Something, something, something, technical analysis

[oda.krell]

Yesterday saw the break of the 1 month downtrend that took us from ~800 to 400. Broken with force, that is. What about the other, big one? Are we going to break through 720-730 as well, taking out the next longer downtrend in one go?



I'm skeptical we could reverse that fast, but current momentum sure makes it a possibility, I'd say.

What's your take on it?

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[phatsphere]

it could snap back during the next days. let's wait and see what the weekend brings ...

[sgbett]

me i'd discard the outliers. that would probably upset people though



mid april proper breakout from mid 500's on strong volume. we could always spike below that at some point but i reckon we are done with the selloff on the whole and are just waiting for the reversal.

I also don't think we are going to go exponential this time round. I think its going to be a long steady climb, that is going to cause much waling and gnashing of teeth, everyone will remain scared there could be a selloff at any time, and thus people will regularly sell off 'calling the top' waiting for the reversion to the downtrend.

all pretty standard market psychology really. we'll hit 4 figures this year, but it won't be easy for people to hold during the ride up.

[oda.krell]

it could snap back during the next days. let's wait and see what the weekend brings ...

Arguments in favor of snapping back could be that we are pretty overbought right now on the daily chart. Also, Bitstamp order book doesn't really pull along (very cautious bid/ask spike yesterday, but already softening up again).

On the other hand, we had a very impressive breakout, on high volume, CMF holds up extremely well (2h and 6h), and we keep attacking 700.

I can sort of see a case where we go down somewhat hard though once the market finds out 700 isn't sustainable right now, but even if that happens, I doubt we'll spend much time below 600.

[Miz4r]

I don't think that breaking above 720 would really officially end the downtrend that started since December. That trendline you have drawn only connects two points so it's not really that reliable. I would consider the downtrend to really be finished when we break through $1000 again.

[oda.krell]

I don't think that breaking above 720 would really officially end the downtrend that started since December. That trendline you have drawn only connects two points so it's not really that reliable. I would consider the downtrend to really be finished when we break through $1000 again.

agreed. I am extremely cautious using trendlines for anything other than as, hm, "background music", for my trading. And double so if there aren't much points of contact, as you point out. Still, the (shaky) trendline I drew corresponds to the larger question: "short-to-mid term downtrend seems broken, what about the mid term one since December." I could have asked that instead, but people like pretty pictures :D


ADDENDUM: You mention the number 1000 as well, and I've seen it several times in the last days... I don't buy that it's an important milestone right now. It's similar to how people thought the area between 200 and 260 was of major importance during the last recovery. It was, but only until later into the game. And in the end, it was broken rather swiftly (with help from China, of course).


My point is, right now I see 700, then 800 as major psychological milestones to be taken out, and possible points at which the recovery can start stuttering again. Once we're battling for 1000, I don't think we will still be wondering if 400 was the bottom.

[Dragonkiller]

But... but TERA told me we couldn't go above $666? 

 

[oda.krell]

But... but TERA told me we couldn't go above $666?  :'(

 :P :D

The guy made a number of excellent calls in the past weeks, give him a break :) But yeah... I think he was right about 666 being a focal point, but he got the resistance vs. support part wrong.

[Miz4r]

ADDENDUM: You mention the number 1000 as well, and I've seen it several times in the last days... I don't buy that it's an important milestone right now. It's similar to how people thought the area between 200 and 260 was of major importance during the last recovery. It was, but only until later into the game. And in the end, it was broken rather swiftly (with help from China, of course).


My point is, right now I see 700, then 800 as major psychological milestones to be taken out, and possible points at which the recovery can start stuttering again. Once we're battling for 1000, I don't think we will still be wondering if 400 was the bottom.

Oh I think 400 was the bottom unless horrible news comes along. That 400 bottom was part of a one-month downtrend within a larger 3-month downtrend, and we have broken the first one so I don't expect us to revisit 400 again any time soon. But we could still hover between 600 and 1000 for a couple weeks or perhaps even months before we definitely break through all resistances and let go of all the bearishness we've seen since December. So personally I consider the downtrend since December over once we break through 1000 and go into 4-digit territory again. And this time it may be for good just like when we left double digits behind since August 2013, 4 months after the April crash (not counting the SR flashcrash on Stamp).

