Rally from $500 happened on very low volume, crash looming?

[oda.krell]

Didn't want to sound too hash, I like your new serious style. Plus, we're going into a correction (how small or big unclear yet), so you're not entirely wrong.

One thing though I forgot in my earlier post.

This was not the point. The point was to show that there is markedly less volume in higher prices, compared to lower. It is not the same thing as higher volume over time. The point was to visualize (e.g.) that if only 2% of coins have been traded at over $700, the price level is not yet very established, and will not be supported by buyers if the selling intensifies.

Right. After posting my critical remarks I realized I didn't address your main point (about the uneven volume distribution across prices). Then I thought of a brilliant answer for that point, but was too tired to post and went to bed instead

So here it goes, with a bit of delay: I don't think that part holds up very well. I'm pretty sure that you just describe what is basically a "natural" distribution (of volume) that thins out as you get to fringes of the price.

In other words: the time interval you picked contained prices from 200 to 1200. The lowest point isn't a fringe point, because you cut off trading history before that price. So we've traded around 200 much longer. Same for everything in between 200 and 1200. The further you go away from the middle though, the lower the volume gets, as is to be expected since 1200 was the ATH at that point.

I guess to really make my point I'd have to do a quick history analysis myself. I'll see if I have time for it tonight. But my basic claim would be: If you take *any* time interval where the beginning point is at a price that has been traded regularly before, and the ending point is near the ATH (up the end of that period), then volume will thin out getting closer to that ATH.

If that's true, then the point would be then that you can't really conclude from volume thinning out as you get near the then-ATH that we've reached the end of a rally... Usually, on the way to the "final" ATH of a rally, several smaller ATHs are broken in the meantime, without a major interruption of the rally (see Januar to April this year for an example)

[BitchicksHusband]

Was that $200 last night a correction or the crash?  I believe that crashes will become less and less intense the more people involved in bitcoin, so I wouldn't expect to see much more than that at this point.

[Carra23]

Was that $200 last night a correction or the crash?  I believe that crashes will become less and less intense the more people involved in bitcoin, so I wouldn't expect to see much more than that at this point.

Do not be too sure. The crash will end up happening when almost everyone is convinced it is bulletproof.

No idea if this is the crash, does not feel like till now. There will be a crash sooner or later, but may be from $2000 to $1000, or right now till $400.

[rpietila]

Was that $200 last night a correction or the crash?  I believe that crashes will become less and less intense the more people involved in bitcoin, so I wouldn't expect to see much more than that at this point.

If $200 is the maximum downside, why is not all the money in the world buying bitcoins just now, and why is anyone selling at any price? 

I believe we will see -75% crash again. The one 2 weeks back was -50%.

[BitchicksHusband]

why is not all the money in the world buying bitcoins just now, and why is anyone selling at any price?

This is the question I keep asking myself every day, and yet here we are.

[crazy_rabbit]

The best time for a crash is sunday night. Nothing better then waking up Monday morning with fresh fiat and cheap coins.

[MatTheCat]

Data used: Bitstamp's hourly volume weighted average historical trades Nov 1, 00:00 - Nov 30, 09:00.

Total volume during that period: BTC953,782.

Code:

price        volume     mid point    BTC      $m
$200-299     BTC215,619 $250.00   215619 $53.90
$300-399     BTC208,384 $350.00   208384 $72.93
$400-499     BTC135,057 $450.00   135057 $60.78
$500-599     BTC98,430  $550.00    98430 $54.14
$600-699     BTC86,344  $650.00    86344 $56.12
$700-799     BTC46,202  $750.00    46202 $34.65
$800-899     BTC73,779  $850.00    73779 $62.71
$900-999     BTC47,990  $950.00    47990 $45.59
$1000-1099   BTC36,849  $1050.00   36849 $38.69
$1100-1199   BTC5,127   $1150.00    5127  $5.90

During November, 59% of the trades (by BTC volume) happened at prices lower than $500. Conversely, only 9% happened on $900 or higher. The average price for all trades was $517.

