Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

[d_eddie]

Arthur Hayes on options. What is implied is that futures and swaps are better for traders: Bitmex is doing it right.
This is only an excerpt. The whole piece is worthy of reading.

https://blog.bitmex.com/when-options-part-1/

Strike one! Traders will always do what is easiest if they can generate the same return profile.

Crypto volatility is very high. We are currently in a low volatility regime and 30 day realised volatility is around 40%. When pricing an option, the higher the volatility the more expensive the call or put. Therefore, option buyers, the speculators, must post high amounts of capital to obtain convex trades. In order to be cheaper than the BitMEX XBTUSD perpetual swap, the most liquid crypto derivatives product, the premium must be less than 1%. That is not possible when the underlying asset has such a high realised volatility.

Strike two! Traders will always gravitate to the product with the most leverage.

Market makers, I haven’t forgotten about you. For every buyer there is a seller. Writing options is a tough business. If the volatility is high, margin requirements for writers of options will be very expensive. Market makers must be able to write naked options while quoting. Writing naked call options on an asset that popped 40% in a few hours when Xi Jinping mentioned the word “blockchain” is risky. As a result, the margining systems employed by various platforms are extremely conservative.

The same set of crypto market makers quote crypto delta one and options products. They must decide how to allocate their capital. If the option requires more capital due to margin requirements and has less flow because it’s less understood and offers less leverage, they will provide less liquidity. If the brave speculator turns up to trade an option and you can drive a Tesla pickup truck through the spread, she will hightail it back to XBTUSD.

Strike three, and you are out! Traders prefer the liquid to the illiquid derivative.

I hope you enjoyed a nice primer on the crypto derivatives market structure and why delta one products will be preferred to options by speculators.

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[Icygreen]

Good morning,
Bitcoin looking like it caught a bid. Now at 8,245
Feeling ready for some action

[soxxx]

We have Bull Flag/Pennant breakout currently and it has a target of $8700.

[LFC_Bitcoin]

Woke up for a piss.

Observing $8,341.

Mini pump!

[soxxx]

Woke up for a piss.

Observing $8,341.

Mini pump!

We could be in for a wild night/week if this continues.

[LFC_Bitcoin]

Seems like a good time to re-post -

VEGETA GAME !!!!!!

$50 worth of BTC to one winner


Right, we’ve been under $9,000 for quite a while now. I think it’s time to PLAY ANOTHER GAME !!!!!!!!

Ok, this time I’m going to be clear on two rules -

1.) When the price crosses $9,000 on BITSTAMP you must post a Vegeta meme
2.) I also want a screenshot of the BTC price from BITSTAMP to prove it’s over $9,000

**If you post a meme but no screenshot - No win**

**You must post a Vegeta meme & the Bitstamp screenshot so I can verify the time of your post against when the price went over $9,000**


Thanks & good luck!

[eddie13]

Finally broke out of my downward channel lines just now..

End to the bear for a while now?
$10k in 2 months?

[bitserve]

I already said I am not expecting (hoping, yes) any more 5x-10x in a single year anymore.

I believe that I understand what you are saying, bitserve, but you better tone down the bullishness a bit.   

What I am suggesting is that two years in a row of 10x would still be a 100x, and even the most bullish of bitcoin prognosticators are not projecting anything like that... gosh that could put us in the $300k to $600k price range in two years (depending on foundational BTC price bouncing off point).

In fact I would prefer if we reach the stage in which Bitcoin stops crazily overshooting and overdumping afterwards for a more "sane and healthy" price growth instead.

Yes.. I recognize your rhetorical point.... In other words, you don't really expect a disappearance of bitcoin price overshooting.  I know that you are just making such world view assertions in order to fantasize a little.   

I didn't say anything about 10x two years in a row... and that's not how it works. Do a 10x one year and next one will just implode, as always.

I am referring that I don't expect 5x-10x in a single year.... Which is exactly what I wrote

2x? 3x? Maybe even 4x? Yeah, why not, in a very lucky year... much more than that and there you have another bubble pop and subsequent dump.

But... maybe that's exactly what will happen. Once more. But even if it does, there must be a point in which it doesn't do it anymore. And sooner or later it will come.

I already said I am not expecting (hoping, yes) any more 5x-10x in a single year anymore. In fact I would prefer if we reach the stage in which Bitcoin stops crazily overshooting and overdumping afterwards for a more "sane and healthy" price growth instead.

That'll only happen once BTC's speculative nature has generally been priced in. In other words, in the "late adopter" phase. After mainstream adoption, after dinosaur institutions are balls deep into crypto, etc.

Price and adoption are directly linked, so as long as most people/institutions haven't adopted it yet, it will continue being extremely speculative.

Exponential adoption necessitates exponential gains. The next bubble will melt your face off.

Even if I don't really expect it, I will really welcome it if it does

[bitserve]

Finally broke out of my downward channel lines just now..

End to the bear for a while now?

I would wait till $8.7K (or at least, clearly over $8.5K) to say so. So far so good.

[jojo69]

AYH

Yaaaaaay!

[jojo69]

seems to be hesitating a bit right at the highest possible interpretation of the channel top...

[TheJuice]

seems to be hesitating a bit right at the highest possible interpretation of the channel top...

That channel has been broken. 9k incoming.

[Icygreen]

  Gone fishing for squid with a bamboo stick and a homemade lure. Surfing turquoise waves later while Corns a pumpin'  Its a good day

[jojo69]

seems to be hesitating a bit right at the highest possible interpretation of the channel top...

That channel has been broken. 9k incoming.

I mean, I hope so, but it depends how you draw it, 13880-10313 on a log chart we are juuuust touching it

[jojo69]

yeah

it is not yet our time

[smartcomet]

off topic

i write some thoughts about The Next-Generation Decentralized Social Media

Introduction
The Next-Generation Decentralized Social Media is a decentralized, trustless, uncensored network.

Every user sets a node in local PC, mobile phone, or renting a cloud server for fast connection. There are several Directory Servers in the network which store all users’ public information: IP/domain, name, site etc . A user can follow another user by pull the latter’s IP/Domain from the Directory Server to node.

Every user has a private key and public key pair, the latter is users account number. When a user sends a tweet to the network(actually to followers), must signs it first. One of followers may re-tweet, comment or like the tweet. The user can delete the tweet too, after that a deletion tweet will send to the followers, and quotation of the tweet will be deleted from followers’ node.

[soxxx]

seems to be hesitating a bit right at the highest possible interpretation of the channel top...

The RSI on the daily is at 65, I think we have enough juice left in the tank to break this. Also the break of the pennant has a target of $8700. I think its going to happen.

[heslo]

Well just got home from work and checked the price. Pleasant surprise! Slow and steady hopefully, nothing too enthusiastic just yet

[LUCKMCFLY]

Article that talks about "HOW BITCOIN RESOLVES THE MONETARY MADNESS OF THE GLOBAL CENTRAL BANK".

Global Central Bank Put in one Chart: Central Banks around the world have pumped tons of liquidity into the markets to kill volatility. The People’s Bank of China has expanded its balance sheet the most in the past 15yrs.

Source: https://medium.com/@suncain522/how-bitcoin-solves-global-central-bank-monetary-madness-45a423affdd2

[rdbase]

The pump is real!

Just seen it go from $8365 to $8460 live. It was really a beautiful thing to see.

Is it time for an all nighter to see if it will reach $9k?