Bitcoin Forum

More options could be added if you provide them. ;D

There are more speculators (their bets neutralize each other).

Added. :)

it's very simple. there are always cycles of high and low volatility. now we are in low volatility. soon we will see a massive move

Of course.

But the fact that the low volatility lasted for so long is beyond my expectation and amuses me. So I opened this poll.

There's almost never just one thing: multiple dynamics are in play.

Growth in adoption vs. base unit inflation; speculation and hedging forming pricing channels; developing derivatives mechanisms allowing for tighter speculative/hedging movement; time-based lending and investment slowing the volatility oscillations; expanding asset pools that haven't been motivated into being deployed; global markets are relatively calm right now, reducing their effects on smaller markets; newer business models being made possible... the list goes on.

I think the biggest factor is influence from traditional global markets, and those will probably erupt very soon. That would cause significant volatility in Bitcoin.

the goal of the market has always been to find the true price of bitcoin.

the first year was pure maddens cuz bitcoin was manipulated into a huge bubble and then huge crash.

Now the playing filed is more even, and its getting more and more even. early adopters are securing at least SOME of their well earned bitcoin wealth in things like gold or something, late comers are building up bitcoin wealth, and all the while both early adopter and new comer are simulating the bitcoin economy more and more

end result: 5$ holds.... until it breaks! Up is the only option its only a matter of time but I'm talking years, but once we really do break out of 5$ it will be because bitcoin has hit a new "critical mass level" and over night bitcoin will go from 0.001% of world wide spending to 10%! bubble #2 will almost hit 1 millions dollars/BTC and then crash to the 100 thousands range.

in 5 - 15 years we will be saying "OK, We have 10% of world wide spending and growing, bitcoin is rated  AAA investment... so why the fuck isn't EVERYONE using bitcoin" and the answer will be "Can't teach an old dog new ticks, these things take time"

do you like my prediction?  ;D lol i have a dream, a fucking good dream!

making this dream a reality is fucking easy, spend bitcoin.... the more bitcion you spend at small ma & pa shops the more distributed the wealth is, the more distributed the wealth is, the higher the price. its that simple people, just keep dreaming  :D


good night new york! hello... Moscow  ???

so, we are all waiting for the most expected bubble in history of bubbles ?
:)

Does this look like something stable, to you?

https://i.imgur.com/55N0V.png (http://bitcoincharts.com/charts/mtgoxUSD#rg60zczsg2012-04-01zeg2012-05-01ztgSzm1g10zm2g25)

 - http://bitcoincharts.com/charts/mtgoxUSD#rg60zczsg2012-04-01zeg2012-05-01ztgSzm1g10zm2g25

That 30 day chart of April shows more than an 18% swing, high to low, in April.

http://goldprice.org/charts/history/gold_30_day_o_usd.png

The gold price has a 4.46% swing high to low this month. And the market cap of gold is many magnitudes larger than that of Bitcoin. 18% swing is almost a miracle with respect to such a small economy.

My first guess is bots with a relatively conservative policy flatten the peaks.
Another bane is all bids are highly speculative whilst the asks reflect the costs of mining.

The answer is obvious enough - (1) Bitcoinica and (2) more mature traders.  

Regarding (1), Bitcoinica's dampening effect took some time to set in, and the road here was bumpy as kinks were worked out, but I think, as many people predicted, leveraged trading through bitcoinica has effectively killed the extremely volatile bitcoin of the past; and it's unlikely, as long as something like Bitcoinica is around, it will ever return.  Bitcoin has grown up, and the days of "the rocket" are over.  I'm sure the price will increase, but I'm also confident it will be over a period of many, many years now.  It's doubtful the price will reach and exceed the all-time high for several years.  Even still, I think in the next two years we'll see $10 bitcoins again and that's still a fantastic return.

With respect to  (2), I think there are more professional and mature traders involved in bitcoin now and I think they're interested in and willing to accept lower profits than the crazy windfalls us early adopters went after.  When I started over a year ago I was expecting to and luckily ended up getting returns on my investment of hundreds of percent in a matter of a few weeks.  It was truly insane.  Now, I'll go after %5 or even less over, say, a few days or weeks and consider myself very lucky if I can manage that.  There are more people cashing out as soon as they're the slightest bit profitable.  This goes both ways, of course, and I think works in conjunction with (1).

