Bitcoin Forum

I'm puzzled, I thought pretty much all the bears have already sold their coins, what drove the price down this time?

You don't follow 'press' board?
Two days ago, there was (again) a rumor that China is to 'ban' bitcoin (again). People panicked.

Fear!

Perfect time to buy :D

I'm a bit confused with whats going on.

It must be fairly early adopters who are selling which is driving the price down, why else wold people bail out and take a large loss if they got into bitcoin more recently.

Im keeping my fingers crossed and have been buying all the way down simply because I believe bitcoin has a future.

Because morons.

Heavy hands are at work right now.  The price is being manipulated by big pockets, but is also being influenced by the press.  
This two-fold process has resulted in decreased BTC value, in my opinion.

Too many sellers not enough buyers.
Next question?   :D

Also the IRS ruling in regards to bitcoins isnt that favorable.

BTC not will rise soon! Drop drop drop. BTC to the center of earth.

Here's a better question. Why did it rise 100$'s in the past few months? The answer to that, most people claim, is 'because China'.

Now there are 'rumours' that PBOC is going to try and close Mainland-based crypto exchanges by getting rid of their bank accounts. Rumours have circulated about this kind of action before, but officials later denied them. However, this time - no denial. It is also widely expected to be true, and is certainly believable.

'So what? Bitcoin is decentralised, that's the whole point! China can't just ban it!'
This might be true in places like Europe. But China is different, and there are a number of differences. Some are easier to quantify than others. I live in Hongkong, and work with a lot of Chinese (that is, mainland Chinese) people.
Some differences that are easy to talk about are in the exchanges and businesses based in China. The Chinese RMB is not fully convertible, you'll struggle to hedge against it and if you wanted to expose yourself to even a relatively small amount (in finance terms) you may find you simply cannot. Take a look at the usual derivatives, and see if you can expose yourself to more than a few million RMB. So having a local bank account, and being a true local company, is important in China financially, which is why the news that the powers-that-be in China closing/forbidding exchanges having bank accounts is much bigger news than it would be elsewhere. Linked to this is the long list of rules and regulations (many unwritten) associated with doing business in China. It's just not the same as it is elsewhere, you can't just get round rules so easily there. It is a hard place to do business, if the officials don't want you do business then it becomes very very hard.

Also, many of the differences are in the way people make decisions. China is much more immature than the west when it comes to trust (generally, but especially online transactions). Online shopping is rare for expensive items besides one or two large retailers. Unlike in Europe, there is much less recourse for a transaction going bad if you buy from a little known seller online. If there are no local exchanges, that will have a significant impact on how Chinese people view the currency and how willing they are to be involved with it. The internet maybe global but the Chinese internet is quite self-contained.

On the other hand, what kind of people in China want to keep assets in bitcoin? Speculators? Or people who want to hide assets? This goes back to the first line of my reply, why did it rise so much and if people are correct in claiming 'China' then who in China and why. Answer that and you will have a better understanding of why it has fallen as much as it has, why it hasn't fallen more and how much further it has to fall.

It is a very interesting post, thank you for your insight on China

There is a lot of emotion in the market and I think BTC is oversold because 480USD is only twice the price of 11months when so many businesses are accepting Bitcoin and so many are starting to save a little bit in BTC compared to a year ago but the main reason it is oversold is that the US and Europe are monetizing their date which will create massive inflation, huge losses for people saving in fiat so Bitcoin will look that much more appealing to everyone, especially when the financial sector and the whole economy will suffer from the Central bankers actions

fud from china, usa and maybe excess mtgox loot being turned into fiat

Good one!  :D But the question is: Why are there more sellers than buyers at the moment?

That and the price going down pushing the price further down bc traders play the trend and people panic sell or sell in hope to buy cheaper

China rumors + panic selling

we broke below a very important price support recently ($530). if you look at the price history in the past 5 months, the only times we fell under this level were during brief flash panics that were immediately bought back up into the $600s range (immediate post-bubble recovery, and then mtgox panic sell). price action below this support for the length of time that we've seen has gotten everybody spooked about a real bear market ahead. also, most weak hands that have already sold are looking to buy lower. HODLers are simply HODLing, and bought the bitcoins they wanted at these "cheap" prices already during the consolidation. therefore there is little buying pressure left, so we're floating downward on low volume.

