|
Eh. I'd cut Mat some slack. He had the right intuition all throughout the bear market, when a lot of bulls were still (or: again, and again) in denial. And despite what some people like to say, intuition is a big part of trading profitably.
My advice: develop some basic trading system that works for you, filter out everything that is not part of that system, and see if he can make it work better than his previous trading attempts.
|
|
|
|
My analysis (short to medium term) based on nothing but a gut feeling is the current rise is a tiny bit overextended, which is perfect for an engineered smack down designed to shake out a few loose coins to be snapped up cheap, before we resume a gentle uptrend. Long term, I think this is it for super-exponential rises followed by blowoffs. I think the 4-5 figure target is almost inevitable in the 2-5 year timeframe, but I think the route by which we get there is going to be very different to what people are used to and fraught with peril. Forgive me for the lack of chart to back up my rambling  I have a hard time believing that. We agreed somewhere else that the patterns will probably become more difficult to recognize, but it's one of the very few bets I'd actually be willing to make: we will see another bubble cycle that differs from the previous ones only gradually (say, price increase by factor 5 instead of factor 10). |
|
|
|
Thinking that you can gain an advantage in a game of chess against an opponent who has access to the same information as you (the board, pieces, the agreed upon rules) is a mistake. |
|
|
|
Serious question, to those who are deeper into the matter: Is there any way bundled hashrate could be identified and punished, or maybe rather: non-centralized hashrate gets a "discount" at solving blocks?
I'm not talking about an easy fix to the ghash situation here, just wondering what is theoretically possible in limiting hashrate centralization.
You are right the key trick here is to identify hash that is under a single entities' control. To do so in a decentralized manner, we must create an incentive to mine coins to the same output address (once a single entities' coins go to the same output address, its easy to make an algorithm penalize an output address that is getting lots of coins by reducing the mining reward or increasing difficulty for only that address). One way to do this would be to only allow coinbase transactions to spend to addresses with a long prefix (essentially a "vanity" address). For example, all coinbase addresses must begin with "1coinbaseTxn". So if you want to "look" like multiple entities, you must be continually devoting lots of processing power towards generating new coinbase capable addresses. There are lots of problems with this idea. For example, it encourages centralization because it could take a long time for a small miner to generate a coinbase capable address. Very interesting, thanks. I was thinking more along the lines of 'network comprised of uniquely identifiable entities, and how they interact'. As I understand it, there is essentially no way to identify the members of the network in a way that cannot be spoofed. I guess I'm wondering if there is a way to a) assign a immutable identifier to each miner and b) map how they interact, hoping that hashrate under a single entities control (or being in a pool) would act differently than isolated miners' hashrate. |
|
|
|
|
Serious question, to those who are deeper into the matter: Is there any way bundled hashrate could be identified and punished, or maybe rather: non-centralized hashrate gets a "discount" at solving blocks?
I'm not talking about an easy fix to the ghash situation here, just wondering what is theoretically possible in limiting hashrate centralization.
|
|
|
|
We're getting closer to a decision point, I believe: Bollinger band width is near a point where the market usually starts moving again. The (hidden) bullish divergence on the 2h MFI (works on 6h as well) makes me lean towards upwards breakout, but daily MACD is about to go negative which means there's also reason to go down, short term. Whatever way it moves at first though, I see a lot more potential to the upside than the downside currently: slow momentum is there (3d MACD positive, 1w MACD about to go positive), we're just banging our head against the daily SMA200 ~= 38% fib of entire downtrend ~= $650 resistance for now. One way I could see it resolve is a dip at first, down to around daily SMA20 (~$612), then gathering the momentum to break the $650 resistance on the rebound.  |
|
|
|
Three years ago I was buying silver and gold like an idiot.
Oh well, lesson learned. Don't buy into all the hype.
Yup, I was in the exact same boat. If only I had reversed the percentages of my portfolio for metals and bitcoin. Hmm, won't people buying bitcoin now be considered "buying into all the hype"? Or maybe in a few years... Despite the bulls who like to say with certainty "not a chance", I'd answer: sure, it's possible. I can think of several scenarios in which Bitcoin, more or less, fails, and people who bought coins at $650 would be thought of as "buying into the hype". There are still two good reasons to invest nonetheless: given the (admittedly) huge upside potential, the expected return might still be positive. And: I don't see most "failure" scenarios if one of them would happen as happening over night, so you could hope to get out in time before price approaches zero. In other words: it's rational to buy at this price, in my opinion. Just don't delude yourself that it's "riskless" or "a sure thing". |
|
|
|
I doubt we're going to be able to trade sideways much longer:  Unless it's September/October 2013 again. In that case, we have another 3 weeks of non-action ahead of us :D |
|
|
|
can anyone give me a dumb down explanation of all this (for noobs like me) greatly appreciated.
