rpietila Wall Observer - the Quality TA Thread ;)

[bitdig]

If it turns around I would start worrying after it passes 550

I have a question to the bears. If the price does in fact go the other way at what level will you start buying back? At what level will you panik buy?

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[AnonyMint]

A wallet that tracks your fiat cost base is important to develop so that U.S. people can pay taxes, but "discussion" about it among people who don't have the capability to make it (not to say it is difficult because it is a standard requirement for enterprise accounting since 1800s) is moot.

The issue is not just record keeping and calculation, but also planning and timing. The timing on planning interferes with the timing-fungibility of money. This is one of the reasons why investments are not money.

He missed the point. If everyone has to factor the timing of tax planning into the timing of spends, then money sometimes loses the main reason it existed, which was to remove the gridlock caused by barter due to mismatches of the timing of what trading parties wanted to trade. For example, you want to buy that $1000 item, but this would move you into a higher tax bracket for the year, so you must wait until after Dec. 31.

You set up your wallet software such that it automatically spends the last earned coins, which makes it a wash generally (or yields a small gain for which you need to pay taxes and be happy that you get to keep about 60-90% of the purchasing power that would have been 100% lost to inflation in the case you had been using USD instead of Bitcoin). This is similar to using currency.

If you are spending more than you earn, then your wallet spends the coins that were accumulated earlier, in which case you suffer a larger tax hit. This is similar to selling your investments for profit, and paying taxes.

Can someone else explain why this is the end of Bitcoin because I fail to see it?

You still don't get it. It may have nothing to do with minimizing BTC gains.

The issue is that tax law is complex. For example there is a $1000 Tax Credit where if you earn less than a certain amount or more than another higher amount, you don't get the credit. So it happens that you are ready to spend BTC on Dec. 23rd for Xmas gift, but it would push over the bracket and you lose $1000. So you need to decide to not spend until Jan 1 (much too late for Xmas). Thus Bitcoin wasn't money for you.

[AnonyMint]

I just read a comment in the Darkcoin thread where a user said he bought in too high and is tempted to sell but is holding on.

These are the ones who capitulate when there is blood on the streets. I bet he sells at $300.

There is no blood yet. They are still hodling on.

[jmw74]

A wallet that tracks your fiat cost base is important to develop so that U.S. people can pay taxes, but "discussion" about it among people who don't have the capability to make it (not to say it is difficult because it is a standard requirement for enterprise accounting since 1800s) is moot.

The issue is not just record keeping and calculation, but also planning and timing. The timing on planning interferes with the timing-fungibility of money. This is one of the reasons why investments are not money.

He missed the point. If everyone has to factor the timing of tax planning into the timing of spends, then money sometimes loses the main reason it existed, which was to remove the gridlock caused by barter due to mismatches of the timing of what trading parties wanted to trade. For example, you want to buy that $1000 item, but this would move you into a higher tax bracket for the year, so you must wait until after Dec. 31.

You set up your wallet software such that it automatically spends the last earned coins, which makes it a wash generally (or yields a small gain for which you need to pay taxes and be happy that you get to keep about 60-90% of the purchasing power that would have been 100% lost to inflation in the case you had been using USD instead of Bitcoin). This is similar to using currency.

If you are spending more than you earn, then your wallet spends the coins that were accumulated earlier, in which case you suffer a larger tax hit. This is similar to selling your investments for profit, and paying taxes.

Can someone else explain why this is the end of Bitcoin because I fail to see it?

Like most other bitcoin issues, you've analyzed it correctly and other people are just spewing their knee-jerk reaction:  "Oh no, if I use bitcoin I have to report my gains to the IRS?  I never had to do that with dollars."  THAT'S BECAUSE YOU HAD NO GAINS BEFORE.

IIUC, in the US, you can use whatever method of accounting you want (FIFO, LIFO, etc), as long as you don't count the same bitcoin twice.  However your LIFO suggestion makes the most sense for those wanting to use bitcoin as a currency.

I still don't understand this stuff about bitcoin not being fungible now.  It's still fungible.  Just because you bought them at different prices doesn't mean it matters which are which.  Shares of stock are still fungible despite the reporting of capital gains.

[AnonyMint]

I never had to do that with dollars."  THAT'S BECAUSE YOU HAD NO GAINS BEFORE.

Read my post above this one, so you can have an epiphany.

The issue is that gains impact tax brackets and credits and all sorts of tax planning.

So you can't just take all the gains you can get.

You have to restrict yourself to scenarios.

This ruins the timing of being able to spend money when ever you want to.

At least this is how impacts some people. Maybe your tax situation is different and you take all the gains you can get, because you are in an investor class. But the common man is not. He has all sorts of things to balance, such as reporting his unemployment assistance, tax credits, solar installation energy credit, alternative minimum tax, etc....

P.S. We do have gains with dollars when we trade for another investment. Yet we are not charged for those gains until we sell and come back into dollars.

