Bitcoin Forum

Interesting to see how big its being the bounce from the 200 day EMA (blue line):

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

For the first time since we hit $50 in mid-April, the rally from $66 has been on high volume, which is a point in favor for the "this is not a trap, but a trend reversal" case.

One point against that case is that the current rally is fueled by scarcity of coins, and not in an increased influx of money. CMF is still negative, and the fiat on Gox's order book is stagnating at less than 50% of its ATH ($11M). In the meanwhile, 10s of k's of coins disappeared from the order book:

http://www.blockchained.com/depth_mtgox_15d.png

The mother of all traps or a trend reversal? Speculate, gents.

First 10 votes, and 90% say its a trap.

Too few votes to say, but if that incredible 90% figure is confirmed that would be an indicator that we are completely oversold and we are going up... Especially if we consider that this poll is run in bitcointalk.org, which is a community bullish on BTC by definition.

Interesting.

Sample size too small. If what you said was representative of the population the runup would have stopped at a far lower price

To clarify...I'm not being bullish...I think the average guy who votes on your poll will probably know more than the average bitcoin investor...who I'm sure right now is thinking the whole bubble burst is finally over (I don't think so but am prepared to be wrong)

what meaning it has if one person will decide to dump his fresh 50k bitcoins on the market? And the rest who is buying right now will panic.

a mtgox press release does not a trend make, so there was no trend to reverse in the first place

This is true on both sides. Bitcoin is still a penny-stock market, thus is easily manipulable or "moved" by just a single entity with big pockets. If a random guy decides to "dump" his fresh $10M on the market, the rest who is not buying right now will just panic buy.

For this very reasons Bitcoin is so "fun" from a trading perspective, compared to Forex for ex. is a very wild game. As many like to say, because of how small is this market, "Bitcoin just does what the fuck he wants" :D

They've been trying. The last few days there have been several dumps. It seems the rest of the fish have developed a nice taste for whale dump now.

Don't get shaken down by manufactured "panic".

My suspicion :

https://i.imgur.com/054uqJl.png

There are a lot of arguments to disprove that as well though. We'll see next week.

If we break $105 for good picture starts to get quite bullish, at least short term. $120 could be reached easily if $105 is broken.

What does break 105 for good mean in bitcoin world where breaking a key resistance usually triggers a wave of buys that there is no time for price to settle?

if i would have such money i would take my profits now instead of waiting for somebody else to do it for me. this person who bought that $80 wall and sold now could earn around $200k in few days. There are many people who don't earn that much in a year of hard work ...

sounds like they're in the wrong suboptimal line of business :)

Good point but if there is anything any of us have learned is that there are a few players who can change this on a dime. When those $1,000,000 orders come through we are just along for the ride.
The only certain thing I've noticed recently is that who ever is doing the large buying were using the technical indicators to their advantage.

My feeling and observation is that we are still in a down trend and that this is a HUGE bounce up, a bit like that "you are here" chart above. But anything can change.

I feel like we should post less as our posts have made us "violated" by the large buyers  ;D

at this point it's probably cheaper to push the price up than it is to push it down, and i'm not referring to ask/bid depth (which moves) but directing the flow of the market psychology.

I think I can almost completely agree with that. The one thing is that we are probably really overbought now and also sitting just under the other psychological barrier ($100).
As we say, between a rock and hard place... (at least that is a bit how it feels)

Overbought as compared to when...when we were in the $60s last week, or $130s a monthish ago? All that fiat from the selling is out there somewhere....

well for starters we'd be in september on a 2011 equivalent as we peaked april

Sigh, here is the actual 2011/2013 overlay, again it takes about 2.5 times as long this time. The scaling factor is kind of arbitrary but it is definitely not 1:1.

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

why does 2013 have to follow 2011? making a proportional overlay is one thing, assuming that it's the same bubble dynamic is another fundamental leap in logic

It doesn't it is just in popular demand to compare it, and I thought I at least do it right.
e: I could probably tweak the scaling to come up with a more impressive match (scaling might be closer to 3 than 2.5) but I think everybody gets the point.

that you did

this is nice work, but it needs to be on log scale to be useful for comparison in the way I think everyone is hoping for.

You guys were saying "2012 crash" all the time, and you know there was a good chance of that happening.

