Bitcoin Forum

I thought this might require a thread of its own!

Shoots keep growing...

http://i40.tinypic.com/2rxfo5y.jpg

Sorry, but having checked Gox...

volume is down today on what it was yesterday, and that is without the sell off. Gox also looking like it is being traded by somebody's robots playing pass the parcel.

MatTheCat what I am doing is comparing small scale events - peaks from yesterday and today.

Have a look on the minute scale and you will see what is going on.

Of course it is always important to check the bigger picture but at the moment a lot of people are trying to work out the subtleties of the next market move, and that takes in this case also looking at details I reckon.

By the way today has only just begun - so you can't say that volume today is down on yesterday. You have to wait until tomorrow to be able to say that!  :)

Ok, looking at the past 10 days, volume is steadily decreasing on all exchanges.

Green Shoots? Really?

One explanation could be that there is a bot who puts of asks and another bot who grabs them. The selling bot seems to be programmed only to put in orders when there is low liquidity and the buy bot only acting when there is high liquidity. So the price seems to be smashed against an invisible askwall.

MatTheCat, you didn't read my last post. I am looking at microcosmic events to imagine the next market move.

Look at other threads here (Arepo's notes for example) and you will see that many think we are at a tipping point and it is difficult to call either way. At this stage I don't think 10 days ago matters so much as right now!

Of course we are... If Gox breaks $839, the next stop is likely $900-950 ($1,000 being possible) before chances of another sell-off begins.
I know many of you don't believe in Elliot Waves, but I would wager a guess that at least some of the whales do. That said, a major bearish count becomes invalidated at that price point.

Note that there are other possible bear counts, so this does not necessarily mean the bull market is back in full force.

Well, volume is down on the last 24 hours, 48 hours, 72 hours, overall.

I also notice that Huobi accounts for 50% of all Bitcoin trades at the moment. This is a Chinese exchange. There is of course the argument that most of these trades are bots playing pass the parcel and also the fact that by the end of this month, the 50% trade volume of this exchange and its other Chinese mates will be gone.

Bitcoin has been as 'stable' as i have seen it for months over the past week or so, but is it skating on thin ice and is that ice getting increasingly thinner?

Should be an interesting month, but not as interesting as February when we will see where Bitcoin really stands minus the Chinese influence.

"Thin ice" is an interesting way to put it and it certainly sounds like an appropriate description when you think of what a whale would do if it landed on an icy pond!  :(

But that description applies less well if we are not in a panicky or fearful market. And I don't think we are so much now (at least all things being as they are we are moving out of the panic phase).  :)

Right now I believe things are more stable than you think. The reason we are moving slowly is because the psychology is quite balanced. Most sellers think their Bitcoins are worth more than the current price and they are content to wait. One or two or a few think this price is fair to sell at and their walls are getting nibbled at. And it looks like we have a significant number of nibblers!

So now we have to see who will stop hodling first: those hodling Bitcoins or those hodling fiat. Remember also that for all those hodling fiat ready on an exchange, there are more waiting (could quite easily be a lot more) for their fiat to be processed by the exchange or bank so that it is available to them. And of course, there are Bitcoin hodlers with cold storage who might decide to move some of their coins onto an exchange.

For me the over-riding question at this point is a basic one. Is Bitcoin going to succeed? I think it is, and I believe that if the majority of the people I have outlined above think it is also then the market price will go up. If the majority are pure speculators who either don't understand Bitcoin properly (which could lead to a lot of fear) or who actually think it might well fail soon but want to get in on a "last wave" or whatever, then I think the price will go down.

I am a simpleton and of course there are other factors including almost chance events like convincing (but maybe wrong) news reports that could have an effect. But there we go.

The relative price stability in Bitcoin recently also calms my nerves but the increasingly thinning volume (in contrast to your thread title) does give cause for concern. With such low volume, next time a whale makes a splash could see a dramatic move in either direction, but given recent market machinations, are we more likely for a dramatic move up, or a sudden panic inducing drop? What if there are still a lot of Chinese coins being held by people who have kept an amount in reserve awaiting further clarification on the Bitcoin situation from their government, and if nothing changes, then the majority of these coins are still to be dumped?

