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you are right, all trends are down now
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Here is a post from another thread, but it belongs here. Ah, the ever popular and controversial log chart. I actually like log charts for very large changes in price, so let's do it.
The rules of trendlines:
1) Trendlines are an analysis tool, not a law of nature.
2) The more points you hit, the better your line is.
3) The farther you extrapolate your line past the last point, the less predictive power it has.
4) Trendlines predict normal fluctuations. They become irrelevant after a major market shift that permanently alters market sentiment.
Great to engage with you in this meaty discussion.
I agree with you on points 1)+2), not exactly on rules 3) + 4). Overall, this is an art as you are indicating and no one does this exactly the same. And this is why we will very likely not agree with each other on any chart, and this is fine. In the end, what really counts is that one is more often right than wrong.
Now to the charts:
On rule 3) and 4) Many trendlines, including the 40 year log DJI chart, even work long time after the trendlines have been touched. I have many more examples.
The way you have drawn the trendlines is not really accurate.
(i) When drawing trendlines you have to always start at the lows and connecting these first. Try to find two significant lows and connect these. (ii) Then see whether you can find a 3rd or 4th touchpoint.
(iii) then draw a parallel trendline connecting highs. if this looks right, you have a great parallel trendchannel.
(iv) if a trendline is broken, then how will you see if this line is important? prices will accelerate the move if the line was really important.
You see this in the attached. And truly, this trendline is the most valid one, because
(a) prices have 4 or even 5 touchpoint lows
(b) the upper parallel trendline (green) also makes sense. bitcoin prices broke out of this line end April and is now back to that level
(c) prices held this line early october to Oct 15/16 and then
(d) at the EXACT time when this trendline was broken for the first time in more than a year, prices crashed -40% two days ago . This is why this line has been and still will be so crucial.
And what one should never forget: trendlines are there to be held and to be broken! When discussing trendlines, one must be aware of both, chances to hold and break and act (trade) accordingly.
Now, looking into the future, this line will either be reclaimed fast, or it will provide strong resistance. At the minimum, the underside will likely be tested soon. This is currently around 3.7-4$.
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Ah, the ever popular and controversial log chart. I actually like log charts for very large changes in price, so let's do it.
The rules of trendlines:
1) Trendlines are an analysis tool, not a law of nature.
2) The more points you hit, the better your line is.
3) The farther you extrapolate your line past the last point, the less predictive power it has.
4) Trendlines predict normal fluctuations. They become irrelevant after a major market shift that permanently alters market sentiment.
Great to engage with you in this meaty discussion.
I agree with you on points 1)+2), not exactly on rules 3) + 4). Overall, this is an art as you are indicating and no one does this exactly the same. And this is why we will very likely not agree with each other on any chart, and this is fine. In the end, what really counts is that one is more often right than wrong.
Now to the charts:
On rule 3) and 4) Many trendlines, including the 40 year log DJI chart, even work long time after the trendlines have been touched. I have many more examples.
The way you have drawn the trendlines is not really accurate.
(i) When drawing trendlines you have to always start at the lows and connecting these first. Try to find two significant lows and connect these. (ii) Then see whether you can find a 3rd or 4th touchpoint.
(iii) then draw a parallel trendline connecting highs. if this looks right, you have a great parallel trendchannel.
(iv) if a trendline is broken, then how will you see if this line is important? prices will accelerate the move if the line was really important.
You see this in the attached. And truly, this trendline is the most valid one, because
(a) prices have 4 or even 5 touchpoint lows
(b) the upper parallel trendline (green) also makes sense. bitcoin prices broke out of this line end April and is now back to that level
(c) prices held this line early october to Oct 15/16 and then
(d) at the EXACT time when this trendline was broken for the first time in more than a year, prices crashed -40% two days ago . This is why this line has been and still will be so crucial.
And what one should never forget: trendlines are there to be held and to be broken! When discussing trendlines, one must be aware of both, chances to hold and break and act (trade) accordingly.
Now, looking into the future, this line will either be reclaimed fast, or it will provide strong resistance. At the minimum, the underside will likely be tested soon. This is currently around 3.7-4$.
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Julz
Keep up the great work.
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Done. I am travellung . Hence can't post chats and also have typos... |
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Why do we believe that the trendline we have on the blog was the best way and most valid one?
because exactly at the poinz when prices penetrated this very line the decline accelerated big time.
this happened two days ago when prices declined about 40%.
this shows how important the log scale trendline was.
If prices climb again above that line the trend can continue. To do so bitcoin prices need to rise above 3.7-4$
Thus is nothing but impossible in the event of a short squeeze or a couple if folks with enough funds, given the low liquidity of this tiny market.
Unless this happens, there continues to be a mid term downtrend .
Either prices continue down or establish a lower steepness if the longterm trend.
We see new support levels establishing and we will communicate those soon.
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If this trend won't hold, then there are dark clouds ahead. Not only for prices but also for the bitcoin economy.
While the protocol will likely still remain secure and good, bitcoin growth and adoption will likely be harmed massively
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S3052, do you see the long term trend broken now?
Yes. Longterm trend is broken intraday. it needs a rapid reversal above 3.7$ and better 4$ to hold in the next 24 - 48h |
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Another fantastic day yielding another 20% return on original investment. If this is suffering then consider me a masochist!
Congrats. Did you short on bitcoinica? |
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Well done, not worrying about the last pip is the right thing.
There are nice 5 waves down to 3$ and the short term reversal from there makes this a valid count.
See bitcoinbullbear.com
Have a great trading day.
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Active times.. We have seen a big reversal upwards.
Could you elaborate?
A move above 3.7 $ will now confirm at least another move up.
see chart
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Active times.. We have seen a big reversal upwards.
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Exactly, even if it is difficult to predict the exact low short term, long term bitcoin prices are still in an uptrend.
And prices are the leading indicator, not news. this means prices will move up BEFORE you see more positive news. Regarding Occupy X, the people who got interested still first need to move funds to the exchanges, and this takes some time. The ones who are already having funds on bitcoin exchanges have an advantage.
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One have to admit when a short term call is wrong. And yes, the alternate scenario is now the active scenario.
Very few believe that there will be a strong up move once the irrational capitulation phase is over, and we will see. Weak hands are selling now, strong hands will collect the coins OR: bitcoin long term trend breaks and the entire bitcoin movement will slow down a lot. we will see.
And it is exactly for this reason why I have drawn this uptrend line months ago (many have called me stupid when I said that we will test this uptrend line). and if it breaks, big problem for bitcoins. People who own bitcoins should watch this line now closely. If it will not be held, it is very bearish. we see a decline below now and the next 2-3 days are decisive.
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I think since we are in a short term capitulation phase, picking the exact bottom is almost impossible.
Things can get very irrational now after the break of 3.71$.
we may even see 1$ again.
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well done so far.
lets see at which price you will cover or need to cover
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Your data is all correct.
However, bitcoin usd prices lead other data points: BTCUSD leads transactions and transaction volume.
And even if the bounce up will only be a small correction up from a longer term donwtrend, you are looking at an at least 38.2% retracement to 14.5 $. More standard is a 61.8% retracement which would equal to 21.2 $.
And again, bitcoin prices can make another low below 3.71 $ and would still have this big upside potential.
Everyone can decide for himself to wait before a breakout happens or already be in the market.
 (
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You could also set up mining rigs on the ground to provide heating for the folks in the parc during winter...
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