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

[Fakhoury]

MUST WATCH FOR EVERY CRYPTO ENTHUSIAST WHO WANTS TO KNOW WHERE BITCOIN IS HEADING IN 2017

News URL : https://www.youtube.com/watch?v=HVAI07f-5M0

1 hour video! Is there a section on btc I can skip to?

Start from around the 20th minute.

Clif High is the same oddball prognosticator who predicted nuclear war in 2010. You may as well get investment advice from Rush Limbaugh. Take a look at his website at halfpasthuman.com.

I respect him a lot due to his "unique" way of analysis.

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[eddie13]

If you assume price = constant + superimposed sinusoidal curve, with the amplitude of the curve big enough to trigger buying and selling, then by your method, you repeatedly buy low, sell high, over and over again. Which means you make money, assuming the spread and transaction costs are less than what you earn from buying low and selling high.

Any curve can be represented as a sum of sinusoidal curves, i.e. a Fourier series. Therefore, it becomes mathematically provable that your method, if properly implemented, will cause you to benefit from volatility.

I'd like to see that proof
A couple of problems I see with it:
1) you are talking about piecewise sinusoids (right? reset at each sudden price change?). That complicates any kind of frequency domain analysis. Lots of noise.
2) After a price change, how do you determine what phase (and amplitude) to start the next piece at?

If you really did mean fourier analysis of the whole price data, then you would see low frequency cycles with a bit of luck (but too many people already found those, so they're tiny). The sudden price moves add way too much noise to be able to detect anything sinusoidal at day trader frequencies.

I trade much higher frequency and thrive on the volatility.. I'd say usually 20-100 trades per active trading hour..

I determine where to start the next position 90% based on what is happening in the books..
The books are constantly changing, so I need to get into the rythem of the certin exchange, stare at the books for 10 minutes or so to get a feel for the waves, enter positions when you see the waves in the books coming to push the price buoy back and forth..

I have found on huobi and ok that their are a lot of book "setups" where they try to make you think one thing and then they do the exact opposite..
Like they will put up a sellwall and buy into it themselves right before they dump, you think it's going through the wall and then WHAM they slam it when everyone is buying..

I flip tons of small price movements and try to stay away from longer term "swing" style trading unless the pattern is painfully obvious.. Like last night I went to sleep at abot 4X margin long and was happy this morning.. Made another 10% today in my morning routine trading for the first couple hours when I wake up.. I wake up staring at the books until I see something I have to have and then it's on..  

Also, when I say profits I mean increasing my BTC stash, I could give a crap how much of an alt or fiat I can make but rather just focus on making more BTC..

[European Central Bank]

1 hour video! Is there a section on btc I can skip to?

he's predicting that the chinese government will get hundreds of millions more online this year and wholeheartedly embrace bitcoin at the same time.

uh huh. i won't be betting the farm on that.

[eddie13]

If you assume price = constant + superimposed sinusoidal curve, with the amplitude of the curve big enough to trigger buying and selling, then by your method, you repeatedly buy low, sell high, over and over again. Which means you make money, assuming the spread and transaction costs are less than what you earn from buying low and selling high.

Any curve can be represented as a sum of sinusoidal curves, i.e. a Fourier series. Therefore, it becomes mathematically provable that your method, if properly implemented, will cause you to benefit from volatility.

I'd like to see that proof
A couple of problems I see with it:
1) you are talking about piecewise sinusoids (right? reset at each sudden price change?). That complicates any kind of frequency domain analysis. Lots of noise.
2) After a price change, how do you determine what phase (and amplitude) to start the next piece at?

If you really did mean fourier analysis of the whole price data, then you would see low frequency cycles with a bit of luck (but too many people already found those, so they're tiny). The sudden price moves add way too much noise to be able to detect anything sinusoidal at day trader frequencies.

I think that I understand that your criticism may encapsulate that humans are way too inconsistent in order to make such a system work mathematically as profitable - however, couldn't you program a bot to take out some of the human error and instead of having it set at really close intervals (like they probably do in china with no fees), they set them at intervals like $10 - or maybe more accurately to use percentage moves, like a .5 or 1% move in one direction triggers a sell, and then every equal increment.  Then buy backs would be 1% or more below the sales price.  Of course, there are variations about what increments to use and what quantities.