I told you it's crunch time when it was about to pass 80-something and sorry you've missed it, in 2011 the previous low was defended well and the window of opportunity is over imo. As far as comparisons go anyway. This can still end up bullish but it won't be like in 2012.

how I saw 2012 was up down slow up. We can argue that 2011 was the same way. I have no reason to expect anything different this time around.

I don't think it would be slow.

true, we did get a quick snap back up.

If you think TA is BS then why you talk about candlestick patterns?

I also think is BS but I enjoying talking about it.

$105 should be a crucial point regarding a trend reversal as I wrote a few posts ago, for the reasons Vladimir exposed. This is fun to analyze and to comment. But to base all your financial decisions on TA, especially in such a small market as per BTC, its nonsense.

because the TA on this forum is generally BS

My sentiment exactly. What happened to all those profits some people made from selling above $200? They might have been playing smart and walked away from the table with their money rather than risk losing it all.

Just woke up after staying up much too late last night watching the show. I was amazed to see it hadn't changed in 6 hours or so.

So the early voters in this poll were overwhelmingly bearish? Now it seems that the bulls have a slight lead.

Interesting.

This looks like a huge dead cat bounce. I expect it to jump down on saturday

even as a bitcoin bull myself this looks like a trap to me. too much too fast and for what reason? is there some breaking news i missed?

I'm wondering this as well.  The Coinbase instant transfer option is definitely bullish news but I wouldn't think of the magnitude to bring us up this high on its own. 

here's a refreshing hypothesis: it's actual new money coming in due to 6 week old news (incubation time of new a bitcoiner (from first contact to first buy) is roughly 6 weeks)

So I looked at 6 week old news and found: "liberty reserve busted".

Hard to believe that was only 6 weeks - feels like forever ago in BTC-time. 

that is a refreshing hypotheses. i hope you are right.

There's not been a lot of movement on the bid side of God's order book. It stayed at $11M for a while.

Now look!  ;D

http://i40.tinypic.com/13ykkjl.png

The red line extends all the way to the break out at 3$.

There's more money on mtGox than is seen on the book. Newbs who buy their first coins tend to use market orders.

Is that the reason for the 30k of market buys ?  :D

It's just a hypothesis, something to think about. I brought it up to remind people that not all moves are speculative ones. All the assumptions about whales now having coins they will dump at the next opportunity might be just that: assumptions that may be wrong.

Do you know that feeling.. when the earth is vibrating a little and you hear distant rattling? Oh the anticipation... your mind drifts away painting rosy pictures of milk and honey and such. Then something tremendously powerful pulls you back to reality and the next thing you see after regaining your composure is the backside the fucking bitcoin train.

Might not be that time yet, though ;)

It is what most believe it is

whats the reason it went down so fast. None

Epic bull trap confirmation  ;)

Train is on fire, not clear whether "fucking buy" or "fucking sell" :D

Guaranteed explosion in every direction

Bitcoin drooped on June 17th because Ben Bernanke signalled he was going to reduce the Fed's monthly QE if the unemployment rate hit 7% (his statement was followed by a good jobs report and the market panicked). Gold and silver tanked too. The dollar rose.

Then yesterday he made it clear that the lifting of QE was a long way off in his opinion (and that was followed by a poor jobs report). Gold and silver rose and so did bitcoin. Dollar fell.

I think we have to conclude that some hedge funds are now dabbling in bitcoin to diversify their assets. And because they are used to liquid markets, they think nothing of dropping $2 million at a time - of course because the bitcoin market isn't that liquid, you get larger movements than you would with gold or silver.

this, my friend, makes sense.

Pump & Dump Inc.

You mean the Fed and the SIFIs?

I have no idea who is doing it. However, I suspect the Bitcoin Hivemind is engaged in cognitive dissonance.

I thought you were referencing the comment above about Bernanke's farts steering the entire global economy.

Just the financial economy.

Unfortunately, for most goods, we are stuck with the prices they set.

And back down to $90, that was quick.  ::)

Just discovered this thread and LOL'd quite a bit.

This pushed me over the edge thanks EM.

I think everything will be fine just remember don't invest more than you can afford to lose. I like molecular's idea, failing to acknowledge that in December 2012 cost me early retirement.

I'll stick with bull trap for now and hold.

You should've listened to my intution from early November '12 ;-)


Don't draw the wrong conclusions now, though. My intuition currently says it's going to be comparably boring for a couple of months. Probably best to step back a bit and enjoy summer.