--arepo

Bitcoin going down?  :(

Nice analyse but the good fundamentals are still here so we can plan on spiking up again at some point, there are probably A LOT of cash sitting in the exchanges and some cash coming to the exchanges that will buy back when they think we are going up again
It may take a while before we are resuming the bull market tough

Panicky traders who don't like a flat price, I was in that place at Christmas and made some stupid mistakes :P you get extremely impatient and start selling off and then everybody else takes advantage.

China 'bans' bitcoin every other day, what's the big deal?

It may also by the way be partly due to the American policy to tax it as property now I think of it.

Too bad I don't really have any fiat money right now, or I'd have bought more bitcoin....

Because of the FUD news, weak hands panicked.

Yes, when there is some unusual things happen or only rumors about something and lack of information make people panic about unpredictable future!

here is reason:

China Central bank new policy. forbidden commercial bank open channel for market: BTCC, Huobi,okcoin ,etc. it means we cannot have market to buy and sell btc. only by personal .
the dead line is Apl 15.
we guess the btc will drop to usd250 in china.
be careful.

I just thought about something : if the Chinese won't be able to buy BTC easily they should all go crazy and buy as much as they can with the fiat they have on exchanges and the fiat they can get to the exchanges

Chinese government is controlling the economy pretty tight so everyone's careful at what it says

bitcoin could easily go under 100 people. And in 12-24 months it could easily be over 2000. After it "popped" from 1.00 to 30 in May 2011, it spent 18 months between 5 and 15. The real mistakes are to a) be impatient, and b) feel your consternation about price somehow exerts any control over it.

It will go where it goes. The question you need to decide for yourself is how much fortitude do you have for any particular price movement in any particular asset. If you own an asset where the price movement gives you heartburn, you have not position-sized correctly.

These days I often recall that long, boring period. Who knows? When you combine another wave of fear coming from China, IRS attitude which is quite controversial, and possibility that there is a relatively small but constant selling pressure originating from epic Gox loot, situation is not very bright atm. Perhaps we are again heading into something similar and BTC might be hovering between 300-400 (give or take) for the next year or two.

That would be fine, it would give some time to build the network and innovate around the protocole

@bio : I don't mind the price fluctuation that we are seeing because I don't hold enough btc to be worried about losing wealth when the price tanks

It's actually not that many weak hands from what I've seen.

To me it looks more like some big people cashing out 1k-2k coins at a time. Surely triggering other sells on the way down. But I don't see big selling from the community at all, it's only some people realizing profits. As far as I can tell, anyhow.

I think it is pretty hard to tell

There must be a lot of traders actions and a lot of chinese selling; holders are obv not selling but when you see the price going down like that you think about selling some to buy more at a lower price of you think of cashing out a tiny bit in case when you are not a strong believer

Its goes around, so ban and un ban always does the math..

+1

This i why i this moment is good to keep btc n buy if for low prices with cash. Estimaded value on some thread are ~700$ or even more then last years 1100$.

Patience is key in this don't be hasty if price start slowly to go up w8 a bit n see.

yeah the more china bans bitcoins bullshit that comes out the more people panick and sell their coins and it drives the price down for everyone even more :(

Maybe because it was $50 last April.

Because the news has been horrible the past few months, the IRS just made using bitcoins a fiasco, and adoption momentum seems to have slowed.

Gyft's CEO made an article about short-term Bitcoin price.
It's quite insightful: https://medium.com/p/ba5f3fcce103 (https://medium.com/p/ba5f3fcce103)

Really great article, thanks for posting it.  I like the analogy of Bitcoin to the ~1993 internet, and having not yet had a "Netscape moment"

IRS kind of logical decision, China ban, mtgox but adoption seems to be going well and businesses are still getting more and more interested by the coin; maybe less in regards to the new regulation but I am not sure this new regulation is bad, Bitcoin is now legal when it wasn't even sure it was 6months ago

It is near impossible to get a business bank account in the US for any type of bitcoin business at the moment, especially for exchanges or facilitators of buying bitcoin.  Coinbase is the only real option for most people that live in the US.  This alone is really hurting adoption.  Mt Gox didnt certainly didnt help attract any new comers who may have already been somewhat skeptical.  I hope things change soon and we can start building some momentum again, but at the moment things arent going great.