Percentages would definitely be the way to go, and the optimal percentages would depend on how wide you expect the price fluctuations to be. For example: if you expect LOTS and LOTS of +/- 10% fluctuations, then you're better off buying at the -10% and selling at the +10%. Suppose you model lots of +/- 3% fluctuations with very infrequent +/- 50% fluctuations ... in that case your idealized bot would probably have a pretty complex behavior. Deriving what exactly the ideal bot should do would be a very interesting exercise.

If I were to program a high frequency bot I would program it to use the data of the books/depth and not the charts..
Chart shows the past, maybe can predict longer term trends up to a few hours..
Books show the future..

[JayJuanGee]

Anyone remember which bitcoin price chart had that neat flashing "ATH" symbol when ATH was reached. I wanna make sure i get that experience again.

Either bitcoinwisdom or bitcoinity ...

Bitcoinity does those kinds of things at a variety of important threshold events ..

[abstract1]

Who is leading this 'dump'? It would be nice to see 1000$ hold.

every gesture towards a reversal is failing at the moment.

China too strong.

MRW bears and plebe non-hodlers try to dip BTC down to three digits but fail so hard their efforts are barely noticed:

https://i.sli.mg/kxp6Hr.jpg

[eddie13]

LOL Who sold at the bottom? 

I did prolly 20 times or so but I guess I bought the bottom more often than sold..

[JayJuanGee]

If you assume price = constant + superimposed sinusoidal curve, with the amplitude of the curve big enough to trigger buying and selling, then by your method, you repeatedly buy low, sell high, over and over again. Which means you make money, assuming the spread and transaction costs are less than what you earn from buying low and selling high.

Any curve can be represented as a sum of sinusoidal curves, i.e. a Fourier series. Therefore, it becomes mathematically provable that your method, if properly implemented, will cause you to benefit from volatility.

EDIT:
Actually I might also have to assume that you start and end at the same price. Obviously if the price of bitcoin shoots up to $1M, you're better off if you didn't sell any of it at all during the rise, which means Strategy 1 would be better.

 All trading strategies have a threshold where they stop being profitable. The rebuy approach works best when ranging. It works worst when on a uptrend with no corrections.
 Even if there is retracing, that retracing must match your thresholds. In the worst-case event the corrections can fall just short of your rebuy levels.

 I built a spreadsheet to play around with formalizing these parameters a few years back.
EDIT - Old version:
https://docs.google.com/spreadsheets/d/1jv97ERhahE7pP5xAVIXtHEE89Ew4CHiz7imtwsYw8zg/edit#gid=4 (Make a private copy before entering your own values.)

New version:
https://docs.google.com/spreadsheets/d/1JDYALoV4KR_pvX5vuQww99t4hwqqmuHuAI9CZWhFgt0/edit#gid=0

In the end you are given a list of several points based on math. The variables you control:

 Net worth outside of bit coin, net worth in bitcoin, desired percentage of assets to hold in bit coin,  granularity of sell targets,  percent of funds to use for repurchases, percent correction rebuy target.

 As an example:  John Doe holds 10 bit coins, as a value of $5000 outside of bit coin, wishes to have 66% of his value in bit coin. Sells occur each 20% increase.  Revise occur when each cell target has dropped in value by half.

 This plan would start out balanced as $10,000 in bitcoin value, 5000 outside, matches the 66% balance. As bitch queen goes up you will be forced to sell more to stay to that balance level. Let's say we jump up to $10,000. At that point you would sell your $10,000 target. Now  in the future, that specific cell will only ever be repurchased if you hit $5000 or lower.

This is the key to the rebuy principle. You don't know how deep the corrections will go.
 If it ever only corrected to 6000, you would never revise anything. If it would have corrected to 2500, you could have three but twice as many. You can't to know in advance. So you have to guess on depth.

 Now, the depth of corrections varies in a rally based on how overextended it is.
So I played around with a "heat index " that let the amount that you sold at price targets increase as you deviate farther from moving averages. This lets you sell more when you believe you are overextended, but again there are no guarantees.

