rpietila Wall Observer - the Quality TA Thread ;)

[rpietila]

Wine and Cigars are on the House.

[wobber]

Hi. I want a glass of red wine.

[MAbtc]

Excellent. I look forward to hearing your thoughts. Are you surprised by the extent of this rally from 12/17? What probability do you give to the reemergence of a bull market at this point?

[rolanberry]

I don't smoke! o-o

Will read this thread, thanks very much and such.

[windjc]

Awesome. Look forward to the thread. Hope you will allow for healthy debate.

[bitrider]

What is harder, is what to tell to the customers and business associates of various kinds. Is this the buy price or not, and for what kind of people/in what conditions it is?

This is my current question as well. There are many around me asking "should I buy in now?" Just as you suggested in you SSS post, I'm pretty sure the answer is yes...if they plan to hold for at least a year. But finding the right percentage of total available risk capital is harder.

For myself, I'm happy to just hold, and buy on dips.

Look forward to the thread. Have benefited greatly from all previous RP hosted threads.

[T.Stuart]

What is harder, is what to tell to the customers and business associates of various kinds.

Do they understand the meaning of the word, "Hodl"?

[notme]

Hi. I want a glass of red wine.

Well, it's 2pm on the last Sunday before I start the final semester of my masters degree.  I've just moved into a new apartment and bought myself a corkscrew for this wine I've had for months.  It seems like a good time to open a bottle and sort through all these boxes.

In the mean time, I've got a small long position on bitfinex with a base of $890 just for kicks.  This might well be a bull trap/B wave, but I think I can get at least a few more percent out of this move.  But please don't trade on my speculation, do your own research.


Edit:  well, hot damn... That was a nice jump while I typed this.  I sold out most and claimed the profits in BTC.

[rpietila]

Excellent. I look forward to hearing your thoughts. Are you surprised by the extent of this rally from 12/17? What probability do you give to the reemergence of a bull market at this point?

Surprised: Yes. In a sense that I would have given it <50% probability (and therefore bet against it).

Reemergence of bull market: this requires a lengthier explanation which is based on the trendline model.

The trend is adjusting itself all the time, but it already has 5 years of data, which means that the new datapoints do not change it much. I have high confidence on the predictive ability of the trend, because I believe it tells us the market-tested maximum increase rate based on infrastructure and psychological factors mainly. According to the trend, we will reach $1M in 12/2016. It is quite breathtaking speed actually.

A
Ultimate definition for a bull market is that the trendline will never be revisited. The rate of growth of bitcoin economy would have changed, which means that the trendline should be recalculated with only the new data (since 1.1.2013 for example). The new booms and busts would conform to the steeper trend and not the old (which did call the bottom in 2011, and was very good in 2013). This would mean that $1M is reached sooner than 12/2016.

B1
Intermediate1 bull market is something that would now have started, and will run its course and crash to the trendline and below sometime so far in the future that it would have been better to buy now. Such as 2011 before the bubble. This will of course affect the trendline slope to the upside, since so long time would have been spent significantly above it.

B2
Intermediate2 bull market means that we make the new ATH and go beyond, but in the aftermath visit the trendline and below such that it is advantageous to wait considering the risks and such (going below $800). The trend would be pretty much intact in this scenario. (According to the trend, we would close the year 2014 at $6,356, which means that the likely price is between $3k-$13k.)

C
Bull market is not resumed, and we will turn down before making an ATH. Likely by the end of March, there will be an event allowing purchase at $300-$400 for the nimble, and the general consensus price will be at $500s, making this price available for all.

I would currently give the odds:
A = 15%
B1 = 20%
B2 = 25%
C = 40%.

Note that there will probably be flashcrashes in the way, which gives entry points to those who believe in the bull market but don't want to commit all now.

[Voodah]

Just woke up so a little early for wine, but I'm down for some TA.

[porcupine87]

But is the bitcoin price not news driven? Good news -> price goes up. Bad news -> price goes down. Maybe some technical analysis might be helpful for day trading, but in the long run? I don't know. On the other hand many people believe in this technical analysis. Therefore many trades act like this and therefore the price.

So my question is:
How helpful is a exploration only based on a chart line? I saw here many, many lines in charts which seemed to look good but most of them where wrong and of course some where right (if 100 people bet on a single number in roulette, some will hit the right number. But that does not make them to prophets).

I am not sure if this is trolling. Once I made a critical post in rpietila's thread and was deleted instantly.

[NamelessOne]

Great thread, I look forward to your future posts. 

[notme]

But is the bitcoin price not news driven? Good news -> price goes up. Bad news -> price goes down. Maybe some technical analysis might be helpful for day trading, but in the long run? I don't know. On the other hand many people believe in this technical analysis. Therefore many trades act like this and therefore the price.

So my question is:
How helpful is a exploration only based on a chart line? I saw here many, many lines in charts which seemed to look good but most of them where wrong and of course some where right (if 100 people bet on a single number in roulette, some will hit the right number. But that does not make them to prophets).

I am not sure if this is trolling. Once I made a critical post in rpietila's thread and was deleted instantly.

People who know the news before it is published leave traces in the market.  That is why TA is able to account for news.  However, if you believe TA is simply lines on charts, that would explain why you think it is bunk.  A successful technical analyst looks at many factors and indicators to determine the state of the market and general sentiment about the market.

[samson]

I know you're a metals guy, specifically Silver but do you think there will be any significance if / when Bitcoin reaches and then passes Gold price parity ?