Looking back at the April 2013 crash, Bitcoin looked like it had stabilised at around $150. Had anyone bought some BTC at these prices and held, then today they would be laughing, but anyone buying and holding back then, would have seen the value of their investment more than half. Everyone knows this and everyone wants best value for themselves, everyone also knows that China still presents a certain immeasurable X-Factor between now and the 31st January, or the next Bitcoin statement from the PBOC.

I have seen this all with gold and silver investment. I started tuning into precious metals in 2010 (first time I had surplus capital to invest in anything), jumped on-board and watched my physical 'in yer hand' bullion coins almost double in value in the case of gold, and more than double in the case of silver. I was very well versed in all the goldbug and silver stacker theories, read several books on the subject, read copious blog posts, watched hours of documentaries and you-tube 'expert' interviews. I could have hammered anyone into the ground debating the PM fundamentals, TA, loose central bank credit creation policy. In short, the meteoric rise in gold and silver all made perfect sense, and when it started to correct, it all made perfect sense that it was just stabilising preparing for the next leg up. When it went down further, out came the conspiracy theories of 'precious metal take downs'.

In short, I have been on this emotional and intellectual roller coaster before and recognise a lot of similar sights, sounds and smells, albeit condensed into a two month period as opposed to several years.

im sorry to say that you're looking at this image through green-colored glasses. if your "green shoots" carry that much significance, than shouldn't the "red slides" carry the same? in this image, there are about an even number of them. also, as many other posters have pointed out, volume really matters.

anyway, i'm just not sure about what conclusions you are drawing and what conclusions even can be drawn from this particular data.

--arepo

Well doesn't this data (the volume bars at the bottom of the image) show consistently bullish up movements, at more regular and certainly more voluminous rates than the downward red movements? Please let me know if I have misread it.

I knew those green shoots were telling me something!  :)

 :P

Your wish delivered.   Gox has broken 839.

I think he saw that  ;)

I wasn't really pointing out my call for my sake. It was more to show the merit that EW can have with determining some tipping points

I haven't got a clue what EW (Elliot Waves?) are but would be grateful for a link to a concise explanation if you have one.

Yes, Elliot Wave Theory. There is a bit of a learning curve to it, but it's not that hard once you get the basics.
I wrote up a consolidation of the basics on another forum:
https://community.bitfinex.com/showthread.php/45-Elliot-waves-to-Fibonacci

This is a more in-depth read:
http://www.forexhit.com/learn-forex/elliott-wave-principle.html

Thanks very much - I read through some of your presentation and I will do so again alongside the other one tomorrow when I have an hour or so to think about it.

Could I ask you if you have found that Bitcoin generally translates well into traditional forex analysis or is it more difficult to judge, perhaps due to factors such as "hodling" and people's expectations that it will go far, perhaps a high proportion of Bitcoin owners who are not traders, etc. What are your thoughts on this?

Certain methods work better for certain asset classes than for others. Waves and TA in Bitcoin tend to act more like commodities than stocks (wave-5 tends to be the longest from a price perspective whereas stocks have longer 3rd waves)
Bitcoin, being so new, takes time to find what works for your specific style of trading, so it can be more difficult. I do find that because there are so many "HODLers" and the lack of desire to learn TA by many here, some things that work very well in FOREX and commodities, don't work so well in Bitcoin. Others work quite well. It's' really up to you and how well you understand a method to determine if it's right for you. I do pretty well, but I'm not going to share my special sauce. :)

Thanks!

ah yes i see what you mean now. not sure if it can be said that this data alone predicted the movement we just saw but it was a good bull signal to notice. well done.

--arepo

Thanks for the clarification!

More green shoots!

As Gox goes sideways, zoom in on the minute scale.

http://i43.tinypic.com/ra1zqe.jpg

What do you see at the volume level? A nice majority of green shoots!

Why don't they make the price move upwards? Because of the ask wall on Gox.

But what they do suggest is that buying pressure is greater than selling pressure on a microcosmic scale.