Well enjoys the nice weather  ;)

It actually makes some sense that Bitcoin would be affected by Fed statements, because many BTC investors are also gold and silver investors. If your gold is going down and you need money, you might rather sell some of your more speculative investment (bitcoins) than part with your golden insurance. This is doubly true if you hold physical gold or silver, since trading physical around gets you eaten alive by the spread and fees.

Once Bernanke squeals "QE!" again, your gold is now rising so you don't worry as much about getting squeezed, so you can let your bitcoin bets ride. That means any Fed-based rise or fall in precious metals can be expected to be positively correlated with the BTC price.

Assuming gold isn't overvalued and bitcoin isn't undervalued :)

Golds been dropping like a tank though but who knows maybe a bounce is in store
But +1  :)

Let me comment about gold as I used to be quite the gold expert. Without a doubt, gold has been manipulated in the paper markets by some very big banks and hedge funds (if not countries). When Bernanke said he would raise interest rates it hit gold hard but his backing off those comments have caused a bounce in gold. Consider these prices a sale that no one knows about. They are just trying to get interest out of gold and silver due to financial problems all over the world, but it isn't working.

A few interesting points:
 
Central banks all over the world are buying up gold right now. Why? (Notice that Cypress got 400 million Euros of gold taken from them for the paper printout, I mean loan, they received.)
Even with the drop in the paper price, the demand has not diminished. This is pretty good proof of a manipulated market. Also, find out more about that at Gata.org . In many places you can't even buy gold - Asian countries are having big problems. Japan comes to mind.
China and Russia are huge importers, don't even think they export anything.

Wouldn't demand increase with falling price?

Are talking about demand in ounces or in dollars here?

so "quantity" (ounces) it is. Although demand might of course increase so much that even measured in USD it's an increase.

Agreed. Two bubbles can deflate differently, and by the following metric 2013 has already deflated proportionally more than 2011 did:

2011 Peak
Low, 10 weeks before,  $0.56
Lowest post-peak        $1.994        
Increase = 3.56x

2013 Peak
Low, 10 weeks before,  $15.39
Lowest post-peak        $50.01
Increase = 3.25x

It depends on the product and situation, doesn't it? And which came first, the falling price or falling demand? I'm talking manipulation, both physically (gold) and psychologically (trying to lower demand in gold from people.) With gold, they dropped the price in the paper markets to lower the price.

There are plenty of things that don't sell well (falling demand) so they drop the price but demand doesn't necessarily go up. When demand starts to rise, supply can go down (if demand can't be met, as with gold) and prices increase. The gold supply can't meet the gold demand right now and prices are dropping (even in an inflationary environment). (Funny thing - The Indian government has actually tried to get their people to stop buying so much gold but can't stop them while the Chinese government encourages gold purchases - go figure. Hmmm, maybe China owning so many USD's is protecting itself...)
Gold has seen a shrinking supply, increasing demand AND a drop in price for years now.

The gold price has been related to dollar strength historically (and also to the times - when things are tough, people buy precious metals). When the dollar fell in price it was due to inflation and that meant it required more dollars to buy the same amount of gold, so gold went up - basic math. That had never changed, until the US's new strong dollar policy came into effect a few decades ago (Maybe around Reagan but don't quote me on that). Starting then, the inverse relationship was halted. What the banks devised was brilliant (and very manipulative). They "leased" gold out of the central banks (at 1/2% interest rate!) to make up the difference between growing demand and shrinking supply. The problem is, that gold was essentially sold, never to come back (they used the term "lease" to get around the law). Now we see the suppression of prices continuing while countries like Germany have asked for their gold back (50% in January of this year) only to be told it will take till 2020 to get it back. This is a confirmation of sorts that the gold is not there. So, banks (maybe even China) are continuing to sell gold futures (puts) to keep the price down so they can start building up reserves. Basically the banks want to keep the price down to buy back what they have "leased" and should be in their vaults (as it is on their books as an asset).

So, with demand rising as much as it has, with inflation rising for years now, we should definitely have not seen a drop in the gold price (and silver.) I can't elaborate this as well as some and if you care to look further into it there are some people out there who really can break it down for you. Start with Gata.org. I think Max Keisser even got into this quite a few times on his show, not to mention other economists have brought it up.

I feel that the Fibonacci levels hold true here also. After a sizable runup from $66 to $104, there should be retracement. If we dip down to any of the retracement levels and keep above the last week bottom, I will start to believe we are going up next.

