Bitcoin Forum

I am far from a bear and want Bitcoin to shoot up to $100/BTC but have seen time and time again that on long holiday weekends when people cannot get deposits into their Dwolla accounts until the following Monday, the price drops throughout the long weekend, further than an average weekend.

It dropped quite a but over 4th of July weekend, Labor Day weekend and even over Columbus Day weekend.

Those were 3 day weekends.

With Thanksgiving, it will be 4 days with no deposits.

How low do you think Bitcoin will fall?

I voted $1.75 and that is my very bearish assessment, if the holiday drop history repeats itself.

But my more hopeful assessment, based on the last week and looking at MT Goxmarket depth , I see steady in-range trading in the $2.20 to 2.40 range over the holiday weekend. A much deserved stability, fingers crossed, knock on wood...

My 2 BTCs,
SJ

It's difficult to say, I think that will be decided in the next following hours.  I did choose 1.75 because that is the furthest I think it could fall now, it might not go down at all.

I'm not a bull by any means, but I wanted to vote for $2.50 (or at least "it won't drop appreciably").

Does this indicate that most Bitcoin buyers are in the States?  Granted, we are talking about USD/BTC, but is it that all of the deposits/trades from other countries combined isn't enough to keep the price from falling when US buyers can't deposit/trade?

I guess I'm just shocked that anyone is still trying to deposit money into Bitcoin. Mine for coins? Sure. Speculate for more coins? Yup. Sell off coins for money to pay bills? That too. Put money into coins as an investment? You've got steel ones, bud.

How about a "doesn't drop" option? Or drops to $2.15? I don't believe in any of the options right now.

It's a fair bit cheaper to buy right now than mine. If instead you put what you would've spent on electric for the month towards buying, you'll end up with more BTC than that month worth of mining. Plus it helps the economy!

+1

I don't think it will drop below $2 - but if it did - then it would probably go all the way down to $1.

Depends on your electricity cost, though. For instance, I get 750MHash/s from two GPUs (6950 and 5870, both slightly OC'ed) and draw 535W (Core i7 Bloomfield). That works out to around 0.57 BTC per day, for a price of $1.28 (at $2.25). I pay $0.08/kWh for power, so my power cost on that system is $1.03 per day, thus I get a profit of $0.25. Yeah, it's not a lot by any stretch, but at least it's not losing money. If my power bill was $0.10 per kWh I'd break even, and above that you're right: it's inefficient and a waste of money.

SUCKERS!

Short squeeze

Funny, seems to have dropped all the way to $2.4 at the moment :)

Gonna have to go quite a bit higher than 25 cents for a short squeeze. 

It won't.

it will

Nuh uh!

I doubt there will be a serious drop. It won't go below 2. If it does so, I will buy tons of them.

It won't, it's too predictable and people will be watching for it.  The lower the price gets, the slower the downtrend will get.  It may take another couple weeks, or even a month. 

Up this weekend.

you & me both!

What price do you need to hit to get a short squeeze? I will shed a tear for you if it gets there.

care to elaborate on what a short squeeze is?

When the price moves up, if you have a leveraged short you will get a margin call.  If you don't have enough funds to meet the margin, your position is liquidated for a maximum loss.  If that only confuses you further, google is your friend.

When you take a short position, you borrow bitcoins and sell them first then buy them back at a later date and payback your loan. So if the price goes down you make money. You have to put up some kind of capital as collateral for this loan. So if you borrow an equal amount as your capital and the price doubles, you will be forced to buy them back at double the price and lose all of your original investment. This is essentially a short squeeze. You are forced to buy the coins back at that price because if the price went any higher, your capital would no longer cover the increase in price of the bitcoins you sold.

Now the trick is that you can actually borrow on margin where you sell more than your capital could afford to buy. So assuming you used up a 5:1 margin, which is what Bitcoinica gives, you could only tolerate a 20% rise in price before your loan gets liquidated and you lose all your money.

That is in the theoretical world. It's not exactly like that because there is some margin for the loaner to profit no matter what and some margin in case the price moves too quickly.

Thanks for the great explanations!  The trend just seems to be continuing slowly up!  I wonder when our next drop off's gonna be.

I'm not short, haven't been since a week or two ago.  I'm out for the moment, market volatility is too high at 2, and margins aren't good enough for me without a substantial investment from outside my bitcoin funds.  I'm just watching for now.  My grandfather always taught me to quit while I'm ahead.   

And to elaborate on the short squeeze for the person who asked, it's not just liquidating short positions, it's a situation where a large number of shorts are liquidated and cause the price to rise, because the people who were short have to buy back the coins when they get a margin call. 

It's beginning.

I doubt it will be what the polls indicated, it will not fall below $2, it is quite stable at +/-$2.50

What is your definition of stable?

I think it's going to drop below $0 all the way down to $1000. It's science.

Looks like it. I could be persuaded to take profits now if there were sufficient market depth (I can't) but no way I gonna go long.  On the other hand if I weren't in position already I would place a tight short limit order right here. From what it seems that is what others have done.

Erm.. Up! Up! Up!.. Erm.. Down! Down! Down! Um..

http://bitcoincharts.com/charts/chart.png?width=1016&m=mtgoxUSD&k=&r=1&i=15-min&c=0&s=&e=&Prev=&Next=&v=1&cv=0&ps=0&l=0&p=0&t=S&b=B&a1=SMA&m1=10&a2=EMA&m2=20&x=1&i1=BBW&i2=&i3=&i4=&SubmitButton=Draw&

This most recent up-tick is on much lower volume.  I think there's going to be a big smack down soon.

http://bitcoincharts.com/charts/mtgoxUSD/accumulated_orderbook.png

Will the manipulator fondle us or go limp and pull out?

Let the results speak for themselves, see you on Monday :)