Here is a simple run-down in my own words: TA (Technical analysis) is a useful set of tools, but not always accurate. Moving Averages have severe issues for traders who count on them heavily. At/near the recent lows (~$400/BTC) the moving average Bears where extremely confident they should not buy, and that was clearly the wrong "signal". By the time key moving averages give a clear signal you probably missed a large part of the move, and/or certainly didn't get the best prices. That one swings both ways: "At/near the $1200 ATH, the moving average avoiding bulls were extremely confident that the rally would continue forever, and didn't sell in time." The daily DEMA 33/18 suggested by OP gave a buy signal ~520 on April 15, holding since then. That's not exactly perfectly catching the bottom, but far from shabby considering that we're now more than $100 higher. |
|
|
|
Well, I think that your remarks make a lot of sense but, as you wrote, they mostly refer to a trader point of view (I hope I'm not misunderstanding your words). At the end of day, what I'm trying to understand is only if we can really consider the bear market ended (for medium and maybe long term). To be more precise, I wonder if a stable green 1W MACD could be seen as a clear and unequivocal signal of reversal trend. I would say yes, but I'm not a TA expert, I'm just reading something about it and playing with charts. But there is this consideration from you that is pretty reassuring: whenever the 1w MACD turned green there was never a drastic and lasting price decline. The unequivocal answer is: there is no unequivocal answer. The limited history we have implies that, whenever 1w turned positive, the worst of the previous bear market was over. At the same time, maybe due to the lingering effects of the previous bear markets (like in 2011/2012), the weekly MACD crossover more than once was followed by another price drop. Assuming historic performance holds again, then, if you don't mind possibly holding through a month of further stagnation, possibly mild decline, then it is probably not a bad signal to get in. |
|
|
|
One entire month from the last update in this thread, but it looks like 1W green MACD is using more time than expected.
BTW it's a very thin red strip now...
Do you know if it ever turned GREEN for some short moments?
Just go back to September/October last year. Turned green, then red again for 2 weeks. Similar in December 2012. That said, in the entire history of Bitcoin trading I know (which means including mtgox data), whenever the 1w MACD turned green there was never a drastic and lasting price decline. The "worst" signal I can find is in the last December week in 2011. MACD turns green, if you wouldn't have waited for a period close you might have bought at slightly below $5. The rally continued to $7, then price fell sharply. Took another ~2 months before $5 was reached again. Sounds like a fantastic opportunity in retrospect, of course (buying coins at $5), but from a trader's perspective, that wasn't a very good signal, unless you got out at the $7 peak. |
|
|
|
There is none. But you know that much.
There are a select few assumptions that seem to be so well grounded in reality that it is a waste of one's productivity to constantly doubt them. If the day comes that they'd break, we'll be as well prepared as we are now to tackle the fallout from the event.