The following 6-12 months will likely not see new highs, the infrastructure and sentiment are both currently so damaged. But bitcoin is antifragile, and I would not sell at these levels. I bought in at exactly these kind of general feelings after the bubble pop in 2011, and have not regretted it. The following 12 months will be the opportunity for the "1%" to buy into bitcoin. They already know, based on the events of 2013.

Aren't you basically saying that the demand did go up as the price fell but that they (the bankers, etc.) pulled out all the stops to sell the gold-demanders ETFs, futures, and other substitutes to satisfy them? In other words, they got people to stop demanding gold and start demanding "gold or substitutes," so the supply effectively grew, resulting in a lower price, or lack of price rise.

That would mean that the COMEX and ETFs are stretched even thinner than they were before, which could signal a major breakdown imminent; however, who knows how far they can stretch it?

Jim Rogers, whose opinion isn't one to take lightly, thinks things will come unraveling after the summer elections. He also very recently, after many months, finally changed gold from HOLD to (timid) BUY. Here's Max Keiser and Jim Rogers, with Jim explaining this very issue of paper inflating the supply:

http://www.youtube.com/watch?v=nwhzHy7FlEw

i prefer bitcoin to gold, it's a bit lighter in me pockets  :D

close enough.

are you calling $50 the bottom based on this?

good to hear from you again, rpietila.


sssshhh. Don't tell anyone... it's obvious the trend has reversed, but we need the bears in denial so we're be able to buy into strength.

It's a bull trap, don't buy!


You bought in 2011? I thought you said something along the lines of having dismissed Bitcoin back then and regretting it.

thanks for the wrapup, Its About Sharing.

Yes and No to your question. But, it is much much darker than ETF's satisfying the public, as it doesn't. The ETF's are psychologically telling the public "Gold is losing value, is not a valuable store of wealth, etc." (So, you got that part right) And something very serious to consider, what Happens with the Winklevoss twins ETF and BTC. THE SAME THING CAN ATTEMPT TO BE DONE, but I doubt it will have the same affect, at least not for a while. It is why I hate the ETF for BTC. Why have an ETF for a digital currency??? Huh?

ETF's or selling gold puts have become a way of "controlling" the physical gold price. Most "regular people" have no idea about gold ETF's (it satisfies nothing), they just buy gold. But the hedge funds listen to what these people say and if they dump the price of gold, hedge funds add to the selling frenzy. It is quite manipulative and very very successful. It is actually like we have two gold markets, digital and physical and the digital rules. Think about that - a digital market for a physical assit sets the price. There is something very very sick about that.

There is next to NO GOLD in our vaults, it has been leased out. Again, look at Germany, they asked for 50% of their gold back and were told "2020". Can you imagine that!!!

I think I saw that video already. I trust what they (and many many others) have said regarding gold. Don't think of gold as an investment. There may come a time, not too far away, when gold will decouple with the US Dollar (as will BTC.) Runaway inflation and a collapsing currency can cause that, though the Dollar is still the world reserve and isn't crashing bad anytime soon, but it probably will.

Nice that you care about me :) Currently the doctor has promised "almost full recovery" by September. I will definitely eat my pills + live a quiet and controlled life from now on.

It is funny that people over-analyze bitcoin, even though it is still in microcap territory. Not now, but until not too many months, it will again rise with leaps and bounds, and still be so very small. The wisest people buy bitcoins now. They are cheap, and survived two bubbles. You can buy with rather big money. Everybody knows, but very few are in yet.

My regret of not buying bitcoin was in 2010. I bought first time near the post-bubble low in 2011.

Btw. Have you seen the silver that I redeemed you? :)

I concur and further encourage everyone to buy only when they consider prices to be unreasonably high. It is wise to keep doing this until we hit $10,000 per bitcoin.

Why? So you can then brag to all your friends that you bought at a time when the price was considered outrageously high.

Bragging rights = priceless.

SO why exactly is scaling time 2.5/3 to 1 'right' and all other ways 'wrong'? Because sometimes it fits the chart better? And what if it starts going, will you scale it 4-5 to 1 to make it look like the bottom of the bubble? Honestly this comparison is meaningless. THe only way it would make any sense is if instead of randomly scaling the price, use a log scale to render that random scaling irrelevant, and put a 1:1 correspondence along the time axis. Or at least try to scale the time axis in some way thats somewhat meaningful, like the difference between the time from start of bubble (hard to define) to peak.

Yes because it fits the chart better. Duh?