 It's a little cryptic to use with no explanation, and it did not have a ton of interest back in the day. I can find a link to the thread that describes it if anyone is interested now.

 Regardless, it is an important topic, and one that is good to have a good plan for, before prices go crazy and emotions can take over. Also crucial is the tax considerations of your buys and sells, long versus short term capital gains, but I am neither a lawyer nor an accountant so that stuff and all formal recommendations are each individual's responsibility.

I believe that I agree with a lot of your principles and your charts seem to contain a lot of the same ideas that I put into practice, which is a combination of selling and rebuying and also considerations regarding taking some of the profits off of the table.


In some sense, your target sell points are way more grand than mine, since I actually started to employ mine at $250 and have been employing them all the way up the price range to today's price with plans to continue to employ the techniques into the future....

So, actually it can be a bit of an unknown whether when you continue to sell on the way up if the price is ever going to return to the lower price points in which you can buy back, and therefore that money would potentially be useable for other purposes, such as direct buying/selling, arbitrage opportunities or maybe just cash flow management.

I think that part of the key, no matter what, is staying cognizant of your accumulation goals and your what kind of proportionality (BTC/fiat percentages) that you would like to have at various price points.

About a year ago, I created a chart like this to give me guidance (and I tweak it from time to time as my thought may change from time to time)


Price                          BTC Allocation
 
$200-350                     97-99.5%
$350-450                     96-99%
$450-550                     92-98%
$550-650                     90-96%
$650-850                     85-94%
$850-1250             84-92%
$1250-2000             83-91%
$2000-3000             82-90%
$3000-5000             55-84%
$5000-10000             50-80%
$10000-20000             48-78%
$20000-30000             45-75%
$30000-50000             43-73%

[sirazimuth]

hey what are the big exchanges these days? i've been primarily watching bitstamp ever since the gox collapse.

Okcoin and Huobi, really. Bitfinex lost a lot of market share after the hack, so there really isn't a dominant USD exchange anymore imo. So it's between finex, stamp, and gdax for usd.

For futures, Okcoin. Bitmex is gaining some popularity. I don't actively watch it right now, but I feel like I will in the future. Need a few more monitors first. And one of those mount thingies to put them above my other monitors lmao.

edits because i'm a drunk asshole

welcome to the club my friend!
nothing like a bit of self-deprecation to introduce oneself eh?  
(ive been known to be a drunk asshole too!)

[JimboToronto]

Another day (UTC), another green candle. Shorter, but green nonetheless.



p.s. Can I be a member of the Drunken Asshole club too?

[HairyMaclairy]

Another day (UTC), another green candle. Shorter, but green nonetheless.

Oh hai must be wake up time in China

[sirazimuth]

Another day (UTC), another green candle. Shorter, but green nonetheless.



p.s. Can I be a member of the Drunken Asshole club too?

absolutely,  it would be an honor sir!  

[r0ach]

Clif High is the same oddball prognosticator who predicted nuclear war in 2010. You may as well get investment advice from Rush Limbaugh. Take a look at his website at halfpasthuman.com.

You forgot the part where he believes the government has captured UFOs and reverse engineers them while creating a breakaway civilization...

He does get some other things right though.

[eddie13]

Winning

[r0ach]

Winning

Windows 10, definitely losing.

[JayJuanGee]

 I built a spreadsheet to play around with formalizing these parameters a few years back.
https://docs.google.com/spreadsheets/d/1jv97ERhahE7pP5xAVIXtHEE89Ew4CHiz7imtwsYw8zg/edit#gid=4 (Make a private copy before entering your own values.)

Cool. I played around with a similar google spreadsheet a while back. Yours looks a whole lot more polished than mine

Mine started out as my own modification of the Sane and Simple Bitcoin Savings Plan. Conceptually, right now, my idea would be to create a bot that does the following: whenever X bitcoin is sold at price P for D dollars, create a list of buy orders spread out over a wide price range which, when totaled, would use the entirety of the D dollars to buy back X + a little extra bitcoin. Example: if the algorithm sells 1 btc at $1000, it automatically places buy orders for $200 worth of bitcoin at prices $900, $800, $700, $600, and $500. If the price falls all the way to $500, then you will have used up the entire $1000 to buy back bitcoin at a cheaper price. You can make it as granular as you think the bot and the system can handle. The interesting problem becomes: what is the ideal way to distribute the buybacks? The answer should be determined by what you expect the volatility to be, so that you can maximize how much you profit from volatility. If there is zero volatility (steady rise to the moon), you're basically just implementing the SSS.

