Patience young grasshoppers.

I was here in April, so I know from experience that one can lose just as much by selling into real rallies as one can by buying into false ones.

Since I started, my overall performance hasn't been a whole lot better than the market.  I hope to do better this time.  

Best of luck.

To say that difficulty "dictates" price is too strong.  I've always said that the relationship is a two-way causality.

Its just basic logic that when difficulty is high and price is low, if someone wants bitcoins they will buy them (and push up the price).  Conversely, if difficulty is low and price is high, mining them is cheaper.  I charted this oscillation (see my sig).

The correlation, however, is quite loose.  That's why price skyrocketed far beyond difficulty, and then plummeted far below the cost of difficulty (electricity + equipment).  I expected the correlation to be tighter (that difficulty would support a higher price floor), but price has turned out to be too volatile. 

I have to accept that of the two, price has been the primary driver.  I hope I don't have to wait until 2013 for more evidence of the flip side.



It would be nice and rational if the correlation was tighter, because then speculators would more readily accept difficulty as a "fundamental" measure of the bitcoin economy.  But the market is not necessarily rational.  And getting its participants to collude is not easy (especially if you aren't extremely well-capitalized), even if it is for the greater good.

I think the bid/ask wall activity is by a well-funded (and heavy-handed, with big balls) aggressive type of market maker.  Having a large portion of the funds in a market doesn't make one a manipulator.  Bid activity may be automated, that is fine.  Its still real.

Wash trading, on the other hand, is manipulation.

I have to agree with ElectricMucus.  Because Elliott Waves are principles of mass psychology, you wouldn't expect them to work on the smaller timescales.  Mass psychology tends to change on a day-to-day or year-to-year basis, not minute-to-minute and hour-to-hour.

While the fractal nature of Elliott Waves is appealing, I doubt it scales more than a few orders of magnitude either way (bigger or smaller). 

This question is especially relevant to the 200-year dow chart you posted above.  We're supposed to be at the peak of the fifth wave of a supercycle or a grand-supercycle, but it doesn't appear we've yet seen the first (impulsive) reversal wave down.  Its mostly bounced back from the 2008 crash (mortgage crisis) and the 2011 one in October (euro crisis).  Maybe IF the China "bubble" pops, that would be the tipping point.

I'm not sure I buy Elliott Waves on such a long timescale (again, time long-past should have little effect on mass psychology). 

If we are at the beginning of a fifth wave down, I probably shouldn't be considering opening a short position on TLT, as cypherdoc recommended in his gold thread.

I wouldn't be surprised by a mild weekend retracement.  Those who did some profit-taking at $3 should have enough USD to buy the dip.  I would only expect very mild selling pressure since the mid-term technical indicators have turned positive accross-the-board (MACD, RSI, EMA, ..).

Bouncing back up from the dip, $3 will be broken (i.e. it will surge past; stalling at $3.10 like now means $3 is only being tested). 

Breaking $5 would all but confirm a reversal.  But that will require new deposits.  So I do expect some weekend dips and mid-week rallies, the correlation seen during the run up, but failed during the downtrend (when there weren't new deposits).



+1.  I also remember the other heat-map chart.  This new one is great and I hope to see more.

I suspect that that algorithm is not working properly.

I have doubts that we're hitting a top around $3, before descending to test the lows.  My non-Elliott reasoning leads me to bet that, this time, the trend has changed.  The bid walls, trade volume vs. bitcoin supply, and a hunch that it will be easier for the heavy hitters to bank on a $2 reversal and push it upwards from here rather than downwards).



I have to reiterate this.  I see that you're charting a triple three combined correction (WXYXZ).  I suppose because you're aiming for that $1 pricepoint where "A correction usually finds its lowest point in the area of the fourth wave of the preceding impulse wave of the same degree."



I attempted an alternate, which counts a reversal at $2.  I believe it still honors your past counts, because most of the waves coincide (impulse to impulse, corrective to corrective).  I get a double three (WXY) rather than a triple three, by counting the first drop to $2.04 on Oct 19-20 as the third wave down, rather than the fifth and final.  This way the third downward wave is the longest ("whereas upward fifth waves tend to be longest in commodities it is less true on down trends, where third waves tend to be longest for all asset classes.")

The alternation looks good this way too (corrective wave II is sideways, and IV is sharp) [13.4 Principle of Alternation].

The fifth wave down just extends only $0.10 past the third (to the low of $1.9449), but I believe that's valid.  Notice any violations?  It's not an ideal shape, but I hope it does the job.

You could probably come up with something prettier that doesn't test $2 again.

Wow.  Epic thread.

I count Netrin making three stunning calls:

1)  On Oct 26 he called a ~$4 top.  The price popped then turned down on Oct 29.

2)  On Nov 12 he predicted predicted a crash from ~$3.20.  Price fell from $3.00 to $2.10 two days later on Nov 14.

3)  On Nov 16 called a top at $2.6.  Price had already started declining.

Someone else should double-check the timestamps to verify these weren't made after the fact.

I learned my lesson by losing a lot of potential gain on the first run up from $1-$10.  No way I will sell into a real rally (that's assuming a reversal, obviously), but others will have to learn their own lessons.  

