rpietila Wall Observer - the Quality TA Thread ;)

[Peter R]

Here's an updated graph that shows the Metcalfe relationship using both number of TXs and number of unique addresses:



The recent price decline brought the curves a bit closer together.  

[1714478821]

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[1714478821]

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[Peter R]

Zooming in a bit:



and a bit more:

[SlipperySlope]

Thanks for sharing these Peter, they are awesome.

[exocytosis]

The above chart looks to me like the uptrend in # of transactions is rounding off and turning downwards. (Not just the August top, but all of 2014)

Thoughts?

That's correct. We've already seen the top of the bitcoin bubble.

[wachtwoord]

The above chart looks to me like the uptrend in # of transactions is rounding off and turning downwards. (Not just the August top, but all of 2014)

Thoughts?

That's correct. We've already seen the top of the bitcoin bubble.

Which one?

I'll send you a postcard from the next.

[billyjoeallen]

rpietila, do you have any charts for total volume across all exchanges?
A bearish sign I just noticed yesterday, while switching tabs on bitcoinity and checking volume across several exchanges is that the volume is terrible compared to last year.
On some exchanges we are even lower than pre-november bubble.
This might be because volume is more spread out across all exchanges and this is what I would like to know if that's the case.

From Bitcoincharts.com, you can download all the data you need for making the comparison volume charts. I have some for my own use, and they confirm that volume is quite low now. I would attribute some of it to the increased OTC trading. Also people who hold BTC are satisfied with their holdings, the reason to shuffle them would come with increased prices but not before.

Coinbase and bitinstant transactions are off the blockchain if both buyer and seller use the same service. Also, as you have pointed out here, bitcoins on an exchange are just IOUs. If you don't hold the private keys, you don't have any bitcoin.

[Biodom]

rpietila, do you have any charts for total volume across all exchanges?
A bearish sign I just noticed yesterday, while switching tabs on bitcoinity and checking volume across several exchanges is that the volume is terrible compared to last year.
On some exchanges we are even lower than pre-november bubble.
This might be because volume is more spread out across all exchanges and this is what I would like to know if that's the case.

From Bitcoincharts.com, you can download all the data you need for making the comparison volume charts. I have some for my own use, and they confirm that volume is quite low now. I would attribute some of it to the increased OTC trading. Also people who hold BTC are satisfied with their holdings, the reason to shuffle them would come with increased prices but not before.

If you don't hold the private keys, you don't have any bitcoin.

It is like saying that if you don't control the "fundamental strings", then your body is not real.
I agree that it might not be fully safe, but I tend to think that coinbase bitcoins are real as representations of value since i can exchange these "virtual' btc to "real" btc at exactly 1:1 currently.

[fallinglantern]

I agree that it might not be fully safe, but I tend to think that coinbase bitcoins are real as representations of value since i can exchange these "virtual' btc to "real" btc at exactly 1:1 currently.

I'd say there's already precedent for exchange coins losing value very quickly:

[upupup]

[Jungian]

Zooming in a bit:



and a bit more:

I love the work you do. Looks like we are in undervalued territory if you go by the pics?

Think I'll just stick to my strategy of buying monthly.

[aminorex]

It is like saying that if you don't control the "fundamental strings", then your body is not real.

quoted for sheer preciousness

[EuroTrash]

Let me throw my chart in too:



I am not sure of course, but my nose says we are in the first quarter of 2012.

[wachtwoord]

What does the fair price line in that graph represent?

[EuroTrash]

What does the fair price line in that graph represent?

Estimated daily USD transaction volume (in USD) divided by 200000, which is the scaling factor that empirically fits best.

This is somehow like saying that a coin is worth about 0.0005% the total amount of coins exchanged every day.

Why that magic number? I don't know. Something about a balance between hoarding and spending habits of people: habits that are probably going to change over time, thus invalidating this graph. But to me it still holds at present. Which means we are slowly and painfully going to see 400s, maybe even 300s before reversal.

On a personal note I can't be bothered with trading right now. The swings won't be fast and I am not a patient man. Leaving most of my net worth in fiat for months on a bitcoin exchange, waiting for the bitcoin winter to end time to buy back lower, is more uncomfortable than having my coins sitting on my own cold storage.

[rpietila]

What does the fair price line in that graph represent?

Estimated daily USD transaction volume (in USD) divided by 200000, which is the scaling factor that empirically fits best.

This is somehow like saying that a coin is worth about 0.0005% the total amount of coins exchanged every day.

Why that magic number? I don't know. Something about a balance between hoarding and spending habits of people: habits that are probably going to change over time, thus invalidating this graph. But to me it still holds at present. Which means we are slowly and painfully going to see 400s, maybe even 300s before reversal.

On a personal note I can't be bothered with trading right now. The swings won't be fast and I am not a patient man. Leaving most of my net worth in fiat for months on a bitcoin exchange, waiting for the bitcoin winter to end time to buy back lower, is more uncomfortable than having my coins sitting on my own cold storage.

"Eating ice cream causes drowning." (<- in Finland, it is only possible to swim, and thus, drown, when it is very hot; this coincides with ice cream consumption).

Low transaction volume currently shows that most Bitcoin owners are content with the state of the most important reason why they have bought Bitcoin, namely value preservation. Surely there is high correlation between transaction volume and price, but an even higher correlation exists with value preservation and price.

[criptix]

Its a bit offtopic, but were you today chatting in the trollbox on polo? @risto

i would like to ask you what you think about the situation of xmr and btcd?

[rpietila]

Yes I do chat there often. I have a middleman plan where I acquire XMR for my friends, necessitating spending of time there.

I cannot comment on BTCD technology whether it is sound or not, but the launch and emission do not qualify for my investment criteria.

[EuroTrash]

Honestly it does not look to me like btc is doing a good job at value preservation. Not in the timeframes we are observing (daily candles below).



In comparison, the dollar is doing a better job. Because the prices at the grocer are the same as 3 months ago.
Of course it would be a different story if we compared btc to e.g. the Venezuelan bolivar.
Yet I do not see Venezuelans jumping on board in numbers.

Just saying... I am still a long term bull, and also looking forward to holding a Xapo card (or equivalent) so that I can really use coins everyday.

[rpietila]

Wealth preservation is something that needs to be done in timeframes longer than 3 months.

For example 3 years timeframe my bread just got 500 times cheaper..

[wachtwoord]

Wealth preservation is something that needs to be done in timeframes longer than 3 months.

For example 3 years timeframe my bread just got 500 times cheaper..

And 3 years is too short a time frame as well.