Been wanting to chart this correlation for a while.  I'm not sure what to make of it.

My intuition is that unless the volume peters out, price will find a bottom.  At $0.10/BTC, $100k buys a million bitcoins.  But the record volume in BTC is between 100k-200k.

"volume should be lower during wave two than during wave one".  Its getting lower, but will it fizzle out?  Or will it pick back up?

Since you asked.


Continuously setting new lows for the ratio.  Difficulty doesn't seem to be "supporting" price, in the sense of propping it up or providing a floor.  But the network's resilience to a plummeting price is quite surprising.  Its the power of peer-to-peer and decentralization.

Maybe there's still a correlation.  Perhaps price "hangs" from difficulty - like a bungee cord or a rubber band.  A strong difficulty could launch the price like a slingshot, if that's the case.

Blood.  Thirsty.  Bull.

Think you could stomach $0.75 now? 


Buy When There's Blood In The Streets

its a great one.  Some additional comments:

a)  the only absolute rule for the corrective wave II is that it "can never extend beyond the starting point of wave one" (which was $0.00-$0.10).

b)  "prices usually do not retrace more than 61.8% of the wave one gains" - fat finger measurement places the 62% retracement of wave one ($0.10-$30) at about $0.75-$1.00.

c) "Wave C is typically at least as large as wave A and often extends to 1.618 times wave A or beyond."  - fat finger places 1.6 times wave A (from $30 to $6), starting from B ($12) to down around $0.75.


Drawing trendlines, and placing particular importance that the bottom of the long-term channel holds (it broke at $3.30) was "technical analysis".  Now by focusing on EWT, we're just practicing straight numerology (mixed with a little mass psychology)


Related:  Elliott Wave Educational Video Series

Edit:  former title "Elliott Wave Educational Video Series", a series of seminars by Robert Prechter recorded over a decade ago.

In the first session, Prechter gives a fascinating historical perspective on economics: why Wave I from the 1932 DJI low topped in 1937, and started correcting (Wave II) from 1937 to 1942.  Because, it looked like the Allied powers were going to lose WWII to the Axis powers (in other words, capitalism was losing to communism).  When the Allies started winning in 1942, the Dow resumed the upward trend, starting the largest and most powerful Wave III of the Elliot Waves.


http://stockcharts.com/freecharts/historical/djia1900.html - Dow historical chart


Analagous bitcoin chart?

Really thin order book reminds me of the good ol days...

Should have seen this coming..

The bouncing off 9/9 low of ~$4.2 and the $4-$5 range following was forming a pretty clear descending triangle continuation pattern.  Especially with the $6.75 high following $7.50.

Not a double/triple bottom (retrospectively obvious).

I'd like to make a prediction here, just for the record.

I see the latest drop as the third of a three-wave (Elliott) correction from the $50 silver top ($1900 gold), with 3 ($30) lower than 1 ($33).

It will resume the upward trend for a fifth and final wave (silver past $50 and gold past $2000), before the big crash / reversal.

Good point.

Singapore is a much better fit.

Once you've been to bitcoin.org you don't need to again (except to update the client).

This one looks hopeful: http://www.alexa.com/siteinfo/mtgox.com

Yes, now it is much better than before (bid side was plotted in BTC and ask side was plotted USD).  Now the asks are also plotted in BTC (the ask axis labels are still in USD). 

My preferred option would be to see both sides plotted and labeled in USD (with the BTC amounts in the mouseovers).  Then one can see how much USD can be cashed in/out to reach a price point, at a glance and without using mouseovers.

Do you think analyzing past changes in bid/ask depth (in addition to past change in price) could result in more accurate price predictions?

Nice little weekend rally for a change 

I guess this is just how the bid depth looks in a bear or buyers' market.  When sellers are aggressive and desperate, the ask depth spears into the bids and gets very thin (which is why price can snap back up after a sell-off). 

When buyers get desperate during a bull run and start panic-buying, its the bid side which gets thin and spears into the asks (sellers' market).

Right after May 14, price did drop from $8-$9 (to $6), as one would expect from that shallow bid depth.  But it was only two weeks later that it pushed through $10.  So while bids can get too thin and overextended (usually followed by a correction), counterintuitively, spear-like bids seem to be the norm in a bull market.

Conversely, spear-like asks are the norm in a bear market.  I don't see manipulation here, just oversold bears.

And today:


Looks bullish to me (but then again, IANAMA).

IMO, earlier on S3052 was generating self-fulfilling prophecies.  Back a few months ago when the daily trading volume was closer to $10k and all of his analyses were public (before his subscription program).  The market was small enough that it all it took to send the price up was one of S3052's charts with a green arrow, usually not long after he posted.

This influence seemed to lessen as the market grew bigger.

What do you mean "long term"?  We're barely in the 2nd trading day of ~$10/BTC.  Price is not just going to rocket to $15 (and then $20) overnight, after reversing from a downtrend.  First there's a bounce (because the panic-sellers sold-out), then a slow climb (cautious traders selling into mis-predicted tops), before a big rally (when most traders stop selling and the latecomers are panic buying) and a correction (profit-taking by the traders and panic selling by the latecomers).


+1. 

As for manipulators, judging from daily volume and activity, there's more than one major player (having $100k+ for ~$50k trades). 

And between the big players, its more complex than repeated attempts at pump-and-dump.  I suspected at least one manipulation downward, starting from $14 with ask walls and big sells (How to Manipulate the Market), which eventually led to the sell-off. 

We can call big aggressive bets manipulation (or at least attempts), whether upwards or downwards.  It bottomed at six, and from there the ones betting upwards have won the most recent battle.  And judging from the bid depth (which is deeper than asks at the moment), the bulls came out better-funded; they don't seem to be backing off just yet.  So the chances that this is a reversal seem high enough, that I recommend holding for now (with a stop-loss at $9).

Just happened again.  In the thin volume, a bull put up a wall at 7.7 with a bid for $40k.  A seller sold through the wall, pushing price down to 7.05.  The sell was almost 9k BTC.

You know the big trades are individual players because they are volume spikes on the 1-minute chart.

Difficulty is a sort of fundamental, and exponential increases in difficulty support corresponding increases in price.




When bitcoin was $1 the daily trade volume (on MtGox) was around $10k USD on low days and $50k USD on strong days.  By the time daily volume was above $100k+ on average, price was above $5 and on its way to $10 (volume was growing to a million).

Unless we see a massive decrease in daily trade volume from the current $500k-$1m, down to under $100k, I'd be very suprised to see prices below $5.

First, somebody bought up $7.5 to $8.5 (spending about $50k USD) and then put a $40k bid wall for 5k BTC at $8.5.

A seller called that bluff, and sold through the wall (about $40k worth of BTC), pushing the price down to ~$7.12.  Now there's very little depth between $7.1 and $8.5.

The players in this game have over $100k to play with.  Little guys are just dust in the wind.