Thanks! I agree that the chance of those assumptions being broken is not worth worrying about; it would be like worring that three nuclear reactors may melt down and explode at the same time. However I would dispute the assertion that the two assumptions that I listed are "well grounded in reality" -- in the same sense that, say, physical laws like gravitation, conservation of energy etc. are. Basically the only "proof" of those two assumptions is that many bright people have spent lots of time trying to find fast ways to solve those problems, over the last 40 years, and failed. But that is not a statistically significant result, because the space of all algorithms, even of modest size, is extremely large; so even all that work has explored only an infinitesimal fraction of it. For the physical laws, in contrast, one can argue that all our collected experience and measurements are statistically significant "proof" that they work, at least in the realms that we have experienced. Doubting them (in those realms) is certainly a waste of time. Moreover, the techniques that we scientists use to find fast algorithms are such that we can only find "obvious" ones, in a sense. So there may exist a relatively short algorithm that quickly solves the bitcoin mining problem, say; but, even if we find it somehow, and check that it works in quintillion of cases, we may be unable to understand how it does it. (You are aware of the Collatz problem I suppose.) (You are not referring to the P != NP conjecture I suppose? It is just as uncertain, but it has absolutely no relevance to those two assumptions in the bitcoin protocol.) (By the way, until the 1980s many people were quite certain that the linear programming problem could not be solved in polynomial time, because many bright people etc. etc.. Some even had started to build a theory of "LP-complete problems". Then a Russian mathematician found a polynomial algorithm, by thinking out of the box.) I am. And it has. At least to 'what the protocol can handle in principle being thrown at it', not 'what the protocol is and does right now'. As long as there are problems that are hard to solve but easy to check, the protocol can be adapted to the threat that a particular problem turned out to be easy to solve after all. |
|
|
|
Philosophical squared circles? It seems Jorge has trolled us all. Good work, sir!   No. He pointed out a sloppy phrasing in a well-meant article, and then proceeded to blow its effects out of proportion. Okay, you're right. He trolled us  |
|
|
|
Saying that math concepts are in reality independent of a mind is like saying that the concept of a chair is the object to which it refers with the word "chair". I can think of the concept squared circle, does it have any reality outside of my mind? It seems to be an impossibility. https://en.wikipedia.org/wiki/Reification_(fallacy) Or, they might exist independently and at the same time it would be meaningless for us to speculate what their "existence independent of our perception" could be. That said, Kant pretty clearly was a proto-intuitionist when it came to pure math. |
|
|
|
Church Turing
Glad I am not an altar boy in Church Turing. Wow, so many happy today. Nice one. That's what I get for not writing the dash. Doesn't matter though. I'm sure it's well within the power of a TM to feel doubt about the confines of the TM. |
|
|
|
Maybe more principally, make up your mind what kind of trading you want to do: trading for (moderate) USD gains, and securing them as soon as possible? Then selling now probably wasn't a terrible choice actually. He bought those coins at $660, so he cemented a net loss. I think it's always a terrible choice to start trading again when you know and admit to yourself you are completely crap at it. It just makes no sense to me at all. Considering Mat wasn't even able to hold his coins in cold storage for a week I doubt he will be able to when he gets lucky to get in lower. Something will happen to shake him out of his position again, you can pretty much bet on it. I just meant that, right this moment, I see a slightly higher chance for a price drop than for a price increase, though I believe the upside potential to be a lot higher than the downside potential, so I'm personally not tempted to sell. So in that sense, if he'd be disciplined enough to trade like that, it might make sense to be in fiat now to make a quick buck during a drop. But agreed on the rest. Mat kind of seems to have some decent intuition for the market. He just completely lacks trading discipline and emotional control, from what I can tell. |
|
|
|
why don't you enlighten us as to why it isn't?
Because I am only an old retard, you are the ones who know bitcoin inside out. Do your homework, and tell me: where is that "pure incorruptible mathematics" proof? There is none. But you know that much. On the other hand, Church Turing is just a hypothesis as well, but you don't see any of us (including you) going on about tangents of "how it is maybe all just a meaningless, inferior form of computation we're doing here". In fact, your tenure is based on it, I'd argue. There are a select few assumptions that seem to be so well grounded in reality that it is a waste of one's productivity to constantly doubt them. If the day comes that they'd break, we'll be as well prepared as we are now to tackle the fallout from the event.(*) (*) (EDIT) which is not the same as there being a vulnerability in the implementation of the cryptographic methods. But that's not what you had in mind, if I understood you right. There are practical solutions (or so we believe) to that problem. |
|
|
|
|
Good luck, mate. Set an alarm for the night if you can, in case there's a sudden swing upwards, and if the drop you're expecting happens, don't get too greedy. Take a look at likely fib levels, maybe daily BB, and take a profit in BTC if you get the chance.
Maybe more principally, make up your mind what kind of trading you want to do: trading for (moderate) USD gains, and securing them as soon as possible? Then selling now probably wasn't a terrible choice actually. Or trying to maximize your profits over a longer period? Then I think you need to get used to letting profits ride a bit longer. But fuck this, don't know why I'm lecturing. You seem to know what you're doing, by and large.
|
|
|
|
I can give a quick overview of moving averages. A simple moving average merely takes the average price over the last x number of periods. So, a 5 day moving average will give the average price over the last five days. An exponential and double exponential moving average weights the most recent prices more heavily.
This is usually put on a chart in the form of a line. A moving average crossover is thought to be a buy/sell signal to indicate changes in momentum. So if the 5 day moving average crosses a 25 day moving average it indicates the prices have moved up. People use different periods of moving averages to try to better indicate profitable signals.
hope that helps.