You are free to post any other comparison you can come up with. I haven't found another one that fits, perhaps you have more luck.
Why get people so concerned with this? For all I care it's a coincidence and the price can break the correlation any time.

Yay, rpietila is back! I'd lay off the meds and just get a ton of exercise and Sun (I'd say good food, but I know you got that covered ;)). Men weren't built for this modern indoor lifestyle, it can make one go insane all by itself. Think about it: we're designed so that when stress builds up we're usually in a fight-or-flight situation where we'll burn off the hormones that are secreted. Nowadays we just stew in them, which messes us up physically and mentally.

Trap currently closing. Pretty funny situation as there is more than a 10% divergence between Bitstamp and Gox; the inability to withdraw fiat from Gox is distorting the price and will probably extend the pain for the bulls in denial, as an impulsive move down is pretty much pointless if the fiat cannot be withdrawn by the traders.

Do you seriously think that many people withdrew money after the 10april collapse? My bet is that there is at least the same amount of fiat/btc worth of fiat in the mtgox accounts, in different hands though.

You will lose that bet big time.

I can give you two facts:

a) I personally withdrew *big time* after the april 10th collapse (at the very beginning of June to be precise).

b) the ATH fiat on Gox's order book its been +$22M. For the last month it has been fluctuating between $11M and $13M. Sure that doesn't represent ALL the fiat on Gox, but the "visible" amount is inevitable correlated with the "invisible" amount.

Most of speculators realize their fiat profits (or cut their losses) after a bubble pop. Most are in this to make money, its summer and everybody can use some profits.

My view is that the book is worth less than money sitting in the sidelines. I suppose you do not share this view?

I share it, I think the book is only a % of the total amount of money in the sidelines, something around 30% and 50% - but still I think the % is pretty consistent and can be used to have a rough idea of the money flow.

At the very beginning of 2013 there were $2M on Gox's book, and that figure was pretty much constant since Sept. 2012. From February 2013 the fiat in Gox's order book started to skyrocket, until it reached +$23M at the bubble top. IMO that represents A LOT of new money flowing to Gox, and the recent halving of the order book money represents a slow but steady declining of fiat. The book is no reliable indicator and its easily manipulable, but still it gives a rough picture that is useful to check the buying and selling pressure in certain points.

Rembember that it was possible to set orders without actually having money in the account not so long ago. Wonder how much this skewed the book.

It never was. What you're talking about is being able to set an unfunded "placeholder" order that doesn't appear in the order book until the funds arrive, and the order is either partly or fully activated.

Exactly. BTW: lucas.sev, do you trade or just comment? I'm curious.

I trade few times a month. Still very new to trading. I used bitcoin in 2011, and heard about them before (people mining them with radeons 5970) but was too young to think of them as an investment. Also, suspecting where the question comes from: I do not believe comments on this forum have ANY power over the price.

I was just surprised by the "it was possible to set orders without actually having money in the account" statement.

Those orders placed with no money never did shit, the trading platform clearly said "not enough funds" and those non-backed orders never appeared on the order book. If you were trading just a couple months ago you would have known.

I never tried placing them that's why I did not know, but I remember there was an announcement from mtgox that it is no longer to place orders when you have not enough funds.

Yep, that was a DDoS related improvement. People abused the trading engine by placing thousands of non-backed orders that flooded the system while having no practical effect on the book or the trading itself. This is why they couldn't fight DDoS just by standard means.

So far the mother of all traps is "BUY at $266".

It was "BUY at $32".

In the next year I suspect it will be "BUY at $500 to $1000".

Dude I was missing you.
A big buy happens, price shoots up 8% and here you are!

Thanks. In a way you're good for the mood. :)

Price jumped 80% now?....

Someone should be making Bitcoin seat belts to fasten themselves in for this next rocket.

i'm strapped in and ready for the ride, i won't be missing out on it

I guess it wasn't a trap. We now sitting at $130 to $140.

As of now, it looks like it was a good call  8)

Extremely good call!

maybe part of this rally actually is bitcoin being used as a substitute for LR. After all, Liberty Reserve was moving huge sums, right? That would be so funny: The FEDs saved Bitcoin ;-)

indictment said they processed 1.4B annually with 6B total over the course of the enterprise

you should take a moment to read some of it when you have a chance and note the concept of pre-approved third party exchanges

http://www.docstoc.com/docs/159108750/Indictment-Liberty-Reserve-et-al_-Kats_-Marmilev