.

[adpinbr]

First of all, when do you guys see the dump happening? Secondly both chodpaba and tzupy, you guys are brilliant, I think bitcoin attracts the most intelligent population, and you two defineltey stand out among us. Just wanted to appreciate my gratitude for both profitable and educational posts. Genius. I would love to hear more about your backgrounds if you would be willing to share

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[Tzupy]

Thank you for the kind words, until now when I got close to the truth, I was called 'arrogant' and when I was way off I got called 'clueless'.
And I made many mistakes trading. For instance, after buying at 129.5$, because I expected a new peak, I've set my sell order at 139.95$.
But after seeing a lot of seller pressure, and being unsure if the new peak would be due to the market or the smart whale, I decided to
drop my sell price to 134.95$, just below the 135$ wall. When I noticed the whale buy and rushed to cancel my order, it was too late. Slapped myself.
I pondered for a couple of minutes if I should panic buy at 137$ and sell at about 140$, but when I was about to place my order, I was too late again.

I don't know when the expected big dump will happen. Maybe the smart whale will try another push up in a couple of days, but don't count on it.
If I were that whale I would try to maximize the profits by dumping big when the area ( integral ) local price * local buy sum would be the greatest.
As for my background, I am a graphics programmer, working in security printing, anti-counterfeiting, brand protection, authentication.

[notme]

Thank you for the kind words, until now when I got close to the truth, I was called 'arrogant' and when I was way off I got called 'clueless'.
And I made many mistakes trading. For instance, after buying at 129.5$, because I expected a new peak, I've set my sell order at 139.95$.
But after seeing a lot of seller pressure, and being unsure if the new peak would be due to the market or the smart whale, I decided to
drop my sell price to 134.95$, just below the 135$ wall. When I noticed the whale buy and rushed to cancel my order, it was too late. Slapped myself.
I pondered for a couple of minutes if I should panic buy at 137$ and sell at about 140$, but when I was about to place my order, I was too late again.

I don't know when the expected big dump will happen. Maybe the smart whale will try another push up in a couple of days, but don't count on it.
If I were that whale I would try to maximize the profits by dumping big when the area ( integral ) local price * local buy sum would be the greatest.
As for my background, I am a graphics programmer, working in security printing, anti-counterfeiting, brand protection, authentication.

If you would quit painting yourself into a corner, you could have a plan to react to the moves you previously considered impossible.  This would prevent you from having to rush to adjust.  It's better to make a plan when things are calm, and simply execute when things start moving.  Consider all the possibilities and be ready for anything regardless of what you think is most probable.

[adpinbr]

Thanks for the informative response, I'm an ex soilder now in college, have always been hustling but my first experience making real money was with bitcoin, so I am new (6 months active trading, 2 years in bitcoin). I appreciate your guys help, it's great to see the Wall Street, dog-eat-dog attitude hasn't dominated the bitcoin community yet (maybe I'm being naive). You mind if I ask which sources do you use for your data and calculations? All I am familiar with is Clark moody...

[Tzupy]

@notme: your advice is correct in general, but there are issues with it. I can only react to a developing situation if I am awake.
During the last month several times I wouldn't have been able to execute a plan, because I was still sleeping at 6 am ( my time ).
This time I was surprised to see the whale buy at 6 pm, when I was awake but not expecting it ( not by the whale ).
I should probably try to write a trading bot that would execute specific orders while I am asleep.

@adpinbr: besides clarkmoody ( which sometimes lags ), I look at bitcoinity, bitcoincharts, blockchained and trading.i286 ( doesn't lag much ).

[McGyver]

@notme: your advice is correct in general, but there are issues with it. I can only react to a developing situation if I am awake.
During the last month several times I wouldn't have been able to execute a plan, because I was still sleeping at 6 am ( my time ).
This time I was surprised to see the whale buy at 6 pm, when I was awake but not expecting it ( not by the whale ).
I should probably try to write a trading bot that would execute specific orders while I am asleep.

Whenever I stay with large positions overnight I use http://www.bitcoin-tools.de/ to wake me up in case of any sudden price spike.

