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Title: Previous crashes and recoveries Post by: Joe200 on July 03, 2014, 04:09:11 PM (This is the latest, posted 2014-11-20. Original here (https://bitcointalk.org/index.php?topic=676333.msg9604683#msg9604683).)
The list. Here is a list of all the price drops of 15% or more. Code: pk.date pk.dow pk.moon pk.price tr.date tr.moon tr.price drop ft.date ft.moon ft.price n.dest n.be n.tr.pk n.ft.pk * Number = peak was higher than all previous peaks. Letter = peak was lower than a previous peak. * 8 drops from a peak that was higher than all previous peaks. 3 drops from lower peaks. * pk = peak. tr = trough. ft = "foot" -- according to my simplistic algorithm, this is when the next move up begins. (For the latest crash, these are provisional.) * xx.moon = the distance, in days, from the new moon. Either the previous new moon or the next new moon, whichever is closest. * drop = percent drop from peak to trough. * n.dest = number of days of gains (prior to the peak) that were destroyed in the crash. * n.be = number of days to break even if you bought at the peak. * n.tr.pk = number of days from the current trough to the peak which preceded it. * n.ft.pk = number of days from the current foot to the peak which preceded it. A drop of 15% is not really a crash. Here are all drops of 45% or more, which is what I would consider to be a crash. Code: pk.date pk.dow pk.moon pk.price tr.date tr.moon tr.price drop ft.date ft.moon ft.price n.dest n.be n.tr.pk n.ft.pk * Only 4 crashes so far. Crash duration. * In the current crash, it has been 355 days since the peak. So far, this is the second longest crash to break even. The only longer crash was off of 2011-06-09, which took 617 days to break even. If it takes as long to break even in the current crash, then it will take until 2015-08-09 to get back to 1,130. * In the current crash, the trough so far is 2014-11-02 / 324. There've been 337 days from peak to this trough. This is by far the longest ever. * Similarly with the foot -- 343 days from the peak, longest ever. What does this all mean? History. * 2014-05-15 (https://bitcointalk.org/index.php?topic=610189.0) * 2014-07-03 (https://bitcointalk.org/index.php?topic=676333.msg9604683#msg9604683) Peaks and troughs are not equivalent. I detect peaks as the highest price before a drop of X%. The troughs are the lowest price before the next peak. The above shows peaks and troughs in the price of BTC/USD. For another perspective, let's look at the price of USD/BTC. For convenience, I convert it back to the BTC/USD scale. All drops in the price of USD in terms of BTC of 15% or more. Code: pk.date pk.dow pk.price tr.date tr.price drop ft.date ft.price n.dest n.be n.tr.pk n.ft.pk * Peak is the peak USD price, which is a BTC low. * 10 USD price drops in all (BTC price rises). * 3-6: 4 lower peaks, followed by a huge USD drop. Peaks 7-10: we've just had another 4 lower peaks. * 2, 6: Trough higher than previous trough. The following peak is higher than previous peak. 10: trough is again higher than the previous trough. Will the next peak (BTC low) be higher than 324? * Two big bull markets (in BTC): 0.05 to 29.6: 318 days. 2.14 to 1,130: 741 days. Does anything look interesting to you? Title: Re: The next crash Post by: matt608 on July 03, 2014, 05:09:32 PM Nice predictions, I roughly agree with you though I'm not sure it will take quite so long (until January) to reach the peak, though it might, depending when the ETFs launch. But what about the Willy report? Do you not place any importance on that? I thought that might make this next predicted 'bubble phase' a bit smaller in proportion to the previous ones, but then again the longer time it takes to reach the next bubble the bigger it will be, so that would cancel the negative willies out.
Title: Re: The next crash Post by: InwardContour on July 04, 2014, 12:21:59 AM It is very important to note that bitcoin being invested in by VC has very much changed the dynamic of the trading market. As less percentage of investors are speculating on the price the price of bitcoin should become more stable and the frequency of "bubbles" and crashes should decrease.
Title: Re: The next crash Post by: yayayo on July 04, 2014, 07:58:37 PM You've compiled interesting facts on previous peaks and crashes which is nice. But I don't think they can be considered good predictions on future peaks/crashes. One thing is that the history you use is quite short which is due to the fact that bitcoin is still young. On the other hand - what makes you think, that bitcoin will behave similar in the future at all?
