. But, considering our normal volatility, what we are seeing with the slow climb is promising. (again, as usual)

As that guy from the bitcoin channel said, the thing that stands out is how we broke through the two high volume days, where we formed those hammer like candlestick patterns after the "crash" down. Those big red candles those first two days were on half the volume as the "hammers" were. We are basically sitting at the top of that first hammer and what appears like a support level that was formed before we exploded up.

The market, again as the bitcoin channel guy has explained, looks like it is weakening to me, if I am interpreting it correctly. The sell side is slowly creeping up and the buy side is slowly creeping down. All the while we are maintaining price. It is not a good sign but hard to interpret. Any ideas about the market?

Enjoying,
IAS

Broke out the wrong way 

Again stop using triangles dammit.

why should i? the breakout was anticipated perfectly, the direction not so much. working on an accountability report right now, trying to determine the factors that contributed to the failure of the last projection.

--arepo

I could save you some time - someone dumped 10k coins, and some others dumped 2 x 5000 earlier. People were not buying in masses in meantime.

That's it, I should patent a name for it, DUMPA20000 or something  ;D

yes, i was watching, and it was clear that the dump was a single or a few entities, not an emergent movement. there's a lot of bearish news in the air, and the market is short-term overbought. i'm trying to determine if we should expect $120 to hold, or if we're gearing up for a correction-to-the-correction of the bullish move to $165. i highly suspect these individuals were attempting to 'paint the tape', as a very bullish consolidation turned very suddenly into a very bearish picture. this event will be good to consider in another problem i'm working on, can/does price manipulation break standard methods of TA? (https://bitcointalk.org/index.php?topic=189671.0).

also, you saved me precisely no time, because while it may seem 'obvous' that your hypothetical explanation is correct, it is not rigorous enough -- only a fool should be so sure of why any particular price movement occurs.

--arepo

People were expecting new money to come with new week but that didn't happen due to holiday coming, so price dropped from initial rally from yesterday. Silk road situation probably added to that, then panic etc..

No way nobody can calculate will this or that wall stay there in such a wild market like this one is. We can only guess and pray to be lucky.

Artificially increasing the volatility will only transfer money from them to me.  There are lots of other market makers that feel the same.  In the long run, it will make no difference.

However, this is an excellent example of why no TA is perfect (I know you don't believe this yourself arepo, just picking a teaching moment for new traders).  People will do what they want despite what any sane trader would say about the chart. This is because many trade bitcoin who do not understand how to use short time frame TA properly: to make a planned trade more efficiently.  Using it speculatively is very risky when you look at short time frames.

You can try to predict the actions of the masses with some success but not the action of 1 or 2 people and that's all it takes to move things considerably in this market.

again, the basis of my argument against the perceived 'absolute power' or manipulators, or even just traders with large amounts of capital proportional to the market cap, is that the self-regulating nature of the market makes direct price manipulation proportionally expensive to its magnitude.

this being said, it shouldn't necessarily "break" the various methods of TA. for instance, it's interesting that the large move was timed perfectly with the triangle consolidation. these moves are more predictable than you think.

--arepo

I'm not talking about manipulation. Just someone with lots of coin ( that they have acquired at very low prices) that feels like cashing in a few... thousand...   and the cost is almost nothing to him.

i think i understand what you're saying -- for fear of talking at cross purposes, let me clarify what i meant:

say he picks a 'bad time' to dump -- the worst time would be at a market bottom. if he does so, there is a 'cost' of lost profits. also, if the market is 'ready to go up', a dump is just going to be picked up by smart sellers, and there would be very little effect at all.

as such, buyers and sellers don't really have a direct effect on the price, but mesh with 'market conditions' to produce the effect on the price. following from this, you don't have to predict the individual actions of large players, just anticipate the possible effects of any action on present market conditions (which are given by some methods of TA).

--arepo

The sell orders on clarkmoody are still creeping up. The buys are still creeping down. I am holding my base BTC's and sold some bought at higher levels as I don't want to take a chance should we retest the 50-70 range. I am hoping we do go back down there so I can double up what I sold off. If not, live and learn...