Also, when I can't use a separate monitor for a Bitcoin graph (and on a Windows machine), I run Mining explorer as my always-on-top ticker (with refresh rate set to 1 minute).


I consider such spikes at times inconvinient to both US and EU as more than just a coincidence, much in a spirit of Richard Wyckoff's description in his "Day Trader's Bible" (an excellent reading, BTW). In chapter "Trading Rules", on page 19 he wrote (note the fragment that I marked in bold):

A stop order should also be placed if the operator is obliged to live the tape for more than a moment, or if the ticker suddenly is out of order. While he has his eye on the tape the market will tell him what to do. The moment this condition does not exist he must act as he would if temporarily stricken blind - he must protect himself from forces which may attack him in the dark.

I know a trader who once bought 500 shares of Sugar and then went out to lunch. He paid 25 cents for what he ate, but on the returning to the tape he found the total cost of that lunch was $5,000 and 25 cents! He had left no stop order, Sugar went down 10 points, and his broker sent him a margin call.

It's not exactly your situation, but I hope you get my point.

Also beware, this book is so well-written that once you start reading it you won't be able to stop! And you will feel so eager to try all the tricks described.

[McGyver]

Referring to price movement predictions, I believe the following factors get underestimated in most analysis:


1. Buying mining hardware served as a kind of "back door" for the investors to the Bitcoin world until quite recently.

This door is now at least half-closed due to the recent price:diffuculty ratio combined with anticipated further hashing power increases (2PH/s expected from CoinTerra in December, 4PH/s from Bitmine before April 2014, just to name the biggest). Those interested in getting larger quantities of Bitcoins can no longer sneak in by buying mining hardware without the risk of having substatially negative short-term return on their investment. Many may see OTC transactions with a premium as a more sensible alternative and I believe that recent price spikes on exchanges were liquidations of such large OTC buy-ins.


2. Any spikes on Mt.Gox got dismissed as not being genuine and attributed only to investors wanting to escape from Gox.

I get a strong feeling that the price actually "wanted" to go up for some time already, but was constantly suppressed by traders believing in the above. Their misguided resistance could only last for so long (or they would have to have indefinitely deep pockets...) and it seems that this volcano which has been "boiling" underneath for quite some time already is now just about to explode!


3. We just broke the 100 EUR barrier!

Many US-based traders tend to overlook Europe, a second major player in this game and how Bitcoin price tends to bounce off or stick to the round figures in EUR:

ATH being so close to 200 EUR
The biggest (so far) rally had a short-term correction around 100 EUR
May 2013 plateau around 100 EUR

It seems that the mythical "whale" is Euro-based!


4. If the price is only a result of blind market forces then why did it "dance around" such a round figure as 100 USD for so long?

Of course because of human psychology attributting something magical to "double digits", "triple digits", etc. (thinking like: "Ouch, we're back to double digits, so cheap! I must buy!"). This way we got kind of sticky to 100 USD (first on Mt.Gox, later on the other exchanges) and only recently we set ourselves free!

Are we gonna repeat the same exercise with prices denominated in EUR and having 100 EUR as the new strong support level? We shall see it soon...


To follow up with the new custom of introducing our professional backgrounds, I'm a Java EE Developer and a great fan of GNU/Linux with strong interest in financial makrets. My life philosphy is Zen.

[McGyver]

@Tzupy
Don't kid your self more people read than comment [...]

Exactly!

I've been following chodpaba's legendary thread with daily support/resistance charts and the methodology explained (back in 2012) and remember a huge read count of that thread.

[Impaler]

I think we need to start asking ourselves what happens when Gox really runs out of coins because that looks to be on the horizon now.  Will prices go to absurd parabolic and hit new all time highs in a repeat of the April peak which saw BTC availability drop to 25k and then explosively climbed by 150k coins as everyone rushed to sell at the crash?

