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Author Topic: Warning: How many of you Bears have ever been a victim of a Short Squeeze?  (Read 41048 times)
cypherdoc
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October 18, 2011, 11:44:44 AM
 #1

I have.  And its not pleasant.  In fact, they are extremely vicious.  Without appropriate risk management, they have the ability to wipe you out.

Imagine the Spring ramp repeating itself while you're holding short.  The mentality has settled in with virtually all the Bears that Bitcoin is done and is going to zero.  They are taking their victory laps and cheering their profits.  This type of mentality is just as bad as the speculative bubble, only in reverse.  

I have most unpleasant news for you.  The Squeeze of the Century is coming.  It may not be tomorrow, next month, or even next year, buts its coming and you will be crushed.  

I know the feeling.  You shorts are probably sleeping less well now while you're making profits than you did before.  Thats because deep down you know the protocol has not failed, you know that 99% of the people want Bitcoin but just don't know it yet, you know the developers are still out there and working on improvements, and you know that big money is waiting on the sidelines for the perfect time to buy and buy hard.

Typically the ramps come in the middle of the night.  You wake up and the price has doubled trapping you deeply in the losing trade.  You wait and wait for the price to come back down but it never does as the price moves upwards incessantly to force you to cover.  The pendulum has swung too far to the wrong side.

Just wait.  Its coming...
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October 18, 2011, 11:47:53 AM
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how many places are there where you can short BTC?
cypherdoc
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October 18, 2011, 11:50:40 AM
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i've only heard of one; Bitcoinica.  never been there but i bet its popular right now.

i only hope they've made sure all their clientele have posted above average margin requirements when the Squeeze comes.  Bitcoinica could be wiped out as well if they haven't done this.
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October 18, 2011, 12:01:59 PM
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Why does it bother you so much that people are making money, even while btc is in a decline? 

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October 18, 2011, 12:31:02 PM
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i'll just leave this here: https://bitcointalk.org/index.php?topic=43713
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October 18, 2011, 12:47:33 PM
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you know that big money is waiting on the sidelines for the perfect time to buy and buy hard.
I’m just wondering what the perfect time is? The 4.18 double bottom with capitulation sell volume looked pretty convincing, and yet it didn’t progress beyond 7/6.8, implying there was no big money involved.

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October 18, 2011, 12:50:00 PM
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 hehehehehehehe, limit shorts without checking bids FTL. ;p thanks for the read.  Kiss

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October 18, 2011, 12:50:34 PM
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i've only heard of one; Bitcoinica.  never been there but i bet its popular right now.

i only hope they've made sure all their clientele have posted above average margin requirements when the Squeeze comes.  Bitcoinica could be wiped out as well if they haven't done this.

Interestingly, Bitcoinica has been in net long for the past 24 hours.

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October 18, 2011, 01:29:05 PM
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Why does it bother you so much that people are making money, even while btc is in a decline? 

it doesn't bother me at all.  because they will soon give it all back and more.
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October 18, 2011, 02:20:14 PM
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i've only heard of one; Bitcoinica.  never been there but i bet its popular right now.

Never been there and don't feel like creating an account. But I'd really like to know: Can you do really naked shorts? Like in betting money you don't have?

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October 18, 2011, 03:21:07 PM
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i've only heard of one; Bitcoinica.  never been there but i bet its popular right now.

Never been there and don't feel like creating an account. But I'd really like to know: Can you do really naked shorts? Like in betting money you don't have?

If there's a pool of huge reserves of USD and BTC, why not? You can long BTC with only BTC, or short BTC with only USD.

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October 18, 2011, 03:36:50 PM
 #12

the connections are up at mtgox and the price is rising.  buying going on.
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October 18, 2011, 04:08:44 PM
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shorting it at 2.x is crazy...  the most you can make is 2.x ...  most likely .x   

But long it could multiple if held long enough....


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October 18, 2011, 04:20:08 PM
 #14

shorting it at 2.x is crazy...  the most you can make is 2.x ...  most likely .x  

But long it could multiple if held long enough....



yes.  being short here could lead to infinite losses when the price turns up.
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October 18, 2011, 05:33:50 PM
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shorting it at 2.x is crazy...  the most you can make is 2.x ...  most likely .x   

But long it could multiple if held long enough....



I don't know about that.  With a flurry of news articles on the horizon about the end of bitcoin I think we'll see another frenzy of dumping which could take bitcoin to levels where we see enough people abandon mining that for the few people still trying to move these things around the blockchain the process gets very, very slow.
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October 18, 2011, 05:38:55 PM
 #16

Never been there and don't feel like creating an account. But I'd really like to know: Can you do really naked shorts? Like in betting money you don't have?

No.  You have a margin requirement.  You can go short but it is backed up by your margin.  If you hit marginal call they close your posistion for a max loss.

With the volatility of Bitcoin I wonder how many "traders" have already been stopped out for a max loss.
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October 18, 2011, 06:07:33 PM
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I just want to make it clear that shorting bitcoin should not be equated with pessimism or negativity.
Bears can turn Bulls and Bulls can turn Bears.
The price was too high to be sustained with the current injection rate + difficulty.
The ability to short has been a blessing to get us back to prices that can be sustained long term.

I do agree that current shorters should throttle off quite a bit - I definitely wouldn't be shorting on margin right now.
They should also start considering going long term bullish. That's where I'm at right now with current prices.
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October 18, 2011, 06:54:51 PM
 #18

i just want short sellers to realize that a short squeeze is a predatory manipulation meant to kill the short seller.  if there's money to be made doing it, it will happen.  and right now, there are alot of people offsides.
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October 18, 2011, 11:30:41 PM
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i just want short sellers to realize that a short squeeze is a predatory manipulation meant to kill the short seller.  if there's money to be made doing it, it will happen.  and right now, there are alot of people offsides.

There's not enough benefit in this. Most short sellers were shorting since long ago. One of my customers has already made 230% profit. The recent crash only induced more long positions.

Short sellers are far from being liquidated because they have a lot of profits to back their positions.

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October 19, 2011, 12:10:48 AM
 #20

i just want short sellers to realize that a short squeeze is a predatory manipulation meant to kill the short seller.  if there's money to be made doing it, it will happen.  and right now, there are alot of people offsides.

There's not enough benefit in this. Most short sellers were shorting since long ago. One of my customers has already made 230% profit. The recent crash only induced more long positions.

Short sellers are far from being liquidated because they have a lot of profits to back their positions.


precisely why they should be liquidating now; when they have those profits.  once the trend changes it will be rapid.
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