So, there you have it.  If you want to make a lot of money fast, you'd probably be better off shorting/buying AAPL than playing with bitcoin.

http://img18.imageshack.us/img18/4972/gartnerhypecycleforemer.png (http://imageshack.us/photo/my-images/18/gartnerhypecycleforemer.png/)

Every day I wonder why the price has been so stable.  I have to step out of my micro view of the Bitcoin world and look at things on a macro scale.  The "gold" rush is over.  There was a time when we were seeing MASS influx of random new people, buying up 50 video cards at a time at Fry's, Best Buy, Microcenter, etc and watching the price skyrocket.  Those days are over.  All the people who are not serious about Bitcoin have left.  It is only the hardcore nerds that are left.  We may have another boom, but this seems to be a time to rest.  I'm basically explaining the charts that everyone posts though, just like the post above me.

Its not stable its in equilibrium..  The amount of new fiat coming into the system is about the same as new BTC is being added to the system via Miners.

Once the block reward halves and hopefully by then the popularity of BTC has increased (ie more fiat into the system), the price should start rising rapidly.

It's a lot of reasons, but I think the biggest reason is that miners are willing to bring their product to market too cheaply. They can't be making much over cost.

If I sell everything I mine per day, I'm looking at 60% over electrical costs, not too shabby.

Does that take into account your capital investment and maintenance, among other costs?

darlatino999 said electrical costs... so no.

FYI, Bitcoinica introduced interest system in mid-Feb.

Capital Investment was the cost of the additional 3 GPU's and 1 powersupply, that was paid off in the fall as the price slid down.
Maintenance - I have had no failures running 24/7 since October.

My net cost for electricity per 24h is ~$2.72 @ $0.103/kWh.

Now if we put a quantitative cost on my time I spend tinkering, I'm pretty sure I'm a factor in the US national debt :D

Not going to be for long... how do I know? I just sold some, so its going up.

SELL ALL THE COINS!  ;D

 now I'm starting to think the

"There are more speculators. Their bets neutralize each other."

might just be spot on...

That's some pretty cheap electricity.  That's why he is at 60% profit.

TH reason for the flat prices are not more speculators (we rather have fewer of them). The simple reason is the chart picture of bitcoin/USD. After a huge 3.5-fold rally from Nov 11, prices need to consolidate this rally. This will change after this consolidation is over.

I suspect Goldman Sachs and associates.

(And yes, I'm referring to the news from Reuters.)

This assumes either everyone involved with Bitcoin is trading, or the chart pattern is a self-fulfilling prophecy. Either way, the over-simplification is preposterous.

Remember: there really is a world outside of squiggly lines on a screen. Fundamentals trump technicals.

"Simplicity is the seal of truth."

But my rational mind does appreciate many of your posts miscreanity :)

"Nature is wonderfully simple, and the characteristic mark of a childlike simplicity is stamped upon all that is true and noble in Nature."
Excerpt from The Story of Alchemy and the Beginnings of Chemistry.

I am quite fond of simplicity and believe life as a whole can be greatly simplified, I am looking forward to an extreme simplification of the financial world.

Everyone has the right to believe what he thinks is right. I believe the socionomics theory more, whcih says that the market itself is the best leading indicator for the economy and social mood.

http://socionomics.com/ (http://socionomics.com/)

.....told ya it would happen.

Omg best indicator evar. ;)

Thanks :)

A corollary is that complexity arises from simplicity. My issue is that the level of analysis provided by S3052 pertains to the trading environment but was being applied to areas in which it is not appropriate. Trading is a major part of a dynamic system, but it is not the entire system.


Certainly. Now for some debate :)


Even when a market is no longer a market? Social mood can't change the fact that food is necessary for survival.

It doesn't help that I'm not fond of Prechter, to be euphemistic. Adherence to one side without flexibility to account for variable conditions has resulted in his incessant calls for gold topping and being wrong every time.

