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

[MAbtc]

This is the disconnect. The very meaning of the words "priced in" indicates "at the present time". If something "will be priced in in the future" then it is, obviously, not priced in currently. I think there is a clear difference between news -- upon which speculators react dynamically -- and future demand spurned by that news over time.

See, then this is pointless. When you ask if something is priced in then all you are asking is "what is the price right now".

No, that's not it. When you ask if something is priced in, you're asking if speculators have acted on it to the extent that they will. If news came out today that Amazon will accept bitcoin, there would be a threshold at which speculators would stop buying based on the perceived future valuation. So if the price jumped from $215 to $600 in two days, you could be fairly sure that the news was being priced into the market to some extent. The full extent is obviously subject to speculation -- and that is specifically the question of whether or not something is "priced in."

By your definition, there is never, ever an answer. Nothing is ever priced in, because we have no idea what future demand looks like. It is much less tangible -- especially because of the multitude of variables and the inability to isolate the effect of any one event on future demand. Perhaps the first reward halving will be "priced in" two years from now. How would we know?

The bitcoin exchange markets are not sophisticated enough or liquid enough to have much "priced in." I would speculate that <5% of any rumor is ever priced in before it is news.

And once it is "news" I think a lot of speculators in bitcoin exchanges are not leading the action, they are following it.  The market is too volatile to try to lead. And most dont have the financial leverage to take those risks. Therefore, if the news generates new money into the markets, there is a delayed effect. That effect is then further "priced in" or "over priced in" once the speculators start following the action.

So, in China, there have been news stories for months. Money finally found its way into the market and started leading. Speculators then drove the price up through the roof.

Bolded does not compute. And we're not talking about rumors, but news. A lack of liquidity does not mean that speculators can't buy or sell based on news.

Who are speculators following? Are they not following other speculators?

I don't think money "finally found" its way to the Chinese market because of news circulating for months... Speculators drove the price up overnight, probably based on Baidu news.

[windjc]

This is the disconnect. The very meaning of the words "priced in" indicates "at the present time". If something "will be priced in in the future" then it is, obviously, not priced in currently. I think there is a clear difference between news -- upon which speculators react dynamically -- and future demand spurned by that news over time.

See, then this is pointless. When you ask if something is priced in then all you are asking is "what is the price right now".

No, that's not it. When you ask if something is priced in, you're asking if speculators have acted on it to the extent that they will. If news came out today that Amazon will accept bitcoin, there would be a threshold at which speculators would stop buying based on the perceived future valuation. So if the price jumped from $215 to $600 in two days, you could be fairly sure that the news was being priced into the market to some extent. The full extent is obviously subject to speculation -- and that is specifically the question of whether or not something is "priced in."

By your definition, there is never, ever an answer. Nothing is ever priced in, because we have no idea what future demand looks like. It is much less tangible -- especially because of the multitude of variables and the inability to isolate the effect of any one event on future demand. Perhaps the first reward halving will be "priced in" two years from now. How would we know?

The bitcoin exchange markets are not sophisticated enough or liquid enough to have much "priced in." I would speculate that <5% of any rumor is ever priced in before it is news.

And once it is "news" I think a lot of speculators in bitcoin exchanges are not leading the action, they are following it.  The market is too volatile to try to lead. And most dont have the financial leverage to take those risks. Therefore, if the news generates new money into the markets, there is a delayed effect. That effect is then further "priced in" or "over priced in" once the speculators start following the action.

So, in China, there have been news stories for months. Money finally found its way into the market and started leading. Speculators then drove the price up through the roof.

Bolded does not compute. And we're not talking about rumors, but news. A lack of liquidity does not mean that speculators can't buy or sell based on news.

Who are speculators following? Are they not following other speculators?

I don't think money "finally found" its way to the Chinese market because of news circulating for months... Speculators drove the price up overnight, probably based on Baidu news.

No, you are wrong. News may drive new money to the markets. There is a delayed effect. Speculators follow the moves that new money makes.

The only time speculators drive the markets is in flash crashed and panic sells. Some of them get out so they can try to buy back lower and some of them just panic.

But upward sustained motion is not led by speculation. Its lead by new money. The April rally was lead by new money. It was sent into the stratosphere by speculation.

Plus, the fact that you don't think the ability for a market to "buy the rumor sell the news" is not an indicator of speculators driving day to day prices, shows what you are missing about these markets. You need to do some day trading for a couple for years on the Nasdaq and come back and have this conversation again.