If you can back your assumptions with solid fundamentals they would definitely gain in value. ya.ya.yo! Title: Re: The next crash Post by: InwardContour on July 05, 2014, 03:04:05 AM Nice predictions, I roughly agree with you though I'm not sure it will take quite so long (until January) to reach the peak, though it might, depending when the ETFs launch. But what about the Willy report? Do you not place any importance on that? I thought that might make this next predicted 'bubble phase' a bit smaller in proportion to the previous ones, but then again the longer time it takes to reach the next bubble the bigger it will be, so that would cancel the negative willies out. If the ETFs are needed for the next growth spurt a peak in January is early I would say. I don't think it will take this long but it might. Title: Re: The next crash Post by: CoinsCoinsEverywhere on July 05, 2014, 06:20:46 AM Nice predictions, I roughly agree with you though I'm not sure it will take quite so long (until January) to reach the peak, though it might, depending when the ETFs launch. But what about the Willy report? Do you not place any importance on that? I thought that might make this next predicted 'bubble phase' a bit smaller in proportion to the previous ones, but then again the longer time it takes to reach the next bubble the bigger it will be, so that would cancel the negative willies out. If the ETFs are needed for the next growth spurt a peak in January is early I would say. I don't think it will take this long but it might. I agree, and I think we may need an ETF to get the influx of money needed to reach all-time highs again. All the ATMs that are coming online around the world may also add an unpredictable amount of fuel to the fire if/when bitcoin really rallies again. Title: Re: The next crash Post by: CoinsCoinsEverywhere on July 05, 2014, 06:23:58 AM To the OP: this is some really interesting stuff. Thanks for posting it.
One question though: what would it take to invalidate your analysis? In other words, what price would bitcoin have to drop below for you to reconsider your predictions? Title: Re: The next crash Post by: BTCfan1 on July 05, 2014, 07:33:24 AM I know I am gonna refer back to this when/if we get to that price level, thanks op!
Title: Re: The next crash Post by: blatchcorn on July 05, 2014, 07:44:19 AM I love non-technical analyses - great work
Title: Re: The next crash Post by: phatsphere on July 05, 2014, 08:53:44 AM about the dates, what did you do for the "truncated distributions"? for me, it looks like the peaks become more often over time.
Title: Re: The next crash Post by: transient858 on July 05, 2014, 03:27:10 PM Nice predictions, I roughly agree with you though I'm not sure it will take quite so long (until January) to reach the peak, though it might, depending when the ETFs launch. But what about the Willy report? Do you not place any importance on that? I thought that might make this next predicted 'bubble phase' a bit smaller in proportion to the previous ones, but then again the longer time it takes to reach the next bubble the bigger it will be, so that would cancel the negative willies out. The author of Willy report didn't seem to understand the price action on Mtgox has no bearing on bitcoin price as Fiat can't be withdrawn. The rally from 100 usd to 1100+ is mainly due to China demand and widely being reported on China news network. Title: Re: The next crash Post by: Este Nuno on July 05, 2014, 04:37:38 PM The bitcoin market is changing and evolving quite a bit and while this is interesting analysis I'm pretty sceptical that it will hold up to the new and changing market conditions.
People in bitcoin do love a good crash though and it seems everyone loves to try to sell out to buy at a cheaper price later. That's one constant in bitcoin that is going to be a very hard habit for people to break if it's ever going to go really far and become less volatile. Title: Re: The next crash Post by: InwardContour on July 05, 2014, 07:29:14 PM Nice predictions, I roughly agree with you though I'm not sure it will take quite so long (until January) to reach the peak, though it might, depending when the ETFs launch. But what about the Willy report? Do you not place any importance on that? I thought that might make this next predicted 'bubble phase' a bit smaller in proportion to the previous ones, but then again the longer time it takes to reach the next bubble the bigger it will be, so that would cancel the negative willies out. If the ETFs are needed for the next growth spurt a peak in January is early I would say. I don't think it will take this long but it might. I agree, and I think we may need an ETF to get the influx of money needed to reach all-time highs again. All the ATMs that are coming online around the world may also add an unpredictable amount of fuel to the fire if/when bitcoin really rallies again. Title: Re: The next crash Post by: Benjig on July 05, 2014, 08:06:24 PM Hodl! and if it crash just buy more at the bottom and hodl more! that strat has been working for years, should keep working
Title: Re: The next crash Post by: okthen on July 05, 2014, 10:16:14 PM I like your analysis!