2009: Prechter Says Gold & Silver Due for a Major Fall (http://smartinvesting18.blogspot.com/2009/08/prechter-says-gold-silver-due-for-major.html)
2010: Gold could fall 40 percent from peak: Prechter (http://www.reuters.com/article/2010/06/07/us-investment-summit-prechter-gold-idUSTRE65652L20100607)
2011: Gold's Short-Term Move: Evidence of a Longer Trend? (http://www.elliottwave.com/freeupdates/archives/2011/08/24/Bob%20Prechter;%20Elliott%20wave%20theorist.aspx)
2012: Robert Prechter of Elliot Wave Intl. on how Social Mood Drives Markets (http://goldsilver.com/video/robert-prechter-of-elliot-wave-intl-on-how-social-mood-drives-markets/)

For a while now, fundamental reality has been the dominant force - not the whim of hopes and dreams. The "social mood" is being led around by the nose, and conditions are nowhere near right for "socionomics" to be valid. Maybe another decade or two from now, in China.

Exactly. But in the beginning the market lacked all the tools needed for everyone to be able to make the exact bets they wanted to make.

Now with well developed services to move funds to and from the exchanges, well developed bots to help shorten the reaction time to the market price action, the ability to make big bets on either side on bitcoinca and the fairly liquid biggest exchange is a nice basket of tools that allows game theory to fully play itself out and stabilize the price.

I voted: "There are more speculators. Their bets neutralize each other." because it's the closest to the above real answer. It's not just more speculators it's also more speculators with more tools that allow them more freedom and higher efficiency in their speculating. But ultimately these are just the players and it's the game theory that's really the cause of what we see (that "Their bets neutralize each other." part).

I agree with you that Robert Prechter has underestimated the insane money printing from the Fed and the effect that this had. At the same time, his real trading recommendations have mad big money. He does not give actual trading recos very often as a friend of mine who is subcriber told me. Prechter gives only about one recos per asset class every year or even couple of years. And these trade have either been stopped out quickly with minimal losses, or they pocketed huge gains. I.e. over the past 5 years, 2-3 S&P500 short recos were only losing 10-50 points each, and then one winner gained 600-700 points.

To those who voted for this - how does such a large and accidental group of people actually collude? The only way they could even DETECT someone defecting from this prisoner's dilemma would be if they all shared their wallet addresses with each other, giving up their privacy.

IMHO the early adopters and hoarders here can barely agree on anything. Remember the long and visible argument over BIP 16? No offense, but they lack the social skills and organization needed to maintain a conspiracy for days, let alone months.

Of course, I'm a hoarder too so maybe I'm just trying to throw you guys off... :P

After looking at these again, Bitcoin is starting to look pretty stable:

https://i.imgur.com/30Vrt.png (http://bitcoincharts.com/charts/mtgoxUSD#rg60zczsg2012-01-28zeg2012-05-03ztgSzm1g10zm2g205)

 - http://bitcoincharts.com/charts/mtgoxUSD#rg60zczsg2012-01-28zeg2012-05-03ztgSzm1g10zm2g25


That is, considering what is happening in precious metals:

http://finviz.com/fut_chart.ashx?t=GC&p=d1&s=m (http://finviz.com/futures_charts.ashx?t=METALS&p=d1)

 - http://finviz.com/futures_charts.ashx?t=METALS&p=d1

Where do you live if I may ask? Do you have your own solar park?

Last week when the exchange rate was $4.85 ish, I sent some USDs to my exchange account to buy BTCs needed to make a purchase.  Because of the reliance on the banking system to move those funds, I just got access to those funds in my exchange account today.

Because you were hoarding your bitcoins and not selling yours at the $5 level, for instance, and others were not willing to sell at that price either, that means that today I had to pay $5.10 for my latest trade.  At the same time, however, the price for the item that I purchased in terms of BTCs was lowered.

So even though your hoarding (and that of others) changed the exchange rate it made no difference to me in making my purchase.  My $100 of USDs bought the same item today just as it would have had I done so last week.

My interpretation of these events is that one or more people with some money to throw around caught on to the fact that Bitcoin was volatile despite no change in fundamentals, and so started playing volatility. Get enough people playing volatility, and volatility decreases.

Please tell me you meant it goes to .20/kWh.  I've never heard of anywhere in the US where electricity gets CHEAPER after the baseline right.

Gotta love the Southeast! Where the football dominates and the cheap electricity gets cheaper when you use more...in the winter at least.

http://www.alabamapower.com/pricing/standard-rate-family-dwelling.asp
http://www.georgiapower.com/pricing/residential/pricing/standard-service-plan.asp
http://www.mississippipower.com/pricing/pdf/R-52.pdf