Why the price panic? (does anyone know anything about the 7th-Aug massive sell?)

[SoggyMoggy]

Just before heading to bed, I checked the price on BritCoin.co.uk...

1BTC = £4  

I was a little shocked as I was expecting to see about £8 as it was about 24 hours ago. I'm now under my break even point for electricity consumption, so I'm considering switching off the miners.

However the drop in price seems to be due to a single (or a small number of) massive sells that moved the market:

http://img263.imageshack.us/img263/7249/07082011014144.png

Uploaded with ImageShack.us

Does anyone know anything about the 7th Aug massive sell off? Was this a single sale or a very small number of massive sales by the same individual or group? If so, why wasn't the dark pool used?

Anyway, my miners have been switched off temporarily to give them a break, at least until the morning when hopefully things will pick up again - they've been running constantly now for well over a month...

[Bitcoinreminder.com]

I think thats because of the bad economics data in usa and eu... And a lot of spaculation...

[ffuentes]

A lot of things converging. Could even be that many of these transactions were actually bitomat and/or mybitcoin money.

I would suggest that this thread goes in Economics.

[Bitcoinreminder.com]

A lot of things converging. Could even be that many of these transactions were actually bitomat and/or mybitcoin money.

bitomat's coins are lost... No hack... Only a lost wallet ^^

[shakaru]

S&P downgraded the US credit rating. Cant figure out why people would pull out from that, then you should not be investing.

[kokojie]

You guys haven't heard? mybitcoin was hacked, tons of coins were stolen. The hacker is unloading them unto the market to cash them out. Plus the #3 exchange supposedly "lost" their wallet that contained their entire btc deposit, if the operator was a liar and actually stole the coins, he's probably unloading them coins as well.

[Tx2000]

It's quite simple, actually.  If you look at the trending in that chart, they people who performed the massive sell-off did so because they had a light bulb go off; that is, if you bring down the brice of Bitcoins to zero, they can get bitcoins for free.

Profit!

[btcLeger]

However the drop in price seems to be due to a single (or a small number of) massive sells

hmmm, doesnt look like. Take a look at the volume by minute. there where plenty of transactions. There was only one huge order of about 27k btc, the others where likely small ones mostly below 2k / minute.

[Beta-coiner1]

S&P downgraded the US credit rating. Cant figure out why people would pull out from that, then you should not be investing.

Hmmm,Would make for a good psych thesis......I call it the lemming theory !!!

[ian209]

I'm not gonna lie, I almost panic sold when I saw the prices dropping.

[Nemesis099]

I'm not gonna lie, I almost panic sold when I saw the prices dropping.

When I saw it dropping I started to put in buy orders and was able to sell when the market went back up.  I have to say this is one thing I love about bitcoins is how much the market moves as someone who watches can buy and sell to make a little extra money.

[mikethebodacious]

Bitcoin had a sell-off on August 7th because it was already looking bearish with it's downward trend, then the US credit downgrade came in and smashed it down further.  As much as us miners love Bitcoin we have to realize there is rampant speculation that gets in and out of a market the second they sense any fear.  Fear in the markets can and will be catastrophic in the years to come as more inevitable credit downgrades come along.  Just think like the smart money does, buy the rumor and sell on the news (get in ahead get out ahead).  The past week has put Bitcoin on track for another rally so just hold onto your coins for now.