[koryu]

If it turns around I would start worrying after it passes 550

I have a question to the bears. If the price does in fact go the other way at what level will you start buying back? At what level will you panik buy?

so everything lower 550 would be just a bulltrap for you?
i think that will be the problem for the bears, as soon as the green volume bars start to be larger than the red volume bars, it could be the reversal or only a bull trap. 

[AnonyMint]

If it turns around I would start worrying after it passes 550

I have a question to the bears. If the price does in fact go the other way at what level will you start buying back? At what level will you panik buy?

so everything lower 550 would be just a bulltrap for you?
i think that will be the problem for the bears, as soon as the green volume bars start to be larger than the red volume bars, it could be the reversal or only a bull trap.  

I don't expect a V reversal. I am waiting for it to get errie quiet after everyone has capitulated and exhausted their fiat capital.

I expect a long U reversal.

However working against my scenario is the bottom price rises about $10-15 per week that this drags out.

[MatTheCat]

Interesting points, but:

The last capitulation could very well happen again.

What I notice about the July 2013 capitulation is some very high volume (relative to the time) around the days prior to and after the final low. In contrast, the volume around the present low has been in contrast, average and the most notable trades have been large scale dumps, with the price rising on much lower volume. I am open to the idea of this being a big fish accumulation period and will gladly jump on board the gravy train when/if Bitcoin rebounds proper off the $400 zone, which I think it will in the first instance as too many people are seeing this as the ultimate bottom. However, for this to be a trend reveral proper, Bitcoin needs to break through the long term down trend that has been in place since the Dec double top. The big fishes will have done their shopping  $400-$450, the gravy train riders will have gotten in $450-$500, the panic buyers $500-$550........and then who is buying? Nobody? Well guess what happens next amongst a back drop of hoardes of stolen coins and arbitrage taking and USD cashing out Chinese? If Bitcoin swings strongly upwards from the $400 zone, but fails to break and confirm itself beyond the long term down trend, I doubt that the market will waste much time in deciding Bitcoin's fate. There will be no doubts and a race to take profits/cut losses. How would support at and above $380 be if such a scenario were to play out, and lets face it, it easily could. Hate to say it but what Bitcoin probably needs to avoid an inevitable slide below $380 is some kind of isolated non USD economic crisis, and a bit of good old capital flight.......which is what I have come to believe Bitcoin was designed for in the first place (I have gone from being a libertarian 'believer' to having the view that Bitcoin is most likely a US intelligence agency project) .

[RAJSALLIN]

If it turns around I would start worrying after it passes 550

I have a question to the bears. If the price does in fact go the other way at what level will you start buying back? At what level will you panik buy?

so everything lower 550 would be just a bulltrap for you?
i think that will be the problem for the bears, as soon as the green volume bars start to be larger than the red volume bars, it could be the reversal or only a bull trap. 

I don't expect a V reversal. I am waiting for it to get errie quiet after everyone has capitulated and exhausted their fiat capital.

I expect a long U reversal.

Well we have a U forming.

[RAJSALLIN]

I find it comical that the opinions here seem so certain and grounded. For a change, I think we can up I also think we can go down.

[AnonyMint]

If it turns around I would start worrying after it passes 550

I have a question to the bears. If the price does in fact go the other way at what level will you start buying back? At what level will you panik buy?

so everything lower 550 would be just a bulltrap for you?
i think that will be the problem for the bears, as soon as the green volume bars start to be larger than the red volume bars, it could be the reversal or only a bull trap.  

I don't expect a V reversal. I am waiting for it to get errie quiet after everyone has capitulated and exhausted their fiat capital.

I expect a long U reversal.

Well we have a U forming.

I don't see enough capitulation yet. Risto needs to buy too high first.  

I am not certain. I just don't see any reason the bottom should be here. Why? What happened to make it a bottom?

Recent sentiment isn't exhausted yet. It is just getting started. Most don't even understand the tax implication issue yet.

[jmw74]

I never had to do that with dollars."  THAT'S BECAUSE YOU HAD NO GAINS BEFORE.

Read my post above this one, so you can have an epiphany.

The issue is that gains impact tax brackets and credits and all sorts of tax planning.

So you can't just take all the gains you can get.

You have to restrict yourself to scenarios.

This ruins the timing of being able to spend money when ever you want to.

At least this is how impacts some people. Maybe your tax situation is different and you take all the gains you can get, because you are in an investor class. But the common man is not. He has all sorts of things to balance, such as reporting his unemployment assistance, tax credits, solar installation energy credit, alternative minimum tax, etc....

Let's just compare the same person spending dollars vs spending bitcoin.  Their tax situation is exactly the same except for a small amount of CG on the bitcoin they spent.  How is paying CG worse than having no gain at all?

