Is market sentiment really driving the price?

[zhangweiwu]

We have been watching market sentiment for a while. I guess we need to include a new factor, the speed of entrance of new investors.

The market price is decided by a few percentage of bitcoin owners who trades. Most bitcoins are sleeping. We used to think market sentiment is decided by these awaken traders.

But, what if the speed of new money coming into the market beats the trader's sentiment? Only a few percent of the new money are traders, just like only a few bitcoin owners trades. Thus, the new money is not influnced by trader's sentiment but they drive the price anyway.

Which is the main drive behind the price?

This perhaps could make a difference between bitcoin market and stock exchange market. The price in the last weeks could be unrelated to market sentiment at all, but by new money. Quesion: do you think the speed of new money coming into the market is changing in the last a few weeks? There are two methods. 1: to check if mtgox deposite is increasing sharply; 2: to analyse blockchain with statistic tools. Now, which one of us are well equiped with these tools? If you don't, then the market sentiment identification would be without a fundation.

Also look at this:

the $80 wall seemed unbreakable, and it vanished just before the price reaches it. The speculators changed their mind and think they can make more profit later. This doesn't look like denial, more like optimism. Also, this wall is made by human traders (a trader bot would choose a value before $80, most likely not a whole number, e.g. $79.1128). Because they are human, not bots, if they decide to cancel their ask order, they must do it in day time, not in sleeping. And where does the sun shine when the $80 wall disappeared? North American was enjoying a high noon. So the $80 wall builders are likely north-americans -- if they are Chinese, they would be sleeping and the next day find their pocket full of money. Needless to say these north-americans needs to be day-traders too, to have reacted in short notice.

So what we believed to be solid $80 wall is built by north-american day-traders. How reliable is that?

I decided to short when the price at the bottom ($68) when I confirmed the market sentiment is going further downwards, and believed a bull-trap shouldn't reach $90. Although I speculate, I am an investor too, I don't want to lose the coins, so, to be on the safe side, I set a trigger to buy back at $81, recognizing the lose in aversion of the risk of mis-identifing a bull trap -- since I don't have a tradebot, I set the trigger in my mind, just look up my mobile phone once in a while. And after a night's good sleep, a warm Chinese morning find the price above $90. Sure I am in-experienced, to rely on a "solid wall" that is broken at the velocity of 1$ per minute (actual measurement), even if I was awak there is no time to react. That motivated me to find who built the wall in the first place. Now we know who built that wall, but we are still oblivious about what is driving the rally. Do you really think it is by denial? I'd like to know why you think so.

P.S. I didn't buy back at $90, instead am waiting for the correction after the rally, and guessing the depth of the correction, but should I expect a strong correction? One lesson learned: if you are a speculator, and you don't live in the same time zone as Americans, you must hire a trading bot and input the strategy before sleeping; and if you do, also hire a trading bot please. Any good opensource bot to suggest?

[1715026078]

1715026078

[1715026078]

1715026078

[magnets99]

would you need a bot?
couldn't you simply place a buy or sell order at you chosen level.
ie it's trading at BTC70, you put a sell order in at US$90
If it goes that high, your order if fulfilled, if not, at the end of the trading day, your order is cancelled.

I might be wrong, i'm not a bitcoin trader but i do trade on the ASX.

[bitcodo]

One lesson learned: if you are a speculator, and you don't live in the same time zone as Americans, you must hire a trading bot and input the strategy before sleeping; and if you do, also hire a trading bot please. Any good opensource bot to suggest?

I was thinking that best way would be, if 2 friends would trade together. One is sleeping, and one trading.  If you are alone, don't sleep enough, you can end up in mental institution.

[zhangweiwu]

would you need a bot?
couldn't you simply place a buy or sell order at you chosen level.

yes you need a bot. You decide to short, so you place an order to buy at $58, for this you don't need a bot.

But you know you could mis-identify the trend, so you also want to place an order to buy at $81, if the price ever break through $80 without hitting $58, --- if when you decide to short the price was $81, then double the reason to do so. But you cannot do it before-hand, that would net you a lot of coins immediately. You only want to place that limited order when the price is near $80, and you need a bot to watch that.

In fact, a shell script (linux) bot less than 10 lines could do that for me. I didn't write on myself -- just didn't realize the $80 wall was so weak, I thought I could see it being hit a few times before breaking.

[Comodore]

Deposits on Gox allowed. New money coming in. We were also oversold before so rebound come at the same time as money form deposit so it was huge. But I did not know about that gox thing so I was not expecting it and made no money at it.

[bitcodo]

Deposits on Gox allowed. New money coming in. We were also oversold before so rebound come at the same time as money form deposit so it was huge. But I did not know about that gox thing so I was not expecting it and made no money at it.

When you could not deposit to gox? They just say, that deposits will take longer. https://support.mtgox.com/entries/21692589-Changes-to-Deposit-Transfer-Procedures

[zhangweiwu]

We were also oversold before so rebound come at the same time as money form deposit so it was huge.

Interesting, thanks for the info:) Who are "We"? I looked up comodore+bitcoin in google and find no business named that. The name sound Latin though.

[bitcodo]

What deposits? Still think this is very bad news, that deposits will take longer time? Maybe gox out of money, using deposits for withdrawals?

EDIT: We, as bitcoin market I guess

[molecular]

would you need a bot?
couldn't you simply place a buy or sell order at you chosen level.

yes you need a bot. You decide to short, so you place an order to buy at $58, for this you don't need a bot.

But you know you could mis-identify the trend, so you also want to place an order to buy at $81, if the price ever break through $80 without hitting $58, --- if when you decide to short the price was $81, then double the reason to do so. But you cannot do it before-hand, that would net you a lot of coins immediately. You only want to place that limited order when the price is near $80, and you need a bot to watch that.

you can use stop order on bitfinex, for example.

[massivebitman]

if you ask me it's got less to do with a change in market sentiment, and more to do with finance in the real world... I'll explain in this thread

https://bitcointalk.org/index.php?topic=254231.0