Followed this and read through much of the thread, with all the usual derision coming from the perma-bulls whose opinions are based on nothing more than wish fulfilment.

It seems that just one day later, your prediction has come to light. Perhaps not a mega-crash, but certainly a brutal correction that nobody wants to be standing on the wrong side off.

Interesting to see a forecast on these pages based on actual numbers and trends, as opposed to fantasies of avarice or sour grapes of having missed the boat. Where is there public access to those figures that you have posted?

[windjc]

Data used: Bitstamp's hourly volume weighted average historical trades Nov 1, 00:00 - Nov 30, 09:00.

Total volume during that period: BTC953,782.

Code:

price        volume     mid point    BTC      $m
$200-299     BTC215,619 $250.00   215619 $53.90
$300-399     BTC208,384 $350.00   208384 $72.93
$400-499     BTC135,057 $450.00   135057 $60.78
$500-599     BTC98,430  $550.00    98430 $54.14
$600-699     BTC86,344  $650.00    86344 $56.12
$700-799     BTC46,202  $750.00    46202 $34.65
$800-899     BTC73,779  $850.00    73779 $62.71
$900-999     BTC47,990  $950.00    47990 $45.59
$1000-1099   BTC36,849  $1050.00   36849 $38.69
$1100-1199   BTC5,127   $1150.00    5127  $5.90

During November, 59% of the trades (by BTC volume) happened at prices lower than $500. Conversely, only 9% happened on $900 or higher. The average price for all trades was $517.

Followed this and read through much of the thread, with all the usual derision coming from the perma-bulls whose opinions are based on nothing more than wish fulfilment.

It seems that just one day later, your prediction has come to light. Perhaps not a mega-crash, but certainly a brutal correction that nobody wants to be standing on the wrong side off.

Interesting to see a forecast on these pages based on actual numbers and trends, as opposed to fantasies of avarice or sour grapes of having missed the boat. Where is there public access to those figures that you have posted?

Buy and hold strategy does not lend itself to "standing on the wrong side of a brutal correction."

Rptelia got this correction correct. Hats off to him. It was a unique one, a trickle that turned into a stream. Lot of nerves and selling pressure coupled with no new money on the weekend. I'll be the first to say that this might have follow through, although I'll be surprised if we go below 5000 CYN and 700-750 on Gox.

Does it feel like doom and gloom to you?  All I see is good news in the media (one of the #1 reasons have been such a bull) and less and less panic in the streets when the market goes down. In fact, people seemed to watch today with amusement instead of fear.

That being said, there seems to be a lack of confidence at these altitudes and maybe bitcoin has run it's course in this rally.

Or maybe we will be back near the top in a day or two.

[wobber]

so, have you sold some BTC, rpietilla?

[rpietila]

Data used: Bitstamp's hourly volume weighted average historical trades Nov 1, 00:00 - Nov 30, 09:00.

Total volume during that period: BTC953,782.

During November, 59% of the trades (by BTC volume) happened at prices lower than $500. Conversely, only 9% happened on $900 or higher. The average price for all trades was $517.

Followed this and read through much of the thread, with all the usual derision coming from the perma-bulls whose opinions are based on nothing more than wish fulfilment.

It seems that just one day later, your prediction has come to light. Perhaps not a mega-crash, but certainly a brutal correction that nobody wants to be standing on the wrong side off.

Interesting to see a forecast on these pages based on actual numbers and trends, as opposed to fantasies of avarice or sour grapes of having missed the boat. Where is there public access to those figures that you have posted?

Buy and hold strategy does not lend itself to "standing on the wrong side of a brutal correction."

Rptelia got this correction correct. Hats off to him. It was a unique one, a trickle that turned into a stream. Lot of nerves and selling pressure coupled with no new money on the weekend. I'll be the first to say that this might have follow through, although I'll be surprised if we go below 5000 CYN and 700-750 on Gox.

Does it feel like doom and gloom to you?  All I see is good news in the media (one of the #1 reasons have been such a bull) and less and less panic in the streets when the market goes down. In fact, people seemed to watch today with amusement instead of fear.

