Bitcoins at $325 - Prediction Based on Bid/Ask Volume Analysis

[internetguru]

I analyzed the bitcoin level 2 trading data at bitstamps - and I concluded that the bid side market depth for all bids is very low compared to the amount of people on the sell side. The sell side is smart not to fire sale into the bid since they're in no rush to sell. They keep moving their price slowly up to test how much people would want to pay. It's very difficult for the sellers to liquidate. There are a lot of people holding, so it gives the illusion of the rising bitcoin price, but it's actually happening on low volume. I look at the Bid side, and it's so thin down to $260's. Meaning it could flash crash to $260 due to a big unloader. Some guy trying to sell 236 coins at $326 per share. Let's see how badly the bids want those coins and will they move up to meet it? Or will the 236 coin sellers move down to meet the bids?

329 coins at $327 as well - which they may move down if they're desperate. You can watch the live order book and see what they're trying to do.

The slowly rising by $1 at a time or $10 at a time is not a real indicate of its strength and liquidity.

https://www.bitstamp.net/market/order_book/

[Twipple]

Very interesting, I'm sure everyone is anxiously waiting to see what's gonna happen.

[internetguru]

I want to keep this updated to gain other people's insights

[bitwhizz]

nice insight, always good to have two sides

[zuckerant]

It's going down already. I thought that the new high will be around 319 but it got to 329.

Many are expecting a flash crash so why would anybody buy into it?!

The other reason are the bitcoins stuck on gox. They can't be sold there and the money used for arbitration. If you don't know if and when your BTCs and money are sent then why would you buy and send more coins to gox? And the coins sent from gox will be sold on bitstamp. To whom? The bids aren't that good. If you do an instant sell you could lose lots of dollars per bitcoin.

[aminorex]

bitstamp is just one exchange, and not the largest.  the largest is btcchina, where the bid is massive, and the supply is vanishing.  of course it is trivial to move btc from europe to china, so the supply will materialize, but the mid in china is about 5-7% higher than bitstamp and has been for several days. 

what is happening is that wester holders are selling their bitcoin to chinese buyers.  the same thing is happening to gold and silver.  all hard assets, all deflationary assets, are being shifted from europe and the americas into china.  china is taking a long view on these things, and thereby seizing control of much of the global wealth.  this is not a bad thing, since they need to bring so many people up to a higher standard of living.

personally i do not plan on letting my bitcoin go to china in this way.  it may go to china eventually, but it will be under my control.  until the ask is china approaches the side of the bid, i intend to hold and accumulate.

technically, once the wall at 2100 yuan is finally gone, there's nothing to keep the price from going "to the moon" in yuan, except the ability of arbitrageurs to import coin.
they may have practical limitations on usd/cny exchange, due to limited cny liquidity in the offshore market, but i doubt it.  they're probably just milking it for every dime they can.

[meh32123]

That 400 wall at 2100 was a joke, where is the next wall?

[antimattercrusader]

I really wish I had 50k coins chilling in a wallet somewhere. *slaps self*

[Hfertig]

Don´t forget that Bitfinex is connected with Bitstamp. There are USD loans outstanding of USD 3 Mio now (to go BTC leveraged long).  Not sure how many coins that would be, but my guess it is in the range of 10-15.000. With a 50% interest rate per anno, traders will need to liquidate at some stage. A bit of a downmove and we will see margin calls, which are likely to create a spiral. The thin orderbook will just help to drop quicker....

But maybe the chinese will buy up all the coins before that....

[mvidetto]

Pushing $334 atm on coinbase and looks like the price will continue to rise tn.  Mtgox is over $356 and theres still only 7k btc sell orders up atm.

[zuckerant]

Crazy. Woke up 2 hours ago und saw the price at 247. bought in with my last cash in my account after reading about chinese buying coins, sold them after a few minutes at the same price, watched it, bought in again, saw the insane ask/bid-spread (big ask-wall, bids nearly flat), waited and sold again on the downturn. unfortunately it didn't execute my instantsell order the first time or the queue was to long. hat to cancel and redo it. Bought in again, believing in an upturn, but still watching.

spread high-low: $47.83 (347.93 / 300.10)

ps: I'm only a fly on these bid and ask walls.

[internetguru]

Nice, at $1k now