Last time I called out this indicator we moved into a significant uptrend around an hour later.

I keep hearing "Green Shoots" and "microcosmic" trends.  If you want to talk about TA you may want to have a look at babypips, they have a great school for analysis http://www.babypips.com/school.  I'd recommend you have a look. 

Also I'd recommend zooming out on your charts.  1 minute charts are too narrow.  Zoom out, 15m minimum, 1 hour, 4 hour and daily.

Also, volume has decreased fairly significantly over the past couple of weeks.

And the "green shoots" are called "candlesticks".

It is something to look at only in periods of stagnant sideways movement.

It's the volume bars I'm looking at not the candlesticks.

Thanks for the link!

Green shots are back today..

Can you explain? I see what appears to be the record lowest volume day since October.

This.

Assuming there even is more volume on the upside (it's unclear), you would have to wait for an actual price movement anyways to confirm. If the volume isn't significant enough to move price, it isn't significant enough to be a reliable indicator. That makes this analysis very very close to pointless.

More significant than you think in the market today, with the positive sentiment and the record level of hodling going on.

If the market is going sideways - I mean really straight - then the minute level can give you a clue as to sentiment in this way, even if the price doesn't move.

The reason it doesn't move is because there is a sell wall. The small buys are nibbling that wall. But there are still more buys than sells. That's market sentiment.

Thinking on this level is going to become more useful as time goes on because there are going to be increasing numbers of small buyers - minnows - and together they will be a force to be reckoned with.

A couple of weeks back the market was going sideways. People were looking to the direction of the break but if I remember correctly no-one called it clearly - everyone saying it was too close to call. But I saw a significant majority of these small buys on the Gox minute scale, eating at a large wall. It looked quite clear that it was only a matter of time before this pressure had an effect. After a couple of hours the wall was gone and when the price started moving up, people piled in.

Most of the "green shoots" is being created by a bot buying around 10-19 btc every 8 minutes. Last time it was turned on it ran for weeks, I believe it was turned on yesterday.

The market is made up of human beings, machines and all sorts! Everything has to be taken into account.

A couple weeks ago all the indicators on the daily chart were still up and there was still a clear trendline intact which led to a triangle breakout.

I think it was 31 December. I don't know if that was when you were on holiday, remember?

No-one would call it either way. That was clear. I think the majority had no confidence in the trend.

Yes but at least a trend was there. Today we are hoping for this miracle recovery after the trend was just recently broken and daily MACD is down.

Yeah but be honest, you are probably a bit surprised that this particular crash down hasn't happened yet aren't you?

All I can say is that a couple of weeks back the first in a line of experts proposed two scenarios to occur within a day or two: a large crash or a sharp uptrend. He gave the latter odds of 1:100 of happening.

Just watch over the days to come. We will start going up again into a new trend after this consolidation.

Look, I can appreciate your enthusiasm, but the 1m charts give absolutely no indication of anything at all.  And over the past couple of days, and today in particular, volume (your "green shoots") is dropping in a big way. 

Exactly. 

Using the word analysis for that sub-kindergarten chart reading is way to much...

Ha ha!  :D

Bot buys 10-20 coins about every 10 minutes. That amounts to approx. 2000 coins/24 hour if its turned on all the time. So, the price will rise.

There is a whole lot of demand out there that you just can't see.

Sum the feelings of everyone in the market. 2014 is the tipping point: the move from investors feeling more secure in fiat to investors feeling more secure in Bitcoin (I'm not talking about you handful of die-hard veteran investors of course  ;)) !

Q) What is the largest BTC wallet in the whole world?

A) The DPR seized Silk Road coins wallet!


Q) What is about to happen to all those 144K coins in the very near future?

A) They are getting sold at auction no doubt a price level way below the current market rate?


Q) What will then be done with those auctioned cheap coins by those who acquire them?

A) Good fucking question but the very best that can happen, is that they are sold to investors who would otherwise represent zero buying power at the exchanges, and who decide to hoard the entire lot of them. That is the utmost 100% best that can happen and any anything that falls short of this bull's wet dream is going to be a bearish factor for Bitcoin.


Thankyou please!