Specially 'don't sell for two weeks after $3300' part. I was thinking of starting to sell after $3000, but you convinced me to wait :) Title: Re: The next crash Post by: ajareselde on July 05, 2014, 10:23:02 PM Hodl! and if it crash just buy more at the bottom and hodl more! that strat has been working for years, should keep working im gonna be the black sheep here, but i dont realy see much fundation in your expectations. there is no way this current comunity can push bitcoin into above 2k range anytime soon, not that it doesnt want to, but it lacks the wealth to do so. appreciate the effort tho. Title: Re: The next crash Post by: wachtwoord on July 06, 2014, 03:15:24 PM Hodl! and if it crash just buy more at the bottom and hodl more! that strat has been working for years, should keep working im gonna be the black sheep here, but i dont realy see much fundation in your expectations. there is no way this current comunity can push bitcoin into above 2k range anytime soon, not that it doesnt want to, but it lacks the wealth to do so. appreciate the effort tho. There's no way? Have you paid attention of any of the news in the last weeks? Title: Re: The next crash Post by: okthen on July 06, 2014, 03:28:29 PM Hodl! and if it crash just buy more at the bottom and hodl more! that strat has been working for years, should keep working im gonna be the black sheep here, but i dont realy see much fundation in your expectations. there is no way this current comunity can push bitcoin into above 2k range anytime soon, not that it doesnt want to, but it lacks the wealth to do so. appreciate the effort tho. I see you've been around since 2011! Why so pessimistic? A couple of big businesses buying in would be enough to drive the price to 2000. And if it goes there, it'll probably keep rising. Title: Re: The next crash Post by: aminorex on July 06, 2014, 05:02:52 PM There is only one environmental requirement left for a price spike: Sellers dry up. Usually this is the result of coins moving from weak hands to strong hands. That is like reducing atmospheric pressure. Volume will go down before price goes up. Then when a trigger event occurs or a critical demand level is reached in some other way, the spike begins. The last bit is like the transition from superheated to boiling.
Title: Re: The next crash Post by: wachtwoord on July 06, 2014, 05:27:27 PM Yeah there is still too much volume I think, but we're getting there.
Title: Re: The next crash Post by: Este Nuno on July 07, 2014, 03:27:21 PM What if ajareselde is right and anyone who was going to buy bitcoin has already bought? It's not like it's a secret anymore. And there's a huge group of people who are simply not capable of understanding or being able to use bitcoin. It's not easy or safe for the average person.
We've already hit China but maybe there's still more market there in China to reach. The big one that we haven't hit yet is Wall St. so hopefully this ETF gets some action going. Title: Re: The next crash Post by: wachtwoord on July 08, 2014, 10:49:38 AM What if ajareselde is right and anyone who was going to buy bitcoin has already bought? It's not like it's a secret anymore. It is very unknown still worldwide. Further, from the time of discovering Bitcoin to the time of buying takes a certain lead time and with less technically skilled people joining as the circle is expanding, this lead time is ever increasing. Title: Re: The next crash Post by: Este Nuno on July 10, 2014, 02:52:19 PM joining as the circle is expanding :P Yeah, I agree that there is still more potential. Something like Circle is going to be required though to take Bitcoin and present it on a simple level to the average person who isn't going to be handling their own private keys. Title: Re: The next crash Post by: CryptInvest on July 10, 2014, 05:05:38 PM Not going to sell until the price reaches a minimum of 10k $ Manipulators can give any negative, I do not care.