One other thing: whenever you buy bitcoin, your bot should do the same thing in reverse, i.e. it should create a spectrum of price points where you sell it all back, but at higher prices. From an algorithmic standpoint, just flip the BTC/USD pair and treat buying btc as if you are selling USD.

Actually, this is a variation of what I do too, but mine is manually rather than using a bot, and my increments are smaller.  I was thinking that someday, when my portfolio gets further into the green, I will likely cause the ranges (increments) to be a hell-of-a-lot larger in order to not trade smaller swings.  However, I am thinking that currently, I am still in a kind of obsessive accumulation phase and also a kind of preservation of value phase - but if the overall value goes quite a bit more in the green, then there will be less pressure to either accumulate or to preserve value because the whole holdings will be a lot better diversified (or some profits taken off the table and maybe diversified in other assets that will have varying performance expectations.. and maybe even less volatile expectations that compliment expected performance of other assets)...

For example, my thinking has changed a bit when my profits were in the red by 65% in early 2015 and in early 2016, they were kind of floating in the break even territory and today they are floating in a 145% profits territory.  I think that my thinking will also change a little bit (at least get tweaked a bit) if my profits were to go into the 300% territory or even approaching something seemingly outrageous like 1,000% profits.  And, my BTC portfolio and profits level does best if prices are going up; however, the plan also seems to increase profit levels by taking advantage of volatility, so accordingly, profits level can still go up, even if prices do not go up as much as had been expected to achieve a similar level of percentage profits return.

[jbreher]

The Indian government has only 600 tons, but the Indian public has....over 20,000 tons.  

20,000 sounds like a ludicrous overestimation - not that I'd actually know. Where'd you get that figure? Genuinely curious.

Though I personally don't have an issue with the world's 2nd most populous country acquiring sudden boost of relative wealth. Especially as the wealth is held by the people, rather than the government.

[r0ach]

MUST WATCH FOR EVERY CRYPTO ENTHUSIAST WHO WANTS TO KNOW WHERE BITCOIN IS HEADING IN 2017
News URL : https://www.youtube.com/watch?v=HVAI07f-5M0

Just skimmed through it.  He predicts $600/oz silver in 2017, heh.  Didn't see his BTC estimate, just said "higher".

[600watt]

Price                          BTC Allocation
 
$200-350                     97-99.5%
$350-450                     96-99%
$450-550                     92-98%
$550-650                     90-96%
$650-850                     85-94%
$850-1250             84-92%
$1250-2000             83-91%
$2000-3000             82-90%
$3000-5000             55-84%
$5000-10000             50-80%
$10000-20000             48-78%
$20000-30000             45-75%
$30000-50000             43-73%

i like that. ending up with 73% of my stash when btc hits $30000 is hard to achieve, tough. wouldn´t that be a neat thing to have: your funds stay locked until a certain price is hit. kind of russian roulette type of investment strategy (you either win big or lose all), but still...

[JayJuanGee]

i've been away for months dealing with, you know, life. but i've kept an eye on the price.

seems like a steady climb this time, not any sort of real sudden climb. maybe we'll hold it this time.

aug 7th 2016 price $593....dec 19 price $793, a gain of $200 in 131 days, average gain of $1.51 a day over that timespan.

dec 19 2016 price $793....   jan 2nd 2017 price $1030 gain of $237 in 14 days, average gain of  $16.92 a day over that timespan

just sayin....

You are correct, but you can also compare this rise to other rises, and sometimes the upwards momentum becomes unsustainable, which doesn't seem to be happening at the moment.. maybe another $60 or $200 could cause this to be unsustainable or maybe there could be a bit more exponential upwards in the near future.. .2x or 3x or more within a week or two?

none of us really know, but this rise proportionally still seems to have quite a bit of potential legs and support even if it is possible that it could come crashing down at any moment (seemingly less likely scenario)