[DougTanner]

Canada finally hit $200 (I helped ). Gox and Bitstamp heading slowly upwards.

[adamstgBit]

Canada finally hit $200 (I helped ).

damn i'm late... should i try to catch the next knife?? should i just send all in now and hit market buy ASAP? omg omg omg NOOoooooooooooooooooooooooooooooooooooooooooo

lol

Bitcoin!

[Adrian-x]

Really? You think when (if) BTC gets to 4 figures that people are going to be excited to buy them? You think your grandma will want to invest in BTC if a bitcoin costs $1500? You think people will pyschologically want to buy a bitcoin when its priced higher than an .oz of GOLD?

Why on earth do you think large growing companies SPLIT their stocks? Is this is not obvious to you?

People are not sophisticated. Thats why everything always forever is on sale! Oh, look this t-shirt was $69, but today only it's $19. That is the world we live in.

BTC will become psychologically too expensive one day. And mBTC will HAVE to be the denomination of the exchanges. And what I am referring to is the psychological barrier for BTC becoming an "Asset class investment."

I agree with your sentiment, but I thought it was psychologically too expensive @ $13, and thought Dollar parody was probably the best price to accelerate adoption.  On that point  Satoshi himself didn't have denominations for the lower values, he just thought it would always be called Bitcoin and you would move the decimal point as the value increased.  

Turns out I was wrong and it didn't work out the way Satoshi thought, but oh well the not sophisticated people can use fiat, and get those discounts the sophisticated ones can get over the rising price and benefit from Bitcoin, the age of ignorance is coming to an end.  

[SheHadMANHands]

Really? You think when (if) BTC gets to 4 figures that people are going to be excited to buy them? You think your grandma will want to invest in BTC if a bitcoin costs $1500? You think people will pyschologically want to buy a bitcoin when its priced higher than an .oz of GOLD?

Why on earth do you think large growing companies SPLIT their stocks? Is this is not obvious to you?

People are not sophisticated. Thats why everything always forever is on sale! Oh, look this t-shirt was $69, but today only it's $19. That is the world we live in.

BTC will become psychologically too expensive one day. And mBTC will HAVE to be the denomination of the exchanges. And what I am referring to is the psychological barrier for BTC becoming an "Asset class investment."

I agree with your sentiment, but I thought it was psychologically too expensive @ $13, and thought Dollar parody was probably the best price to accelerate adoption.  On that point  Satoshi himself didn't have denominations for the lower values, he just thought it would always be called Bitcoin and you would move the decimal point as the value increased.  

Turns out I was wrong and it didn't work out the way Satoshi thought, but oh well the not sophisticated people can use fiat, and get those discounts the sophisticated ones can get over the rising price and benefit from Bitcoin, the age of ignorance is coming to an end.  

Berkshire Hathaway appears to be doing fine at ~$180,000 /share

[adamstgBit]

Canada finally hit $200 (I helped ).

damn i'm late... should i try to catch the next knife?? should i just send all in now and hit market buy ASAP? omg omg omg NOOoooooooooooooooooooooooooooooooooooooooooo

lol

Bitcoin!

seriously tho i want to make a purchase... but price is nearly parabolic, but we can fly high once we break ATH... not sure what to do...

we should petition the FBI to sell some of their holdings on virtex too, give some love to their Canadian neighbors ah!

[MAbtc]

This is the disconnect. The very meaning of the words "priced in" indicates "at the present time". If something "will be priced in in the future" then it is, obviously, not priced in currently. I think there is a clear difference between news -- upon which speculators react dynamically -- and future demand spurned by that news over time.

See, then this is pointless. When you ask if something is priced in then all you are asking is "what is the price right now".

No, that's not it. When you ask if something is priced in, you're asking if speculators have acted on it to the extent that they will. If news came out today that Amazon will accept bitcoin, there would be a threshold at which speculators would stop buying based on the perceived future valuation. So if the price jumped from $215 to $600 in two days, you could be fairly sure that the news was being priced into the market to some extent. The full extent is obviously subject to speculation -- and that is specifically the question of whether or not something is "priced in."

By your definition, there is never, ever an answer. Nothing is ever priced in, because we have no idea what future demand looks like. It is much less tangible -- especially because of the multitude of variables and the inability to isolate the effect of any one event on future demand. Perhaps the first reward halving will be "priced in" two years from now. How would we know?