Title: Re: The next crash Post by: wachtwoord on July 10, 2014, 05:10:06 PM joining as the circle is expanding :P Yeah, I agree that there is still more potential. Something like Circle is going to be required though to take Bitcoin and present it on a simple level to the average person who isn't going to be handling their own private keys. For the record I didn't mean Circle the company ;) Title: Re: The next crash Post by: BitchicksHusband on July 10, 2014, 05:12:22 PM joining as the circle is expanding :P Yeah, I agree that there is still more potential. Something like Circle is going to be required though to take Bitcoin and present it on a simple level to the average person who isn't going to be handling their own private keys. For the record I didn't mean Circle the company ;) Aka Duke Nukem Forever. Title: Re: The next crash Post by: Este Nuno on July 12, 2014, 11:19:29 AM joining as the circle is expanding :P Yeah, I agree that there is still more potential. Something like Circle is going to be required though to take Bitcoin and present it on a simple level to the average person who isn't going to be handling their own private keys. For the record I didn't mean Circle the company ;) Maybe consciously you didn't but their subliminal marketing seems to be working. :P Title: Re: The next crash Post by: dennydotco on July 12, 2014, 08:16:32 PM joining as the circle is expanding :P Yeah, I agree that there is still more potential. Something like Circle is going to be required though to take Bitcoin and present it on a simple level to the average person who isn't going to be handling their own private keys. For the record I didn't mean Circle the company ;) Aka Duke Nukem Forever. Ha by the time it came out I was completely over it. Didn't even care anymore. Title: Re: The next crash Post by: Joe200 on November 20, 2014, 06:08:41 PM For historical record, here is the original post of this thread.
tl;dr. * This is an analysis of previous crashes and what they might tell us about the next crash. * I looked at crashes 45% or more, because I don't think it makes sense to attempt to sell in a smaller crash. * Only 4 such crashes so far. Here are my guesses (really guesstimates) based on these 4 crashes. * The trough after the next crash should be at around 3,300, with anything from 2,300 to 4,600 being plausible. * The next peak will be at the very least 4,200. Don't sell before 4,200. * Once we reach 3,300 on the way up (the likely trough after the crash), the peak will happen anywhere from 14 to 27 days from then on. Don't sell for at least two weeks after we get to 3,300. * Here are predictions for the dates. Read more below for details and limitations. * Peak: mid-January. * Trough: mid-May. Background. This is an analysis of previous crashes and what they might tell us about the next crash. In my original draft about crashes (https://bitcointalk.org/index.php?topic=291006.0), I considered all price declines of 15% or more, even if they were not off the All Time High. I restricted my second analysis (https://bitcointalk.org/index.php?topic=610189.0) to only ATH's. I then saw an interesting post by JulieFig (https://bitcointalk.org/index.php?topic=634245.0) and decided to drop the ATH restriction again. A quote from JulieFig. I simply defined a peak as a new ATH. However, this is assuming the magnitude of the peak that occurred in June 2011 is an outlier in terms of datapoints, but the date at which it occurred aligns with the proceeding peaks. Excluding this June 2011 peak magnitude, the peaks following (Jan and August 2012) could be considered ATHs. It is an assumption, yes, but a valid one (imho) considering the smaller user-base in the early years, and arguably less reliable exchange data. The crashes so far. These are crashes of 15% or more. Code: pk.date pk.dow pk.price tr.date tr.price drop ft.date ft.price n.dest n.be * Crashes from an ATH are labeled with a number. Those not from an ATH are labeled with a letter. * 12 crashes in all. 9 crashes from an ATH. * pk = peak, tr = trough * ft = "foot". According to my simplistic algorithm, this is when the next move up begins. ** Trough and foot for the current crash(es) are provisional. * n.dest = number of days of gains (prior to the peak) that were destroyed in the crash. * n.be = number of days to break even if you bought at the peak. * Take a look at the days of the week for the peaks. It's mostly the weekend or thereabouts. What does this mean? Code: Fri Mon Sat Sun Thu Tue Bigger crashes. Are 15% crashes all that interesting? Can they even be considered crashes? Given how volatile bitcoin is, I was actually