If you expect the CG to be significant, that means they must have held bitcoin as savings or investment, and not spent it before their next paycheck arrived.

Edit:
Now that I see your other post - I'm not a tax expert, but I have yet to see one tax credit that is all or nothing based on some income threshold.  Obviously that creates perverse incentives to avoid going over the threshold.  However, in the US at least, none of them work like that, or if any do, they're so uncommon as to be irrelevant to bitcoin adoption.

[Zule]

I have a question to the bears. If the price does in fact go the other way at what level will you start buying back? At what level will you panik buy?

It will be the volume, not the price that will push the bears into panic buy

[hdbuck]

I have a question to the bears. If the price does in fact go the other way at what level will you start buying back? At what level will you panik buy?

It will be the volume, not the price that will push the bears into panic buy

yea and it will be the volume too that will squeeze the last bulls out on panic selling when we go for another dip

[RAJSALLIN]

If it turns around I would start worrying after it passes 550

I have a question to the bears. If the price does in fact go the other way at what level will you start buying back? At what level will you panik buy?

so everything lower 550 would be just a bulltrap for you?
i think that will be the problem for the bears, as soon as the green volume bars start to be larger than the red volume bars, it could be the reversal or only a bull trap.  

I don't expect a V reversal. I am waiting for it to get errie quiet after everyone has capitulated and exhausted their fiat capital.

I expect a long U reversal.

Well we have a U forming.

I don't see enough capitulation yet. Risto needs to buy too high first.  

I am not certain. I just don't see any reason the bottom should be here. Why? What happened to make it a bottom?

Recent sentiment isn't exhausted yet. It is just getting started. Most don't even understand the tax implication issue yet.

Fair enough. About the tax situation at least in Sweden I know the Swedish IRS won't be going after bitcoin purchases. Bitcoin exchange transfers however will be a different ball game but that's not strange. I personally think you are too fearing of taxes and the government agencies collecting them. Even with an economic collapse a la Armstrong (which I'm counting on as well) there will not be a crusade to tax bitcoin purchases on orderly purchases, imo.

[LOADING.READY.RUN]

How can switch Blockchain.info default language away from Turkish to another language? It reverts back every time I click a page.

Go to your browser settings and erase all cookies related to blockchain.info

[aminorex]

Allow me to an express a view on the factual points you raised, creekbore:

I'm talking about the fact that the news, satire programs, newspapers, magazines etc ridicule BTC.

All press is good press.  Just wait until the next wave of pedophiles and terrorists.

I talk to people about BTC and they think I'm a crank.

Always true of the vanguard.  It means there's a lot of upside.

The IRS statement,

Good news.  Institutional money would not touch it until there was tax clarity.

China's slow strangulation of BTC,

Admittedly painful, but to be expected, and not in any way fatal.

Gox,

That's over.

the FUD surrounding NeoBee

NeoBee is rather minor.  Cyprus?  Noise.

The bid/sum ratio is dreadful, you can't dispute the numbers

Bids 50% out from the book can't be taken seriously.

You bring up adoption metrics but I actually raised this issue -- most of the data available through blockchain suggest adoption is going very poorly.  But instead lets focus on a single set of data (increased BTC addresses) ...but I use a new address for withdrawals and deposits everytime I do a BTC tx.  I suspect many do the same, so this data is meaningless.  No-one comments on this.

You are mistaken regarding which number I deem significant.  New addresses is not significant.  The number of active addresses during a rolling window is the best representation available for the size of the commerce network.  The only other number which reflects this vigor is the value transferred, again, during a rolling window.

Instead I get a page of n^p x p>x means everything is OK. 

It is what it is.  Whether it is OK or not is very subjective.  You might enjoy a benzodiazepine.  Not too much now.  It will make you feel things are a bit more OK.

Price can do many things, but it can't deviate from fundamental value for too long, or there is arbitrage.

[rpietila]

I don't see enough capitulation yet. Risto needs to buy too high first.  

Now I see that you need sleep. I have as many bitcoins now as I had a year ago, but bought a castle and have sizable fiat reserves with the profits. "buying too high" can only attributed to my name if the speaker does not see the picture  

[AnonyMint]

I don't see enough capitulation yet. Risto needs to buy too high first.  

Now I see that you need sleep. I have as many bitcoins now as I had a year ago, but bought a castle and have sizable fiat reserves with the profits. "buying too high" can only attributed to my name if the speaker does not see the picture  

Who needs sleep when they mistake a joke for a serious statement?

Can't you tell that I see you are emotionally flustered and I am poking you. Now you played your pride card.

Risto you will talk all strong then if it goes lower you will say you only put 60% odds on it bottoming. You try to play both sides and always be seen as correct.

[Zule]

Who needs sleep when they mistake a joke for a serious statement?

Can't you tell that I see you are emotionally flustered and I am poking you. Now you played your pride card.

Its just an excuse to talk about the castle, dont be alarmed