The bitcoin exchange markets are not sophisticated enough or liquid enough to have much "priced in." I would speculate that <5% of any rumor is ever priced in before it is news.

And once it is "news" I think a lot of speculators in bitcoin exchanges are not leading the action, they are following it.  The market is too volatile to try to lead. And most dont have the financial leverage to take those risks. Therefore, if the news generates new money into the markets, there is a delayed effect. That effect is then further "priced in" or "over priced in" once the speculators start following the action.

So, in China, there have been news stories for months. Money finally found its way into the market and started leading. Speculators then drove the price up through the roof.

Bolded does not compute. And we're not talking about rumors, but news. A lack of liquidity does not mean that speculators can't buy or sell based on news.

Who are speculators following? Are they not following other speculators?

I don't think money "finally found" its way to the Chinese market because of news circulating for months... Speculators drove the price up overnight, probably based on Baidu news.

No, you are wrong. News may drive new money to the markets. There is a delayed effect. Speculators follow the moves that new money makes.

The only time speculators drive the markets is in flash crashed and panic sells. Some of them get out so they can try to buy back lower and some of them just panic.

But upward sustained motion is not led by speculation. Its lead by new money. The April rally was lead by new money. It was sent into the stratosphere by speculation.

Plus, the fact that you don't think the ability for a market to "buy the rumor sell the news" is not an indicator of speculators driving day to day prices, shows what you are missing about these markets. You need to do some day trading for a couple for years on the Nasdaq and come back and have this conversation again.

You haven't explain how I am wrong. I never said news doesn't drive money to markets. I am saying there is a distinction between the long term effect on demand and the short to mid term effect of speculators trading on said news.

Keep thinking speculators have nothing to do with markets outside of panic selling. How would you have any idea whether it's "new money" or money that has been sitting on the exchanges? And I said nothing remotely close to the notion that news/exposure doesn't bring new money.

I don't see how one can separate speculators from the equation. They speculate on the prospect of new money coming in. Speculators are the ones who have provided the liquidity and have money on exchanges to drive the price up in the first palce. The "new blood" will continue buying at the top, indeed, and will be crushed when the market turns.

And honestly, blurting out a slogan like "buy the rumor sell the news" is simply ridiculous and completely irrelevant. What are you even talking about? Can you explain to me what you're saying, in the context of what I said?

[SheHadMANHands]

"Priced In" Example

What if you just focused in on (1) typical speculator, for simplicity.  This speculator is speculating on the value of Bitcoin.  Like any speculator, he has a finite amount of fiat money he is willing to invest, even when he's most bullish.  We'll say this amount is $1,000.

Say that typically he holds 50/50 of that $1000 between fiat and Bitcoin.  When he feels more bullish, he invests heavier in Bitcoin.  When he feels bearish, he invests heavier in fiat.  But he has a finite amount that he'll invest.  At maximum "bullishness", he pushes all $1000 into Bitcoin.

Let's assume news comes out that is very bullish in nature, and our speculator invests the full $1000 in Bitcoin.  Perhaps other speculators do similar.  This does not undermine the fact that "new money" may now enter the "speculation pool".  This "new money" has no option but to invest in Bitcoin, as obviously the "new money" has no Bitcoin yet to sell.  Increased demand > Increased price.

Is the initial "speculation pool", prior to the introduction of "new money", not similarly restricted to the finite fiat it can invest?  How can a small, limited speculation pool fully "price in" new money, when they have a limited amount they will ever invest (and may already be fully leveraged)?

It seems to me "new money" might induce bubbles, where prior speculators, in particular, choose to sell out.  It doesn't seem apparent to me that "new money" can be completely priced in, in a relatively small speculation pool with limited resources.

Point: A relatively small speculation pool (Bitcoin speculators) can not fully "price in" any amount of incoming new money before it arrives.  Their resources to do so are severely restricted by the size of the pool.

[JimboToronto]

Maybe it is and always was a fake/manipulator-controlled pump.

No. It was a fake/manipulator-controlled dump that took us from 230+ down to 175 last week. Of course the market rejected it (except for a few foolish bears who were shorn like sheep) and here we are back to the relentless push upwards.

[windjc]

This is the disconnect. The very meaning of the words "priced in" indicates "at the present time". If something "will be priced in in the future" then it is, obviously, not priced in currently. I think there is a clear difference between news -- upon which speculators react dynamically -- and future demand spurned by that news over time.

See, then this is pointless. When you ask if something is priced in then all you are asking is "what is the price right now".

