I keep looking at the BTC volume, and then at the fiat volume, and it's hard to decide which one is the more significant indicator. BTC volume is down. But fiat volume is up (never been higher).

The market right now is in a state where it weak, low-volume, manipulated, and spring loaded for capitulation. It takes good news and good news just to keep the price afloat at this unnatural level but every time there is a negative news, the manipulation breaks.

But we all like trolling

Here's my view of it: Intuitively, one might think that some particular news item x has a clear, maybe obvious effect on price. If you read for example the wall thread, it's pretty clear that's a rather popular idea there. In reality however, while news affects price, the question of *how* and *how much* some news item affects price is not set in stone, but rather dependent on how it is *interpreted*.

So the same news item, in two different market situations, could lead to drastically different results. Example: the SR takedown. Imagine asking on the wall thread a week or two before it happened how price would react if SR is being taken down by the FBI. I'm quite sure the intuitive answer would have been "terrible crash". And during the first few hours after the news, that was indeed the reaction. But then we discovered support, probably because of built up buying pressure, partly also because China had began to enter the game, and people started realizing that maybe it's not all that bad for BTC to cut its ties with the criminal market (not that it really did, but that what it looks like to the outside). And suddenly: huge rally.

So I can't speak for the others, since I'm taking a sort of middle position: news matter, but *how* they matter is heavily context dependent. And while I don't think *any* news can trigger any price action, often enough the market is in such a state that many different types of news can trigger the same price response.

Applied to today: I don't think, for example, that if the news of today would have been "US government outlaws Bitcoin" we would have seen the mild recovery we've seen. In that sense, it did in fact help that overstock made the announcement. But on a different day, the same announcement would have only caused a weak "so what?". So in that sense, it wasn't overstock that somehow caused the trend out of nowhere.

(Bit of a rambling post, sorry. Too lazy to rewrite it )

http://en.wikipedia.org/wiki/Empirical_evidence

So, were those who expected the bounce this morning -- absent Overstock news -- wrong?

What is your evidence that the news caused the rally? You are suggesting that absent this news, the market would not have rallied. What is your evidence for that?

i'm guessing you don't have much of a background in science...

let me first point out that correlation does not imply causation, that is, just because it happened "at the same time" does not mean that A caused B or vice versa. cum hoc ergo propter hoc is a logical fallacy.

secondly, even if you value this hypothesis, you need to be able to support it with some kind of evidence. i'm not saying that it is definitely not the case that the Overstock news prompted the "mini-rally", but you seem to be claiming that it definitely is the case, without any supporting evidence whatsoever. this is a problem. if you don't ever second guess your intuition, you'll never realize how often it is wrong...

some things to consider about the limits of our knowledge:

when?: do you think everyone learned about the Overstock news at exactly the same moment? probably not. if it had an effect on price, it was likely "priced-in" a lot more gradually than your claim assumes.

how?: are you sure that the Overstock news should have an immediate bullish influence on the price? perhaps in the long run, because of increased adoption, but in the short run, there are actually some bearish possibilities.

the answers to both of these questions of WHEN and HOW news events and other external forces affect price are mired in the complexities of the market, and are the farthest, farthest cry from "simple facts that everyone can see with their own eyes".

i hope you took a moment to reflect on these important limitations to the claims we can make about price behavior.

--arepo

it's funny that you claim to know for sure what caused the move up. i would take the scientific approach and say that the fractal model is sufficient to predict that the price would move up after such a large volume bounce off of the moving support, and so Occam's Razor encourages me to ignore any other data. it is because of this that i believe market forces win against news every time. in fact, i have empirical evidence to support this claim, while you merely assume that it was the news

--arepo

I bought several handbags!  So excited!  They were on sale 90% off too!  And I used the small amount of coin I still had on Gox.  That is one way to get rid of coins left there! 

no time!

im just going to go to the store and order anything i think i would ever use... my wife will help so im sure it will get up there in $$$ terms

Good call, arepo. Let's see what the next days bring.

Ignore the people who think it all reduces to news. News matters, but not in the way they think it does.

how about making a random-crap-ordering-bot?

The true spirit of bitcoin.

I suspect some money transmitting issues or fear thereof?

Too bad this is basically bitcoin's last year, given all the confirmed bad news we have from sources, especially confirmed non-English sources, especially from China, but also other places.  The HODLERS will hopefully give us all time to get out above $10.

it's funny that you claim to know for sure what caused the move up. i would take the scientific approach and say that the fractal model is sufficient to predict that the price would move up after such a large volume bounce off of the moving support, and so Occam's Razor encourages me to ignore any other data. it is because of this that i believe market forces win against news every time. in fact, i have empirical evidence to support this claim, while you merely assume that it was the news

--arepo

I will be buying! Be back later with what I bought!

Hey Arepo,

Just wanted to say that I appreciate your posts and this thread in particular. I'm as hopeful as T. Stuart is for the long term but not sure how he justifies flippantly marginalizing your hard work, which since I began tracking it, has been extremely accurate.

While I can appreciate his enthusiasm and tend to agree that hodling will yield long term benefit and gain, isn't there value in short term gains in earning some fiat or making the right moves to maximize your btc holdings as well? IDK, I'm just a dumb noob with much to learn.

Just placed my order for random crap! Easy and so satisfying.

Bought some couch pillows and "stuff holder" for the shower. Amazing how costly "stuff holders" are. I suppose the lesson there is I need to get rid of some stuff.

Slight issue on checkout was mostly my end -- yesterday I had trouble getting Coinbase to load in browser and refreshed it several times at which Coinbase banned me from logging in for 24 hours. So on checkout from Overstock they wanted me to login to Coinbase to pay, but of course I had been banned, so I had to do a secondary option where I just scan the QR and paid from my iphone (which had previously been logged into Coinbase anyway). So, no biggie, it worked.

I was also concerned because I have had a failed Coinbase purchase at Gyft, 1.5BTC which now makes me wary about using Coinbase to pay, however the success notice at Overstock came absolutely immediately, no "up to 15 minute" wait like there is when someone has the BitPay intermediary screen (waiting for payment to hit the network). I imagine this is because Overstock is integrated with Coinbase.

I had purchased quite a number of things at Xmas via BTC and I only had to wait about 4-10 seconds for each to process through BitPay. This overstock purchase was immediate via Coinbase.

Thanks!  Good to know.  I can ship stuff to a US warehouse, so might do that if I see anything exciting.