IAS

based on some fractal analysis, the lowest feasible bottom is around $90. i suspect that's where the support will be if we break $120.

it's amazing, but we're still 'consolidating' in huge, week-long swings from the 10 April crash:

-===-

http://s13.postimg.org/vwjvfnyjb/consolidation.png

-===-

modeling this with the classic triangle consolidation pattern, we get a similar picture, but unfortunately, it's difficult to tell what the slope of the bottom support is. if it is a flat-bottomed triangle, then $90 will be the support (yellow line); if it is a symmetrical triangle, we may see prices even lower (white line) before we reach the short-term bottom.

--arepo

You sure? I don't understand much TA but all I see is a bunch of oscillations converging around 130.

http://bitcoincharts.com/charts/chart.png?width=940&m=mtgoxUSD&SubmitButton=Draw&r=60&i=Daily&c=0&s=&e=&Prev=&Next=&t=S&b=&a1=&m1=10&a2=&m2=25&x=0&i1=&i2=&i3=&i4=&v=0&cv=0&ps=0&l=0&p=0&

PS Thanks for your posts, I find them both helpful and entertaining

appreciate the thanks :)

and yes, triangles are one of the fractal patterns found in price, so there are often triangles-within-triangles. visible on the scale you have, we do seem to be consolidating as well, and in fact we're in a smaller, flat-bottomed triangle with support at $120 and a descending top from $160. can you see it?

--arepo

I also want to thank you for your contributions. At the moment, you're one of the very few that I listen to on this forum. And I'm slowly picking up some TA understanding as well. Keep it up!

i'm happy that so many people are coming out of the woodwork like this :) it really motivates me to continue being active in this thread, even though the price report has expired.

and as always, if you profit from me, help keep it free! consider my presentation of analysis here a donation of my time and skills. feel free to tell me what you think it's worth! (address in sig).

--arepo

Well, right now I'm just holding. But if I do start trading using your advice I'll definitely share my profits if and when I see them, and I'd encourage others to do so as well. It's hard to put a number on good advice, but a percentage of my profits, no matter how big or small, is definitely worth it.

no pressure, donations are optional :P

i wish you the best of luck. :)

--arepo

arepo - I see your point with the triangles, but I don't understand how you can't take volume into play?

well after the fact, it's pretty convenient that what i called for has just played out.

but i'm not quite sure what you mean? i'm not taking volume into account?

--arepo

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Quote from: arepo on 20:01:44, 27 April 2013

you guys are fools if you think we're going to break $120 any time soon.
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 ::)

thanks for the accountability. i qualified this failed prediction a few posts ago:


notme also added his (very valuable) 2-cents:


--arepo

midterm projections still on track:


what are you guys anticipating?

--arepo

that triangle is just LOL
wow

upper line has two points of contact, lower line is pure speculation. 'LOL' isn't exactly constructive :P

--arepo

http://i43.tinypic.com/10xvzpd.png

I expect a continuation of the downward trend.

because there is nothing constructive about TA, even if you did it correctly. but you are just drawing random lines

but dont worry, you can chalk up losses to "overtrading" or "lack of discipline" like Mark Douglas and all the other failure TA traders

very good, i notice that bear pennant, too. we will break out down.

but everyone is still screaming BUBBLE and none of my data seriously suggests that we'll break below $90 in the mid-term. any other arguments for this besides that?

there are many others threads on this board dedicated to the question of whether or not methods of TA can be considered 'effective'. if you'd like to have that conversation, you can continue it there, or at least supply some kind of new argumentation besides the bald assertion that it doesn't work because it doesn't.

as i said before (i'd hate to be the tyrant who self-moderates) so discussion and presentation of TA ITT please. (assertions don't count as discussion :P)

--arepo

edit: it's hilarious how quiet this thread was as my many projections last week unfolded, but as soon as i get one thing wrong, the TA-naysayers are back :D