Thanks for clearing that up, it makes more sense to me. Maybe one addition: Head over to Goomboo's thread if you're intersted, he's doing a very understandable introduction to average based systematic momentum trading. You need to understand one thing though (that took me a while to really get my head around last year when I started trading): there's a tradeoff... "momentum methods", like trading based on signals from different moving averages gives you the ability to backtest your method and parameters (what let_me_backtest_that suggested in his first post). That's a huge plus. On the other hand, momentum trading means, by definition, that you "follow" the market. You will sometimes miss the early part of a huge swing because your signal isn't there yet. You will sometimes enter a trade that will end in a slight loss, because your averages whipsawed (that means: they crossed over, but then the trend never really formed, and the cross over again in the opposite direction) Where I'm getting at: average crossover methods are a great starting place for a trader, in my opinion, if for no other reason than that they really invite rigor and planning, as opposed to "intuitive" trading which usually ends in tears. On the other hand, not everyone is comfortable with mainly "reactive" trading, which trading with averages is in the end, so you need figure out what trading style works best for you. |
|
|
|
Well anyway I don't know why people are so blind that they can't see fiat is the Ponzi and bitcoin is the way out of the Ponzi.
 I herd you don't like Ponzi so we created a new Ponzi to get you out of Ponzi CoolStoryBro: hehehehehe......  Even though you are being a little ridiculous with your comment, above, I believe that your comment highlights a decent point. Accordingly, I would clarify that neither bitcoin nor fiat is a ponzi scheme... To say that either bitcoin or fiat is a ponzi scheme is to overly simplify and to misapply the concept of ponzi scheme. Neither fiat nor bitcoin is so simple an arrangement - there are too many factors influencing each. Fiat is a ponzi scheme in the sense that the monetary system works in a way where all money in existence is created in the form of Debt - with interest. So you have to constantly grow the monetary base to repay the interests of the previously created money with new money that is itself more debt and requires more interest which requires more money as debt etc... So it truly is a Ponzi and can only collapse at some point but it is benefiting only the few that control the global monetary system. A fiat monetary system that is not a ponzi could be created by emitting the FIAT directly and without liability to this emission, the counter party of the fiat being the work of the participants in the economy. Yet it has not been designed in this way but has been designed in a way that gradually enslaves the majority of the population and shifts most of the wealth in invisible hands. On the other hand bitcoin is not a ponzi because it is an asset that is not the liability of someone else. If you have a bitcoin, nobody owes you anything about it. You just have your bitcoin and nobody else is involved in this position. It's like gold. Who could say that gold is a ponzi ? A ponzi implies centralisation and fraud. Centralised fraud is used to influence the expectations of the investors based on the creation of false past and present returns. The money of new investors is used to hide the fraud by actually paying these false returns to first investors instead of giving new entrants their fair share in assets. Bitcoin does not have returns - it only appreciates or depreciates based on its current utility and anticipated-utility in the future. Bitcoin does not have centralisation that can hide parts of the information about it's use and nature - everything is in the open in the blockchain. It's simply an asset that can crash or explode higher without counter party liability. Therefore, using the word ponzi for the global monetary FIAT system is appropriate. Yet using the word ponzi for the bitcoin ledger system is not appropriate. My point is that ponzi scheme is NOT appropriate for either. The government and its money system is much more complicated than some simple operation to rob the money of the poor for the rich, even though those kinds of dynamics that you describe are going on in the government.. NONETHELESS governmental systems remain much more complicated and nuanced as compared to a ponzi scheme which is generally a smaller operation designed smoke and mirrors to deceive.... surely there is some deception that is going on within government systems, as you suggest.. but ponzi scheme is NOT the correct concept and to attempt to simplify the fit into such a narrow definition is to oversimplify the various purposes and services of government.... Don't get me wrong, I am all for reform, and I am all for removing some of the corrupting influences of government and the disruption that bitcoin will be providing to potentially put more power into the hands of the people. At the same time, I would NOT be so deluded as to believe that the government is going to disappear in some variations of its current form in any time in the very near future... transitions of systems take time... and certainly, we will be witnessing some of bitcoin's effects on various governmental and monetary institutions in the coming years. Completely agree. But you're going to be feeling a bit lonely in here, with a nuanced position towards state and government like that. At least a vocal subsection of bitcoin enthusiasts are strongly enough anti government and/or anti central bank controlled money flow that "ponzi" would be one of the nicer words in their inventory for it |
|
|
|
|
Show Posts