That being said, there seems to be a lack of confidence at these altitudes and maybe bitcoin has run it's course in this rally.

Or maybe we will be back near the top in a day or two.

I have to say that I don't know where the exchange rate is going. Every day above $1,000 strengthens that as a new base, and:

1. We might have a period of relative stability for days, weeks or even many weeks (see 2010: fast runups followed by plateaus).

2. We can also go overdrive, followed by the real crash.

3. If we go south from here, there seems to be a lot of support and $500 can only be achieved by not letting buy orders in while enabling sell orders (an insidious trick from Mt.Gox in April 12). Not breaking the weekend low ($800) is a sign on confidence, otoh breaking it can lead to flashcrash towards $700 but hardly lower since the exchanges are full of fiat.

This is different than a blowoff top scenario (numbered #2 above), where price rises faster than new fiat can be pumped in to the exchanges and when the crash comes, all fiat in the exchanges belongs to the sellers who are unwilling to buy except at much lowered prices.

Can't give any percentages right now 

All figures can be downloaded from Bitcoincharts.

so, have you sold some BTC, rpietilla?

During the flashcrash, I net increased my BTC position by about 80,000mBTC. Still well prepared to any scenario. (Is there anyone else that handles position management professionally/systematically (as opposed to feeling-based)?)

Also I increased my total position by abt 15,000mBTC, learning how to arbitrage. I am getting better at it. Roni is having a work trip in China/Thailand so I handle the desk myself. Now I am also in the position to buy/sell large amounts internationally with hefty commissions to those who do not trust or cannot use exchanges. Customer sends first. $50k/BTC50 min.

[traderCJ]

Oh brother.  The "correction" on Sunday was orchestrated.  Whales dumped, that bogus list of addresses was released, bitcointalk was hacked so people couldn't get a reality check, weak hands saw the tickers bleeding red, and panic sold.  I don't think it was anything more than that.  Of course, these events spook the market and we'll probably be parked in this range for a week or so.  Like it or not, ALL investments are at the whims of mass psychology, especially with an instrument like this which evades normal pricing models.  Whenever someone says they're sure something is about to happen in this market, I know they're full of it.  Unless you're the whale making the dumps, a hacker about to raise hell or working for an exchange and can see the $ moving in and out you're guessing like everyone else.  The worst thing someone can do is attribute luck to skill.  Most of the people here who have made it big did so by offering bitcoin-related services and buying + holding, certainly not from accurate speculation from what I can tell.

[bitleif]

Oh brother.  The "correction" on Sunday was orchestrated.  Whales dumped, that bogus list of addresses was released, bitcointalk was hacked so people couldn't get a reality check, weak hands saw the tickers bleeding red, and panic sold.

Ok, do you have ANYTHING to back that up? Bitcointalk seems more likely to have gone down due to excessive traffic, which wouldn't be strange in a panic sellout. And the "bogus list" was obviously a joke. This post just seems overly paranoid to me.

[piramida]

bitcointalk was hacked, paswords leaked, as was confirmed by bitcointalk itself. also gox down due to excessive traffic or ddos, and most tickers down / overloaded. it did seem orchestrated.

traderCJ, speculation though is really easy once you get used to peculiarities. For one, market is in a constant uptrend, so you just have some orders ready to pick up corrections, and sell a little at local tops. As for predicting where the price would go today, good luck with that in any market.

[rpietila]

Important thing is that it refused to be pricked, and bounced straight back from $800 (bitstamp), which has become a strong support. The probability that it will be breached (for anything more but a flashcrash, maximum) has strongly diminished.

Gox also held well.

But who had a look at BTC China? It refused to be manipulated at all! The spread between China and Bitstamp went to +20% due to stamp crashing, whereas both the day before and after it was close to 0%. China is providing so immense liquidity that it has changed the game totally.