There is a method to the madness however. Because everyone - whether they would like to believe it or not - when they look at a chart, see patterns and associate something with them based on some prior experience, etc. As a consequence, the pattern comes to fruition, and the people that saw the pattern and decided to hold/sell/buy wrote their own future. TA, at least in my opinion, to a certain extent comes down to math and the psychological aspect of trying to figure out what everyone else is thinking about before they know it themselves.

good point -- as i like to say, if there are methods that work, they can be considered functional analysis. if there aren't, why is everyone here wasting their time with a cointoss? there's satoshidice for that :P

i think the bear market is rustling all the newbies' jimmies ;)

*10-day hourly scale*

http://bitcoincharts.com/charts/chart.png?width=940&m=mtgoxUSD&SubmitButton=Draw&r=10&i=Hourly&c=0&s=&e=&Prev=&Next=&t=S&b=&a1=&m1=10&a2=&m2=25&x=1&i1=CCI&i2=&i3=&i4=&v=1&cv=0&ps=0&l=1&p=0&

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looking awfully oversold on the short-term scale. the downward momentum has been exhausted. i expect a downwards breakout from the pennant evolve outlined, but we won't break under the $100 support.

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-===-

instead, the oversold signal confirms some fractal analysis that suggests we'll retest but bounce significantly into a larger bearish pennant, peaking and then breaking downwards again to test the $100 support in the next 48 hours.

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http://s3.postimg.org/ouzptactv/bounce.png

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will $100 hold then is not yet clear.

--arepo

this would make sense, if two things were true:

1. the majority of the trading volume was made up from people using TA
2. the TA that they used were all the same

i reckon that neither of those two are true. 1. is pretty straightforward. most of the volume in the markets is pure speculation and/or silkroad, not from people looking at charts and making disciplined trades. 2. is blatantly not true, as you can easily open up any two TA threads in this forum and find hacked up charts with wildly differing lines drawn at the most random places

it is a good thought though, and definitely the correct line of thinking. but even if it were true as you said, and even if those 2 points above were present, then the prediction and trade would be working because everyone is taking action in the same direction, and hence moving the market. it would be the same as calling everyone up and saying, "ok we all buy at $100." the trade would not be working because of some magical TA strategy that works when X indicator crosses Y indicator or because Z line of support or because of ABC head and shoulders and cock and balls pattern.

I didn't outline any pennants, but it looks good so far with the bounce to $118.

sorry about that, i must have just read a post of yours when i was writing that. :P at least i didn't name electric -- he hates triangles hah

edited in the original

--

i always find it fascinating how many layers of self-similarity there are in the price function. this is the third 'public test' of fractal analysis, which i'm a little suspicious of because it is lacking in rigor in that it is just as prone to apophenia as elliot waves. i've been outlining a number of shapes that i can define in rigorous terms, and once that list is complete i intend to do statistical analysis on price history data to hone the method's precision.

until then i've been focussing on the 'bubble shape', a type of bearish reversal that occurs across varying scales in many bullruns in bitcoin price history. i've identified three versions of this pattern in price data since just April 1, and used their shape with great success in anticipating price movements in similar market conditions. it's just an amazing idea that the larger shape of price can mimic smaller structures that have already formed within its history, exactly like a mandelbrot set!

since the 'fractal hypothesis' is still in its infancy, i encourage feedback from the sharper minds of the community :) i've learned so much from other posters here, that i've come to see it as a community of very intelligent people, and an excellent collaborative atmosphere for new ideas,

--arepo

keeping it short, but hopefully clear:

the effects of 'insider trading' suggest that price-relevant information is not factored into the price in an ideal way, but the Efficient Market Hypothesis suggests that most relevant information is 'encoded into' or somehow represented in price -- this information including market sentiment, greed/fear, risk-aversiveness of other players, and the like.

this leads to the idea that profitable information asymmetries between players can form for short periods of time.

from a mathematical point of view, it has been shown (see the Hurst exponent) that autocorrelations exist in price data -- that is, regularities which can be profitably anticipated.