No, that's not it. When you ask if something is priced in, you're asking if speculators have acted on it to the extent that they will. If news came out today that Amazon will accept bitcoin, there would be a threshold at which speculators would stop buying based on the perceived future valuation. So if the price jumped from $215 to $600 in two days, you could be fairly sure that the news was being priced into the market to some extent. The full extent is obviously subject to speculation -- and that is specifically the question of whether or not something is "priced in."

By your definition, there is never, ever an answer. Nothing is ever priced in, because we have no idea what future demand looks like. It is much less tangible -- especially because of the multitude of variables and the inability to isolate the effect of any one event on future demand. Perhaps the first reward halving will be "priced in" two years from now. How would we know?

The bitcoin exchange markets are not sophisticated enough or liquid enough to have much "priced in." I would speculate that <5% of any rumor is ever priced in before it is news.

And once it is "news" I think a lot of speculators in bitcoin exchanges are not leading the action, they are following it.  The market is too volatile to try to lead. And most dont have the financial leverage to take those risks. Therefore, if the news generates new money into the markets, there is a delayed effect. That effect is then further "priced in" or "over priced in" once the speculators start following the action.

So, in China, there have been news stories for months. Money finally found its way into the market and started leading. Speculators then drove the price up through the roof.

Bolded does not compute. And we're not talking about rumors, but news. A lack of liquidity does not mean that speculators can't buy or sell based on news.

Who are speculators following? Are they not following other speculators?

I don't think money "finally found" its way to the Chinese market because of news circulating for months... Speculators drove the price up overnight, probably based on Baidu news.

No, you are wrong. News may drive new money to the markets. There is a delayed effect. Speculators follow the moves that new money makes.

The only time speculators drive the markets is in flash crashed and panic sells. Some of them get out so they can try to buy back lower and some of them just panic.

But upward sustained motion is not led by speculation. Its lead by new money. The April rally was lead by new money. It was sent into the stratosphere by speculation.

Plus, the fact that you don't think the ability for a market to "buy the rumor sell the news" is not an indicator of speculators driving day to day prices, shows what you are missing about these markets. You need to do some day trading for a couple for years on the Nasdaq and come back and have this conversation again.

You haven't explain how I am wrong. I never said news doesn't drive money to markets. I am saying there is a distinction between the long term effect on demand and the short to mid term effect of speculators trading on said news.

Keep thinking speculators have nothing to do with markets outside of panic selling. How would you have any idea whether it's "new money" or money that has been sitting on the exchanges? And I said nothing remotely close to the notion that news/exposure doesn't bring new money.

I don't see how one can separate speculators from the equation. They speculate on the prospect of new money coming in. Speculators are the ones who have provided the liquidity and have money on exchanges to drive the price up in the first palce. The "new blood" will continue buying at the top, indeed, and will be crushed when the market turns.

And honestly, blurting out a slogan like "buy the rumor sell the news" is simply ridiculous and completely irrelevant. What are you even talking about? Can you explain to me what you're saying, in the context of what I said?

Ok, look, I don't think we disagree on everything. And I think some of it might be semantics. When I think of speculators, I think of day traders - active speculators. Not speculators in the sense of intermediate term players.

There is a term called smart money. Smart money can mean the market makers, which only today has an enchange opened that gave people the ability to be market makers (UK exchange). Smart money can also be seasoned or "inside information" traders. Often these traders take advantage of trends, including a popular one, which involves buying into a rumor of potential good news forth coming. This basically "prices in" the news, whether the news comes or not. So by the time the news arrives (or doesnt) the smart money is out and the stock flatlines or goes down.

Most people just read the news and react.

And that is just one common scenario in a seasoned market.

I just do not see these types of plays being done in the BTC market. I mean, its pretty obvious that alot of BTC day traders (what I am referring to as speculators) are not seasoned traders. Just read the hundreds of threads and posts about "whales" and "market manipulation" and "Gox theories of trapped coins" and "what dump caused the last flash crash" and "when will we be at 10k".  These people are following trends not setting them.

The market is going up because more money is coming into it. Thats the only reason. And, in my opinion, most of that new money is not from day traders.

[wachtwoord]

Point: Small speculation pool (Bitcoin speculators) can not fully "price in" any amount of incoming new money before it arrives.  Their resources to do so are severely restricted by the size of the pool.

Probably true, but isn't there where leverage comes in? Or is the volume of that still too low?