This time some short squeezes could propel it even faster, and burn some stubborn bears.  Even I was a bit surprised by this new wall!

Do twinkies count as bread?

In all seriousness, the Christmas present I'm wishing for is $5 BTC.  I'd be ecstatic with that.

Well, I spoke too soon.  The consensus was right, the $2.20 wall for 50k was removed, panic selling ensued down to $1.9999.

It does appear to be a very aggressive type of market maker.

There's now bids for 100k over $2.  In my favor, the fact that $2 held has some starting to accept the possibility of a bottom.

It was linked in the press thread:  http://siliconangle.com/blog/2011/11/17/500000-bitcoins-transferred-in-one-exchange/

And I followed the change to this addresss where it is currently:  http://blockexplorer.com/address/1CKmEA8NcSASCwbByFGQXbsnvWz7K5p7hs

Its probably MagicalTux consolidating coins, has anyone asked him on IRC?

How about that 500k BTC transfer?

Last time that many bitcoins were transferred in the blockchain, it was MagicalTux sending 424,242.42 BTC to prove control of MtGox deposits.

The same logic which had people buying at $30, because $100 was next.

Bitcoinica didn't just open yesterday.  Yesterday's volume was a major outlier, which can't be hand-waved away.




Volume of almost twice the previous record qualifies as "enough panic", IMO.  Or, he's gonna drop the wall and everyone will panic sell at $1.xx?  That does sound crazy.  How many people would still be holding, with a stop-loss below $2, especially given yesterday's record sell-off?  Not many, I wouldn't think. 


The simpler explanation is that there's a big buyer who bought a bunch of bitcoin, and who is ready to buy at least 50k more.  He's broadcasting a direct signal to the market.  Whoever was selling either ran out of BTC, or got the message.


Market, meet bottom.  (unless it isn't.  i suppose it could be a ploy to mindfuck and manipulate the market sheeple into buying now and panic selling later at $1.xx, if they're dumb enough).

I don't buy this.  $100k bluff bids would be a risky way of 'cashing out'.  Dude is buying bitcoin.

The record volume, ~375k BTC is almost double the old record (which was closer to ~200k BTC).  That seems to me to be a game-changer.  If this volume was mostly someone trading with him/herself (phantom volume of a manipulator), or otherwise normal volume of market-makers, then why was it never this high before?

If we assume that this is not normal or faux volume, then we conclude that some BTC was traded.  Someone cashed out, and someone else cashed in, and unless the price stalls here, there will be a wrong side of that trade.

Seems to me that the market is panic selling before $1.xx (near record volume the last big dip a month ago, mostly around $3 and bottoming at $2.04, and again in huge record volume mostly around $2.50 and bottoming at $2.10).


If a lot are waiting to buy in the $1's (and it seems to me that they are), who will be there panic selling in the $1's?  Early adopters and Mr. Manipulator?  hah.  The joe bitcoin who was manipulated into buying at $2.28 by a bid wall at $2.20?  Is he gonna panic sell at $1.50?

I call bottom.  (could be wrong - $1.5 btc for xmas?)

*ahem.  could be wrong.

I'm of and for the 99% as much as the next Occupy Wall Street protester, and my first fiat->bitcoin exchange was at least in part motivated by an anarchist desire to "boycott the federal reserve".  I hopped on the bandwagon and also advocated it as a "people's currency" - decentralized and p2p.  But I was naive.

I don't believe that the founders/early adopters with similar motives were disingenuous.  I think most were genuinely surprised (but perhaps not appalled) to see bitcoin coopted by government fiat - pumped and dumped in a most viciously capitalist manner.  Why would a crypto-anarchist be any more immune to greed than the next guy?

Sure, I want to rage against the machine and I hope I live to see the day that the dominant system is made obsolete by a new paradigm.  I hope I can contribute to that transition myself.  But in the meantime, I'm just another dog in a dog-eat-dog society fighting for survival.

In the current, "real world highly inter-connected economy", "cash moves everything around me".  Everything is for sale, even livelihood has its price and the value of all assets come from speculative powers far outside of my control.  Therefore, I am a gambling man (or dog, so to speak) because I have no other option that I can see (and maybe that's my own failing).


I'm in it for both, though I must admit that thus far, I've done much better with the technology than the 'musical chairs'.

It's clear to me that the technology and potential of bitcoin will only take it so far: a speculative decentralized e-commodity.  Forex for phreaks, gambling for geeks and money laundering/tax evasion for little more than chump change (unless the bubble re-inflates).

Technologically, its a new paradigm.  Socially: more of the same.


Bitcoin embodies the ideals of pure anarcho-capitalism.  Not surprising, given the capitalist hegemony.  Bitcoin alone is not, IMO, a seed for social progress. 

Bitcoin is set square in the sights of speculators (or vampires if that's how you see them).  The infrastructure seems built primarily for them (as opposed to merchants or craftsmen) and the only way they'll ever go away is if the money goes first.

I think you are right to look elsewhere for something more aligned with socialism, communalism, anarcho-syndicalism or whatever you want to call it.  OpenTransactions, Ripple, the MetaCurrency Project, the P2P Foundation, and community gardens seem like good places to start.

Bump and cross-link to Elliott Wave Educational Video Series - a seminar of Prechter's from "more than 15 years ago".