as such, in a simple way, technical analysis is an analysis done on price data to find patterns -- essentially, identifying how the price is deviating from its natural stochastic (random) nature.

and this demonstrably occurs! trend-following is very successful in certain market conditions (see goomboo's journal). this leads to the idea of 'momentum', that it is statistically unlikely for the price to suddenly violate a trend. another simple strategy is measuring the 'rate of change' of price, because 'momentum changes before price changes' follows from basic rules of derivatives in calculus.

i hope i have showed you how it is possible to get at information that may be 'coded' into the price, that others do not have access to, that creates a profitable information asymmetry between players.

--arepo

i have no idea what that block of rambling is suppose to prove, other than to convince yourself that your methods have validity. it was not clear at all what point you were trying to make, and it was irrelevant to the disucssion:

my post was in response to the post claiming that TA works because it is a self fulfilling prophecy. while the premise is sound, in practice, most don't do TA, and those who do, don't do TA exactly the same, so it cannot self-fulfill.

anyway


you have not shown that. i have reread your post a few times trying to figure out what your point is in case i'm missing something, but it seems like you are just throwing together random stuff together to try to support your claim.

reminds me of this quote which is wayyyyyy ironic

"The trend is evident to a man who has an open mind and reasonably clear sight, for it is never wise for a speculator to fit his facts to his theories."
-Jesse Livermore - Reminiscences of a Stock Operator

Maybe try looking up some of the terminology you don't understand.  It's pretty clear to me.

i understand all of the terminology. i dont understand what point he is trying to make.

at one point he claims that prices are random and that is their nature, which is a joke of a claim. then he claims that he can find "coded" information in previous prices. confusingly, he also used similar terms when trying to spout the EMH, which is contradictory

get off the bandwagon, and on your bike

but if its clear to you, please feel free to clarify his point for us all so we can have a real discussion

I'm not on a bandwagon, just tired of people coming to an analysis thread to complain about analysis  Never take any advice in these forums without a few pounds of salt.

not here to complain, just saw some posts in the other thread so decided to check out what was going on in here. i made one comment "LOL" and he asked me to stop, so i did. then i responded to another guy who came to a legitimate conclusion, but was just not practical

btw i made an edit to the previous post, inviting you to start a real discussion if you understand his point. perhaps you can clarify for us


indeed

i'm sorry if it was dense. and i realize now i didn't exactly connect it to what i quoted. let me try to summarize more clearly:

"""TA can work even if the two conditions you noted are not met. i propose the following:

a trader using the methods of TA attempts to extract more information from the available price data than others who are not looking for regularities (not doing any analysis).

this creates a difference in the information available to each 'player'. this is profitable for the same reason 'insider trading' is profitable."""

i hope i was able to communicate my meaning this time.

yes sell your coins today and double them tomorrow. ( no way in hell... )

then buy a really big boat!  :D

fair enough, and i would agree. my two points were only in regard to TA working as a self-fulfilling prophecy, which is what the other guy inferred with his post. if you are coming from the premise that TA is not a self-fulfilling prophecy, but rather a legitimate system of determining probable future prices, then my two points are irrelevant. my post was in response to his.

but whether it is a legitimate system is questionable (whether or not you can actually extract information that is useful in the same way as inside info is useful)

i actually appreciate this kind of discussion, johnblaze made a good point, and showed he had thought about it critically. it just bothers me when someone comes out of the woodwork and posts a dismissive comment with no constructive criticism at all :D

i'd love to hear what arepo thinks about this.

under 50 ever again? what are the odds Mr Spock

if you're looking for "never again", Mister Supernode is your man, he has one "never again" weekly ;D

yes, i kind of stitched together bullet points of a sort of thesis i'm trying to develop. i apologize for the disorganization.

let me try to build a bridge between the ideas you just mentioned:

the emphasis on information is because trading is a limited information game. this is separate from the price function, which is stochastic, essentially random, which is exactly why no methods of technical analysis can produce 100% confidence.

