Is it stabilizing?

[PinkiePie]

Discuss.

[adamstgBit]

the clam b4 the storm...

[Revalin]

The fundamentals don't support $5/BTC, so the price is supported by speculation.  Speculation is unstable.

So no.

[saykor]

Discuss.

1-2 day not mean "stabilizing"

[alan2here]

When was the last time you would consider it stable?

[coined]

when gox was down, it stayed at 17 for a while 

[miscreanity]

the clam b4 the storm...

Yes, there very often is a clam before a storm. Then it spits in your eye.

[Minsc]

It jumps randomly somewhere each day and then stagnates for a day, then repeats.

[Ratman2050]

the clam b4 the storm...

^ the clam hehe

[johnj]

the clam b4 the storm...

^ the clam hehe

[turquoise9955]

doubt it.

[neptop]

Everything GREEN!

[V4Vendettas]

Everything GREEN!

WHY YOU JINX IT WHY!!??

[d.james]

YES!

[BitMagic]

The fundamentals support $5/BTC, so the price is supported by true value.  True value is stable.

So yes.

[Revalin]

My method puts the fundamental value in the low cents range.  How do you compute fundamental support at $5?

[BitMagic]

My method puts the fundamental value in the $5 range. They rest on the overall state of the economy, interest rates, production, earnings, and management. How do you compute fundamental support at the low cents range?

[Technomage]

A fundamental value in the low cents range is ridiculous. For me the fundamental value is supported by the size of the economy (transaction count) and the general interest people have in Bitcoin. That's all I need. Those indicators currently support a price at around $5 very well. It's based on the correlation of past value and these indicators, which so far go together fairly closely.

A price higher than where it is now is mostly based on the future expectation people have for Bitcoin and based on that we're heading towards higher prices again, because the general mood of the market is changing. Optimism is winning against pessimism.

As far as OP's question goes, there's no stabilizing in sight. We might see stabilility when the market is 100 times bigger than it is now. Before then we will have small stable periods but other than that it's either going to go up, down or jump all over the place.

[Revalin]

My fundamental value is a floor based on commerce.  My assumptions:

• The price is driven by utility (people who use coins to buy things) plus speculation (people who buy coins mainly hoping they will gain value)
• Utility is based on enthusiasts (people who use coins but do not use an exchange, IE, treating it as an isolated currency) plus practical users (people who use coins as a proxy for their local fiat)
• 80% of coins do not hit the exchanges, either due to loss, long term hoarding, or enthusiasts
• The remainder are traded for utility (upon which I base my price floor) and speculation
• Actual commerce in BTC is around USD$10,000 per day

The practical-utility cycle is: buy coins on an exchange; store them in the wallet for a few days while shopping; buy goods; merchant sells coins on an exchange.  The fundamental value is the minimum required to fulfill this need.  Here's the formula I use:

Utility == ($10,000 commerce per day) * (3 days average time coins are held) / (  (7.2M total coins) * (20% coins in circulation)  ) == ($30,000 stored value) / (1.8M coins) == USD$0.0208 per BTC.

Note that I've already included hoarders in that price.  So, in my opinion, the remainder of the difference between the $0.02 floor and the $5.00 current price is speculation.

My speculation:  I don't think it will ever hit my $0.02 floor.  As the price starts dropping close to that (perhaps $0.20) the floor will start cushioning the fall, and when that happens people will become comfortable holding coins for longer periods.  Unfortunately at those lows it's cheap for speculators to start driving it up again (Yay! the crash is over!  BUY BUY BUY), though the next bubble won't be nearly as big as the first.  The bottoms of the speculative waves will find a practical bottom around $0.20, at least until utility is increased by stability (longer hold times) and greater daily commerce.

So, your turn.  How do you compute fundamental value?

[BitMagic]

I was just giving you a hard time. I don't really trust "fundamentals" any more than I do historic prices projecting future prices. I take my walks random.