surprised that it only fell by 15% or more a mere 12 times. In a previous discussion, I figured out that, for many people, the expected drop would need to be 65-70% for them to sell (https://bitcointalk.org/index.php?topic=611975.0). For a risk-tolerant person who is paying taxes in the US, the expected drop to sell has to be at least 55%. Let's look at the crashes of 45% or more. Because if a crash is less than that, it's probably not worth your while to sell. Do you agree with this? Is this good reasoning? Code: pk.date pk.dow pk.price tr.date tr.price drop ft.date ft.price n.dest n.be * Only 4 "real" crashes so far. Predictive ratios and durations. Let's see if we can find some ratios and durations that repeat consistently enough crash after crash. Code: pk.date pk.price r.tr.pk1 n.dest n.tr.tr n.ft.ft n.pk.tr * r.xx.yy = ratio of xx to yy. n.xx.yy = number of days from yy to xx. * r.tr.pk1 = the trough price of the current crash divided by the peak price of the previous crash. * I could not find a price ratio for the peak that was consistent enough. Ideas? Based on these 3 or 4 observations, here are my guesstimates for the future values. Code: name p_25 p_50 p_75 Predictions. * Let's start with a prediction for the trough after the next crash, using r.tr.pk1. The trough should be at around 3,300, with anything from 2,300 to 4,600 being plausible. Code: p_25 p_50 p_75 * I could not find a ratio for the peak that was consistent enough across these 4 crashes. However, since we are looking at crashes of at least 45%, and since we have guessed the troughs, we can calculate the minimum peaks based on that. The likely peak will be at least (that is, if the crash is only 45%) 5,900. The lowest plausible minimum peak (that's a mouthful) is 4,200. No matter what, don't sell before 4,200. Code: p_25 p_50 p_75 * For n.dest, the prediction is given above. The next "big" crash (45%+) will destroy about 19 days worth of gains. Anywhere from 14 days to 27 days is plausible. Since we've estimated the trough, the other way of looking at it is like this. Once we reach 3,300 on the way up (the likely trough after the crash), the peak will happen anywhere from 14 to 27 days from then on. Don't sell for at least two weeks after we get to 3,300. * To make predictions based on the other durations, I am using a truncated distribution. This is because we know that these events will occur after today -- this gives us extra information. This also means that the predictions below will change as more time passes. Code: name p_25 p_50 p_75 * The peak is likely to occur sometime in mid-January. It's plausible any time between early November and mid-April. * The trough is likely to occur sometime in mid-May. That's 4 months in a bear market. Could be any time between late March and early July. So could be half a year or more of bear market. * The foot -- the beginnings of the next move up -- could be some time in early June. The foot has to come after the trough, and the above prediction does not account for that. This is a weakness of this prediction. Previous version. (https://bitcointalk.org/index.php?topic=610189.0) Title: Re: Previous crashes and recoveries Post by: Joe200 on November 20, 2014, 08:55:35 PM Just posted an update on the main page.
Title: Re: Previous crashes and recoveries Post by: spiderbrain on November 20, 2014, 10:00:42 PM Great thread, thanks!
Title: Re: Previous crashes and recoveries Post by: Joe200 on November 25, 2014, 05:42:47 PM Peaks and troughs are not equivalent. I detect peaks as the highest price before a drop of X%. The troughs are the lowest price before the next peak.
The above shows peaks and troughs in the price of BTC/USD. For another perspective, let's look at the price of USD/BTC. For convenience, I convert it back to the BTC/USD scale. All drops in the price of USD in terms of BTC of 15% or more. Code: pk.date pk.dow pk.price tr.date tr.price drop ft.date ft.price n.dest n.be n.tr.pk n.ft.pk * Peak is the peak USD price, which is a BTC low. * 10 USD price drops in all (BTC price rises). * 3-6: 4 lower peaks, followed by a huge USD drop. Peaks 7-10: we've just had another 4 lower peaks. * 2, 6: Trough higher than previous trough. The following peak is higher than previous peak. 10: trough is again higher than the previous trough. Will the next peak (BTC low) be higher than 324? * Two big bull markets (in BTC): 0.05 to 29.6: 318 days. 2.14 to 1,130: 741 days. Does anything look interesting to you? Title: Re: Previous crashes and recoveries Post by: mmortal03 on November 26, 2014, 11:18:45 PM Does anything look interesting to you? Nope. I need visuals! |