'Short' Got Screwed

[Kazu]

I saw a big wall at $100 and did something really dumb, sold some Bitcoins at a couple of dollars below, because I thought gox was lagging, but it didn't, do you think I should cut my losses and buy at $102 or do you think it will go sub-$95 again?

[Missionary]

This is not financial advice:

I would be very surpriced if the price did not touch sub-95 again, even if it is going up long term.

But you never know, there might always be a trigger happy chinese billionaire out there who would push us to new hights in a single click.

[Malawi]

There will be swings, and it will probably dip well below $100. You might wanna put in an order at your prefered price, and have a nap.

[Kazu]

Very well then, I guess I'll just have to become a short term bear :|

[Logik]

$100 is the new $10

[Kazu]

Bumping this again because of increased worry. As of posting I've lost over 10% :\

[Mike Christ]

Bumping this again because of increased worry. As of posting I've lost over 10% :\

Stop staring at the charts  

[romerun]

the men who stare at gox

[NikolaTesla]

You'll be fine if you purchase now. This coming week will see a bunch of new incoming money due to the MSM coverage of the Winklevoss story. Buy now, hold until the end of the week, sell Friday at 150-160 if you want a quick profit, or continue to hold long term.

[Kazu]

Got back in at 93 during the current dip.   

[Malawi]

Got back in at 93 during the current dip.   

Nice to hear.

It will most likely be a lot of movements in the price. I am pretty sure the general trend will be downwards for a month or more, but with spikes.
Like tomorrow when new money enters the system.

In a longer view, I think it will go back up again, and there will be new all time highs.

[BubbleBoy]

$100 is the new $10

$100 means that 360.000 new dollars need to enter the market every day just to cover the mining revenues, never mind short term speculators cashing out. A typical day of Mtgox trading during Sept-Nov last year moved $500.000, before the media frenzy. That's total volume, including day traders or older depositors who shift back and forth. Let those figures sink in for a while.

[Terpie]

$100 is the new $10

$100 means that 360.000 new dollars need to enter the market every day just to cover the mining revenues, never mind short term speculators cashing out. A typical day of Mtgox trading during Sept-Nov last year moved $500.000, before the media frenzy. That's total volume, including day traders or older depositors who shift back and forth. Let those figures sink in for a while.

What are you getting at with this post? It's hard to tell.

[seldon]

$100 is the new $10

$100 means that 360.000 new dollars need to enter the market every day just to cover the mining revenues, never mind short term speculators cashing out.

Assuming that all miners would sell all coins each day at this one exchange...

[mp420]

$100 is the new $10

I think $100 is the new $17.

[BubbleBoy]

I'm saying that $100 will make miners put a cashflow pressure on the exchanges that they weren't historically able to fill without a media induced mania; in a regular day there's simply not enough fiat entering the bitcoin system to cover the expense of mining at $100. Yes, bitcoin's security costs an amount proportional to the price of bitcoins, and someone needs to foot that hardware and electricity bill.

Sure, for the short term, miners can play the market and hold those coins - after a sudden price increase the difficulty is still low. But on the medium term, due to the competitive nature of the mining market, the difficulty will go up and the effective price to mine will follow the BTC price. There's nothing miners can do about this, difficulty will eventually catch up and eat their large profit margin until only the most efficient miners survive which are forced by the laws of physics to sell.

Note, I'm not saying that $100 is a "wrong price", there's no such thing with Bitcoin. I've acquired at 5-10$, sold at various 100$+ points, got back in an 50$ and liquidated at 100$. It's all in the timing. $100 might be a great price if you are expecting a speculative upswing, but $100 long term ? I don't think so, not if something fundamental changes in the immediate future.

[chiropteran]

$96 now, pretty damn close to your $95 buy-in price.  you may want to just take the small loss and buy now

[blueberry]

$100 is the new $10

$100 means that 360.000 new dollars need to enter the market every day just to cover the mining revenues, never mind short term speculators cashing out. A typical day of Mtgox trading during Sept-Nov last year moved $500.000, before the media frenzy. That's total volume, including day traders or older depositors who shift back and forth. Let those figures sink in for a while.

$360,000 dollars a day is a drop in the ocean in the global scheme of things. Especially considerng the amount of global media attention Bitcoin has just recently.

Also you are assuming that all miners will immediately dump their coins on the market. Realistically about half would, so the figure to sustain $100/BTC would be more like $180,000 a day.

[dropt]

I'm saying that $100 will make miners put a cashflow pressure on the exchanges that they weren't historically able to fill without a media induced mania; in a regular day there's simply not enough fiat entering the bitcoin system to cover the expense of mining at $100.

You're delusional.  Nowhere near all of the miners are cashing out all of their (daily) earned coins at Mt. Gox.  It just isn't happening and isn't going to happen.  

Yes, bitcoin's security costs an amount proportional to the price of bitcoins, and someone needs to foot that hardware and electricity bill.

 I wasted a bunch of my life and money getting an education and a job. Read: I pay for my hardware and power costs with the job I go to everyday.  Not one coin I've earned over the last year and a half has been sold for any of these purposes.  In fact, my recent ASIC investments were paid in BTC that I bought from an (not Mt. Gox) exchange the day prior to placing my order.

Sure, for the short term, miners can play the market and hold those coins - after a sudden price increase the difficulty is still low. But on the medium term, due to the competitive nature of the mining market, the difficulty will go up and the effective price to mine will follow the BTC price. There's nothing miners can do about this, difficulty will eventually catch up and eat their large profit margin until only the most efficient miners survive...

 I still have 80% of the coins I've ever mined and I'm not letting them go any time soon.  Also, it's still very profitable to mine with GPU's.  In fact, during the recent "bubble" it's been the most profitable (albeit in unrealized gains) that I've ever encountered.

which are forced by the laws of physics to sell.

 What? Please explain this gem.

[mestar]

$360,000 dollars a day is a drop in the ocean in the global scheme of things. Especially considerng the amount of global media attention Bitcoin has just recently.

Also you are assuming that all miners will immediately dump their coins on the market. Realistically about half would, so the figure to sustain $100/BTC would be more like $180,000 a day.

And that $180k will always work in a single direction, every day for the next 1000 days or more. (If the price stays at $100)

Cue metaphors about rivers carving the Grand Canyon or gravity being 10**39 times weaker than electromagnetic force.