take the 'weekend dip'. once a thread about it was posted and trafficked to saturation, the effect stopped happening. why? because traders selling early friday and buying back in sunday, profited off of this information asymmetry, anticipating that others were going to sell and undercutting them.

these regularities have been shown to exist, and i do believe they violate the strong form of the EMH, which would imply that a good is at its 'true price' at all times in the marketplace. in practice this falls quite short of ideal. remember how the price doubled suddenly after a long period of consolidation a few months before the block reward halving? the suddenness of the onset of the price discovery phase suggests that the way that price-relevant information is factored into the price is far from ideal, and if you have meta-information -- information of another players' future actions -- you can undercut them profitably.

i'd hate to be a talking head, but i'll put in my two cents if you insist. :P

imho, determining the odds of the price being at a certain point "ever again" is pretty futile. i liked ichthyos model of a gaussian curve for a model of the probability of 'ever' reaching a price point 's' standard deviations away from the present price, or the mean historical price. in this model, the probability of a price point s deviations away approaches zero as s -- > infinity, but is nonzero for all such points.

for time-scales:

short-term: unlikely
mid-term (this year): possible
long-term: see above

cool thanks, some quick thoughts before i go to bed


yes information is limited. if you assume the market is efficient, then you dont care if its limited because all information is reflected in price anyway. bitcoin is not that market


you are making assumptions that are not necessarily true.

1. that the 'weekend dip' was in fact a real pattern that would have been repeated whether or not new traders learned about it. this is definitely questionable. sure you can point to the fact that banks are closed on weekends and therefore no new money on gox. but that is more fundamental than technical

2. that the reason that the 'weekend dip' stopped was because of new traders learning about it. if this was true, then the dip should just continue moving up earlier in the week. everyone sells friday in anticipation of the weekend dip, now becomes a friday dip. then ppl try to frontrun again, it becomes a thursday dip. etc


well the EMH is just a hypothesis. you need to decide just how efficient each market is. the S&P500 is about as efficient as they come. its unlikely that you can convince me that TA will work on that market. Bitcoins? way inefficient. thats because its still in growth stage. inside information isnt as important as new projects and wider exposure. that is pretty much what will determine the price. western union makes announcement? price spikes. silk road goes down? price falls.


this is definitely all true. bitcoin is endlessly in price discovery mode and will continue for a long time. it will be a rollercoaster. if you have info that western union will start at X date, you will be undercutting every seller who sells prior.

overall i agree with your post. but my contention has been whether or not you will actually find usable, valid information from which you can profit from, merely by looking at charts of past prices and drawing lines and BIGMACd indicators and looking for shape of erections developing. i exaggerate for humor, but nonetheless the point remains. and in this post of yours, you dont really talk about charting techniques which is probably why i am not in disagreement

and i'm not just some random who is trying to troll all the chartists. i have read many books on TA and devoted a lot of time in the futures markets. i really wanted TA to work. however, nothing ever passed the common sense test. (talking about discretionary trading only here, obviously if you backtest huge data and have statistical evidence, then sure, but in that case, you aren't trading technically, you are trading statistically). Market Profile stuff made sense, but it seemed to apply more to efficient markets like the big indexes

i'm glad we're mostly in agreement :)

you're right of course, all this is fine and dandy but i've got to show that the specific methods of technical analysis are effective at 'uncovering' these patterns. i find that standard indicators like the MACD do indicate simple trends well, as i mentioned earlier, and the properties of price momentum are really effectively displayed by oscillators.

not only do real-world things like closed banks cause regularities, but patterns in human behavior as well. the convenient thing is, we don't have to hypothesize about social psychology -- we just have to rigorously show a pattern in the data.

for the trend-following example, we tend to overreact, and push the price into 'overbought' and 'oversold' states (these are metaphors, admittedly, but give a decent understanding of what the oscillators represent). recognizing that we are in these unstable states helps you anticipate price movement, given other market conditions. i'm reminded of a striking example of this during the rally to $160:

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