The weekend was the best opportunity for taking the price down, and all tricks were pulled, but it seems to have just proven that the $1,000 level is legitimate. It is a nice, round figure, and fundamentals and exponential trends are soon catching it. The lacking volume in these prices, which was my concern, and the topic of this thread, has feen fulfilled.

I am sorry if my bearish call in Nov 19 was misinterpreted as an exhortation to sell all, or even half of anyone's holdings. With bitcoin, most of the holdings should be in cold storage and the rest diversified to other forms of wealth according to a predetermined plan, for example the SSS plan.

[Salivan]

market is strong at  this  point I feel it, much stronger than back than in 800 range.
Tomorrow rally 10-20%

if not I am selling some, cause I am getting out of touch

[User705]

Important thing is that it refused to be pricked, and bounced straight back from $800 (bitstamp), which has become a strong support. The probability that it will be breached (for anything more but a flashcrash, maximum) has strongly diminished.

Gox also held well.

But who had a look at BTC China? It refused to be manipulated at all! The spread between China and Bitstamp went to +20% due to stamp crashing, whereas both the day before and after it was close to 0%. China is providing so immense liquidity that it has changed the game totally.

The weekend was the best opportunity for taking the price down, and all tricks were pulled, but it seems to have just proven that the $1,000 level is legitimate. It is a nice, round figure, and fundamentals and exponential trends are soon catching it. The lacking volume in these prices, which was my concern, and the topic of this thread, has feen fulfilled.

I am sorry if my bearish call in Nov 19 was misinterpreted as an exhortation to sell all, or even half of anyone's holdings. With bitcoin, most of the holdings should be in cold storage and the rest diversified to other forms of wealth according to a predetermined plan, for example the SSS plan.

That's probably because China doesn't read these forums.

[Odalv]

Important thing is that it refused to be pricked, and bounced straight back from $800 (bitstamp), which has become a strong support. The probability that it will be breached (for anything more but a flashcrash, maximum) has strongly diminished.

Gox also held well.

But who had a look at BTC China? It refused to be manipulated at all! The spread between China and Bitstamp went to +20% due to stamp crashing, whereas both the day before and after it was close to 0%. China is providing so immense liquidity that it has changed the game totally.

The weekend was the best opportunity for taking the price down, and all tricks were pulled, but it seems to have just proven that the $1,000 level is legitimate. It is a nice, round figure, and fundamentals and exponential trends are soon catching it. The lacking volume in these prices, which was my concern, and the topic of this thread, has feen fulfilled.

I am sorry if my bearish call in Nov 19 was misinterpreted as an exhortation to sell all, or even half of anyone's holdings. With bitcoin, most of the holdings should be in cold storage and the rest diversified to other forms of wealth according to a predetermined plan, for example the SSS plan.

During the flashcrash, I net increased my BTC position by about 80,000mBTC. Still well prepared to any scenario. (Is there anyone else that handles position management professionally/systematically (as opposed to feeling-based)?)

lol, you are sorry :-)

[rpietila]

Sorry for me, because the flashcrash buyback was about $820, and I sold at $672, therefore lost money on that trade irrevocably.

Sorry for those who do not understand that a strong sell with bitcoin means to sell 30% of your holdings and a weak sell is 10% (as opposed to stocks where sell means sell all, and strong sell is go short).

[wobber]

Sorry for me, because the flashcrash buyback was about $820, and I sold at $672, therefore lost money on that trade irrevocably.

Sorry for those who do not understand that a strong sell with bitcoin means to sell 30% of your holdings and a weak sell is 10% (as opposed to stocks where sell means sell all, and strong sell is go short).

I think you're susceptible to loosing most of your bitcoins if you daytrade them. What do you mean a strong sell is 30%? That's loosing more!

[rpietila]

What do you mean

There is very much logic in my writings, but in order to follow it, you have to spend 30 minutes per day just by following and thinking about me. Because most people are unwilling to do it, they only get a part of the message, and it is dangerous to act upon incomplete logic.

Just haven't found a way to do it any other way  Even if I write very perfect guides on all things Bitcoin, I cannot make people follow every aspect of them, and the result will be in their hand anyway.