[SheHadMANHands]

Point: Small speculation pool (Bitcoin speculators) can not fully "price in" any amount of incoming new money before it arrives.  Their resources to do so are severely restricted by the size of the pool.

Probably true, but isn't there where leverage comes in? Or is the volume of that still too low?

I think it could be.  But there is only one place, to my knowledge, where you can take a leveraged position on Bitcoin currently.  That's Bitfinex.  Two points there:

(1) Bitfinex has a limited amount of fiat loans available, due to it's size, and they dry up very quickly in any bullish market.
(2) Not every speculator (or even most) are willing to increase their risk further via long/short positions, especially when APRs are high.  The variance in BTC price alone is often high enough for the money they're willing to risk.

[Richy_T]

This is the disconnect. The very meaning of the words "priced in" indicates "at the present time". If something "will be priced in in the future" then it is, obviously, not priced in currently. I think there is a clear difference between news -- upon which speculators react dynamically -- and future demand spurned by that news over time.

See, then this is pointless. When you ask if something is priced in then all you are asking is "what is the price right now".  It is not the definition that I would accept because I like to think people ask questions for a reason and like their indicators to actually indicate something.

"Priced in" is also evocative of some kind of group think. Different people will have different ideas of value. All the current price tells you is where people of a similar mind are trading at.

[wachtwoord]

BTW: Let me please state that imo the perfect market theory that the market always has everything is priced in is nonsense, also in very mature markets such as the NYSE and NASDAQ.

Mr. Market, like bitches, is crazy!

[ChartBuddy]

[JimboToronto]

Canada finally hit $200 (I helped ).

damn i'm late... should i try to catch the next knife?? should i just send all in now and hit market buy ASAP? omg omg omg NOOoooooooooooooooooooooooooooooooooooooooooo

lol

Bitcoin!

seriously tho i want to make a purchase... but price is nearly parabolic, but we can fly high once we break ATH... not sure what to do...

we should petition the FBI to sell some of their holdings on virtex too, give some love to their Canadian neighbors ah!

Damn I hate the new Virtex deposit policy. Last spring if I had my anonymous cash deposits at my choice of banks by 5:00PM, the funds would be in my account in less than an hour and a half, ready for trading. Waiting days is excruciating and runs contrary to everything Bitcoin stands for.

If the price of bitcoins rises from $180 to over $300 while I'm waiting to get a $10k cheque into my Virtex account, I'll be really pist. I thought I was gonna get at least 50 coins.

[byronbb]

Point: Small speculation pool (Bitcoin speculators) can not fully "price in" any amount of incoming new money before it arrives.  Their resources to do so are severely restricted by the size of the pool.

Probably true, but isn't there where leverage comes in? Or is the volume of that still too low?

I think it could be.  But there is only one place, to my knowledge, where you can take a leveraged position on Bitcoin currently.  That's Bitfinex.  Two points there:

1broker.com takes btc leverage 5:1 while plus500 and avatrade both deal leveraged bitcoin CDFs in fiat.

[adamstgBit]

Canada finally hit $200 (I helped ).

damn i'm late... should i try to catch the next knife?? should i just send all in now and hit market buy ASAP? omg omg omg NOOoooooooooooooooooooooooooooooooooooooooooo

lol

Bitcoin!

seriously tho i want to make a purchase... but price is nearly parabolic, but we can fly high once we break ATH... not sure what to do...

we should petition the FBI to sell some of their holdings on virtex too, give some love to their Canadian neighbors ah!

Damn I hate the new Virtex deposit policy. Last spring if I had my anonymous cash deposits at my choice of banks by 5:00PM, the funds would be in my account in less than an hour and a half, ready for trading. Waiting days is excruciating and runs contrary to everything Bitcoin stands for.

If the price of bitcoins rises from $180 to over $300 while I'm waiting to get a $10k cheque into my Virtex account, I'll be really pist. I thought I was gonna get at least 50 coins.

I remember the good old days too
I need to send my contribution for the year and look at the price lol!
I really should be cashing out... but i DID cash out profits b4 at 26... i just want to buy, can the FBI drop its kinfe of death already! lol
I guess thats the position i'll take, i'll make sure to have my fait ready when FBI sells  

[Richy_T]

When the FBI sells, that should be a nice bit of publicity for Bitcoin. Potentially bullish.

If it goes to auction, as I believe, I would think the top bidder would likely be someone who sees the potential of Bitcoin so they are more likely to hold than dump.