This is a big unknown right now. It could bring a huge amount of publicity around the world like news headlines of 'Bitcoin worth more than Gold', talk of digital gold, dawn of a new era, etc, etc.

If someone purchases about 10-11k of BTC right now one Bitcoin will be more expensive to buy than an ounce of gold.

[fluidjax]

I would currently give the odds:
A = 15%
B1 = 20%
B2 = 25%
C = 40%.

Note that there will probably be flashcrashes in the way, which gives entry points to those who believe in the bull market but don't want to commit all now.

In essence you are saying that with an 85% probability we will return to the trend line.
And that Facebook rumours, netflix rumours, zynga, overstock etc. this type of news event is necessary to continue this trend.
i think the piece you are missing is that even if this underlying trend line remains intact, we may experince a lift above it from one of the pieces of news, and then stagnate slightly at a high level until the trend line rejoins when it catches up.
I don't necessarily believe the we need to drop back down to the trend if the news is exceptional.

[pietje]

Excellent. I look forward to hearing your thoughts. Are you surprised by the extent of this rally from 12/17? What probability do you give to the reemergence of a bull market at this point?

Surprised: Yes. In a sense that I would have given it <50% probability (and therefore bet against it).

Reemergence of bull market: this requires a lengthier explanation which is based on the trendline model.

The trend is adjusting itself all the time, but it already has 5 years of data, which means that the new datapoints do not change it much. I have high confidence on the predictive ability of the trend, because I believe it tells us the market-tested maximum increase rate based on infrastructure and psychological factors mainly. According to the trend, we will reach $1M in 12/2016. It is quite breathtaking speed actually.

A
Ultimate definition for a bull market is that the trendline will never be revisited. The rate of growth of bitcoin economy would have changed, which means that the trendline should be recalculated with only the new data (since 1.1.2013 for example). The new booms and busts would conform to the steeper trend and not the old (which did call the bottom in 2011, and was very good in 2013). This would mean that $1M is reached sooner than 12/2016.

B1
Intermediate1 bull market is something that would now have started, and will run its course and crash to the trendline and below sometime so far in the future that it would have been better to buy now. Such as 2011 before the bubble. This will of course affect the trendline slope to the upside, since so long time would have been spent significantly above it.

B2
Intermediate2 bull market means that we make the new ATH and go beyond, but in the aftermath visit the trendline and below such that it is advantageous to wait considering the risks and such (going below $800). The trend would be pretty much intact in this scenario. (According to the trend, we would close the year 2014 at $6,356, which means that the likely price is between $3k-$13k.)

C
Bull market is not resumed, and we will turn down before making an ATH. Likely by the end of March, there will be an event allowing purchase at $300-$400 for the nimble, and the general consensus price will be at $500s, making this price available for all.

I would currently give the odds:
A = 15%
B1 = 20%
B2 = 25%
C = 40%.

Note that there will probably be flashcrashes in the way, which gives entry points to those who believe in the bull market but don't want to commit all now.

you really think we will reach 1mil? Eventually bitcoin is adopted and the rise stops right? Unless the dollar collapses ofcourse..

[rpietila]

I am not sure if this is trolling. Once I made a critical post in rpietila's thread and was deleted instantly.

As outlined in the OP, deletion may happen if:

double bottoms = unrelated pictures
ad hominem = personal attacks
trolling = disturbing the conversation
low level comments = not enough novel content (first post is ok to be short, because that way you bookmark the thread).

If you disagree with something, you need to challenge the content (not the writer) of the post, and do it in the same level of depth as the challenged content. It is highly appreciated to write a thought-out piece refuting everything I say. It is not OK to say that "$500 will never happen and RP is stupid".

[KFR]

There are plenty of decent arguments for future valuations far in excess of $1m.  It's interesting how the psychological barrier that $1m represents seems to truncate even the most objective analysis.

[User705]

Bitcoin adoption and dollar collapse might not be very linked.  Dollar might collapse in value anyways.  And bitcoin adoption can happen or perhaps another crypto takes over with or without dollar collapsing.

[JimboToronto]

Hi Risto.

I know the thread title says "Quality TA" but I'm less inclined toward traditional TA for Bitcoin and give more weight to news and developments.

My read is that many people over-estimated the impact of China's involvement and over-reacted to their government's response. I think the rally was due regardless of China's involvement and the rally post-China-crash is just a natural continuation of what would have happened anyway.

I felt last summer that Bitcoin would rally in the fall due to the infrastructure developments that were started last spring, most notably at the big convention in California.

An example is BTC ATMs. When they were announced last spring, little attention was paid to them. When the first was opened in Vancouver in October, it generated a media buzz that might have helped kick start the autumn rally. On Friday I visited Toronto's first BTC ATM, which is also the first Canadian-made BTC ATM. Soon there will be multiple BTC ATMs in cities worldwide.

Every day it seems some high-profile individual or organization speaks out favorably about Bitcoin or considers it as a payment option. The ball is just staring to roll and will snowball soon enough.

Sorry if this isn't the technical analysis you were looking for, but it's what I feel matters most.
______

btw Enjoy your Cohiba and port. Some people might be jealous of your stated indulgences, but that's their problem.

I don't smoke tobacco but I'll roll a cigar of my favorite medicinal herb and join you for a glass of Taylor Fladgate late-bottled 2007. I know, it's just cheap port but it's all I have on hand, and perfectly compliments the flavor of a good 6-year-old raw milk cheddar or perfectly ripened truffled brie.

You don't have to be rich to enjoy the finer things in life (but it certainly helps!) I'm willing to wait another year or two.