The short-term trend is now up.
Medium-term coming soon.  :)

ps. Long-term is still up...

It's just a normal correction, IMO.

Why did BTC drop by $75 in the past week
At this point only down $75 would look really good.....Rally!  :)

Miners also need to continually alot of the coins they mine to make up for the investment in the asic machines they bought.

More regulations & panic selling brings down the value.

Yes, it's a very good sign it did not fell below 400$, and it actually seems stable near 430-440$
Trend reversal much? :)

Wrong. In each transaction, for every buyer there is a seller, and for every seller there is a buyer. Low prices indicates that sellers are keener to sell than buyers, choosing to sell at market than rather passively at offer.

While technically every transaction involves a seller and buyer, when the transaction price is recorded as from the bid or the ask this determines if the sale was a sell order or buy.

When there is a rush to sell btc sellers post limit orders to sell at the ask and their price to sell goes into the que. The lowest ask is the best price to buy at that market moment.

If people are selling 1000 btc at 450 and there are only a few buyers at 450 the sellers lower the ask to 449 448 etc until they find a buyer on the bid side who is willing to buy the quantity that wants to be sold.  A good example is weekend trading when liquidity is thin.  If a whale drops 500 coins to sell the price can easily drop 15 to 20 points on an exchange where the buyers are small with buy orders .1 to 3 or 4 btc on the buy side.

Obviously there is not enough buyer interest and money  now to buy more coins above the current price as there are sellers who want to sell now at this price.

Thats why the original statement is correct that there are more sellers than buyers.  If this wasnt true on a dollar to dollar basis the price would never move from the.

Well because of USA.
Still, there is hope in China unlimited amount of money.

People are selling coins in order to pay their taxes.  It will probably go up after April 15.

Why do people keep repeating the coindesk hogwash that the tax rule is unexpected or bad?  This is the exact same treatment any other foreign currency gets.  It will probably even publish an official exchange rate on December 31, 2014 along with all the other currencies.  There are no taxes if bitcoin stops changing value relative to the dollar.  Why are people complaining about having to pay the lowest possible tax rate on getting profit for doing nothing?  And if you lose money from it decreasing, then it's a tax write-off.  In terms of taxes, this is win-win-win (lowest possible tax rate, deductible, and declaration that it is same as a currency). I am astounded by the stupidity shown in this forum.  Makes me want to sell my bitcoin.

My suspicion is a slow steady dribble conversion into cash of the MtGox "lost funds".  Whoever has those would be more interested in converting to cash than long term holding. 

But maybe that's wrong.

This. Stop trying to overcomplicate things.

Its just demand vs supply.

A lot of the demand is probably "hidden" right now. People waiting for a clear bottom to get as much coin as possible for their money.
Because of this, I believe that at the first sight of a trend reversal, this hidden demand will jump on board instantly, making us return to the 600-700$ range.

Are you saying this because you currently hold a lot of BTC or are you just hoping for this to happen?

because I think the exact opposite is happening. Loads of people tired of holding are selling

Of course or else I would not be here ;)
But I'm quite sure that most people who are into Bitcoin see a great, perhaps even desilusional, future in it. Hence I do believe the true demand is higher than the supply right now.

So more buyers have to step up to stabilize the price.  Theoretically the price can go down to almost zero, 1 satoshi if no one wants it except to buy as a collectible and thats all they offer on the bid.

I wonder if there is going to be topic why it went up 75$ ;)

I'm thinking the stole gox coins are being sold like crazy. After those are gone there is no other way but up. :)

Nah, if I had stolen the gox coins I would not dump them at market at low prices. I would passively sell them over a long period. They can all be tracked anyway.

Fake news from China, stupid Australian bank and bunch of stupid people that got scared and started selling

That is a real possibility. And probably Karpeles is the one who is selling them. He is currently fighting his extradition to the US, and needs millions of USD to bribe the attorneys and the bureaucrats. Right now, he will sell at whatever price he can get.

If the assumption is true and he stole those money, he should be publicly executed.

reasons for the price dropping : mt gox, china, miners that sell, traders that follow the down trend

it could change fast and i wouldn't be surprise to see new highs this year