The media hype and new users just aren't circling this time though, I'd always assumed them to be crucial to blowing up the bubble as classic bubble theory hinges on new buyers bringing in new money that fills the bubble.  Can a few (or maybe one) deep pocketed whale making these blatantly obvious huge buys in a market almost completely devoid of other activity really create a bubble?  If they can then BTC valuation is even more of a farce then I'd thought it was.

I think the key factor that has allowed this new market dynamic is that GPUs are now completely dead for BTC, at around July when we have the last bit of selling pressure from GPU miners the market couldn't take off, now that ASIC's have a monopoly their is no selling pressure at all, the ASIC operators are not operating on narrow margins and can pocket all their production and watch their unrealized 'gains' rise ever higher as prices go to absurdity.

[adamstgBit]

I think we need to start asking ourselves what happens when Gox really runs out of coins

lol this is IMPOSSIBLE!


....

right?

 

[molecular]

Do you believe that we could go parabolic? Another 20k BTC out of the order book could trigger a parabolic rise IMO.
However, I suspect there's a smart whale who just wants the uber-bulls to believe that the market could go parabolic.

Whatever the reasons... Massive it has much more power and you should get in already... I'd like to hear you bull-mode talk.

[rizzla]

Are the bid/ask sums at MtGox on bitcoinity.org real? I'm only seeing around 4kBTC for sale in USD

[Kazu]

IF GOX RUNS OUT OF COINS THE WORLD WILL END.

Or maybe just the gox. But still.

[adamstgBit]

IF GOX RUNS OUT OF COINS THE WORLD WILL END.

Or maybe just the gox. But still.

AHHHHHHHHHHHHHHHHHH

[Wekkel]

If the price is right, more coins will come.

[Odalv]

Looks like Mark Karpeles has made enough money and he has no time(motivation) to grow bussiness. He would make better if he sold MtGox to Coinlab.

[xxjs]

The basic idea of a market is that there will always be some for sale. If there were not, I  might put up a fraction of a coin for sale at 10kUSD/BTC. If I just wanted to know, I could just wait for someone else to do the same.

[Kazu]

By this logic spreads should always be moving outward toward infinity.

[Tzupy]

If the price is right, more coins will come.

I would reformulate this: at the right price, a lot more coins will appear in the order book.
And there is no new fiat entering Gox, together with the suckers who would buy overpriced coins ( this is important ).
On paper, another 1-2 whale buys would deplete the coin reserves, that are visible in the order book.
But I believe there already are about 50k BTC ( or more ) ready to be sold on Gox, mostly in the hands of
bullish whales. They don't show up because the whales know that showing up would badly depress the price.
I imagined a hypothetical situation: the market reaches an ATH of about 300$, but there are
only about 20k BTC buy orders between 150$ and 300$. Who will dump first will make a killing, the rest
will be left behind. And I suspect the first to dump at the top will be the smart whale who starts the whale buys.

[Impaler]

Certainly coins eventually get enticed out with a high enough price, in the last crash 150k coins instantly appeared, all desperate to sell for something remotely close to the 260 high, a similar rush of coins could easily knock price back to double digits because all the coins offered on Gox are just a smidgin of the total supply.  

The coins held by Gox but not actually offered are clearly very very numerous as the speed at which the 150k appeared could only have come from coins already in the Gox system.  So while their were technically only 20k coins offered their were probably 10 times that number 'lurking' and waiting to pounce once it looked like the market had peaked.  That's why the price was unsustainable, it was a lie that their were really only 20k coins available.

When your supply numbers are so manipulated it's so easy to manipulate the market by withdrawing or moving bids.  This is part of why Gox is so BAD as a market, it allows the out right lie of putting out offers that are never intended to be filled and will be retracted as soon as price approaches them, no legitimate market allows this kind of behavior.  If people were allowed to put in only true bids and offers and not retract them or place them at a panic speed then we would not see bubbles grow to this magnitude.

Also I'm not really convinced someone is pumping the market in preparation for a dump (wouldn't be the least surprised if that was the case though), some BTC whale might really think they are becoming 'wealthier' or are even making everyone with BTC wealthier by driving this thing up, people can really be that dump particularly in BTC land.