[edit]Oh, and why do I think 1000 is such an important point? Well for one it's a psychological barrier, and besides that we've bounced our head firmly against 1000 twice since December now, failing to penetrate it.[/edit]

[Ibian]

My monies won't hit the exchange until tomorrow, so we will reach at least 750 during the night.

[antimattercrusader]

My monies won't hit the exchange until tomorrow, so we will reach at least 750 during the night.

LOL that is my luck. By time my toliet paper (fiat) arrives, BTC will be 1500. Then i'll buy and it will return to 500s. Gotta love my luck.

Coinbase seems to credit instantly, which is nice. It's helped with that. Now I'm not sure how luck will screw me over. Perhaps the clawback issue will be the 6-cell maglite in the ass of life?

[MAbtc]

Never saw 5-wave decline. More and more leaning towards something like this:



Bounce and close above momental channel ~ 620-630 and I lean towards trend reversal. But the bull case is on shaky footing as is.

Edit: Divergences.

[TERA]

I see that bear services have been requested here. While I have been bullish lately, I will be glad to make a good old bear chart

[Bitcoin_is_here_to_stay]

Love "fool's trend line".

Can you elaborate on "improper RSI" for a recovery? MACD seemed OK, imho, though.

[BitApparel]

downtrend already broken?  that is absolutely ludicrous

[TERA]

Love "fool's trend line".

Can you elaborate on "improper RSI" for a recovery? MACD seemed OK, imho, though.

https://bitcointalk.org/index.php?topic=489756.0

[oda.krell]

downtrend already broken?  that is absolutely ludicrous

*February* downtrend. Almost certainly, yes. Whether the bigger downtrend is about to reverse or not is the open question IMO.

[Sindelar1938]

I think the mkt will snap back really hard next week

[Rawted]

We will most likely hover between 500-700 during March.

[oda.krell]

Short-term update.

Bullish pennant, anyone? (EDIT: "bullish", because continuation of previous upwards move predicted by this pattern)



Guess we'll see within the coming days. If we continue the sideways dance a bit longer, I see a good chance we're going to continue to go up.

At the same time, there seems to be some real fear in the air that the latest upwards move was a "forced" attempt to prematurely end the consolidation, so a major individual move (i.e. a whale dump or buy) could relatively easily break the balance early.

[derpinheimer]

How do you determine that is a bullish pennant rather than bearish?

I would have to say I also believe the push up was manipulated. The way the buys went thru was so similar the entire rally. Buy wall -> move up -> get sold in to. Five or more times? So about 6m USD?

Now we havent seen another whale, so, unless random people come with fiat and decide its time to go up again, I cant see how we will go anywhere but down..

I sure hope it continues up though.

[oda.krell]

How do you determine that is a bullish pennant rather than bearish?

I would have to say I also believe the push up was manipulated. The way the buys went thru was so similar the entire rally. Buy wall -> move up -> get sold in to. Five or more times? So about 6m USD?

Now we havent seen another whale, so, unless random people come with fiat and decide its time to go up again, I cant see how we will go anywhere but down..

I sure hope it continues up though.

It's defined to be a continuation pattern, and since the preceding move (on the same time frame) was very clearly up, it's bullish.

I have argue before in one of Mat's threads that, even though I personally also jumped on the big upwards move rather late, I don't see it as (mainly) manipulation, but rather built up buying pressure being released after some (whale, maybe) first mover got things in motion*. I'm not sure enough of this myself however to want to convince others of this, so you own interpretation is as good as mine.


* I used an analogy of a guy lighting a match in a room full of gun powder. It'd be odd to me to call the resulting explosion the result of "lighting a match", without attributing it to the stockpile of gunpowder at least as much.

[podyx]

I think we are going up purely based on the bearish sentiment and the past april crash pattern alone

The price seem to come and sneak up when u least expect it

[segeln]

Short-term update.
Bullish pennant, anyone? (EDIT: "bullish", because continuation of previous upwards move predicted by this pattern)

I am fond of those short-term and shortsighted updates.
Next will be a candlestick Minute time Intervall update
Yo Sen (bullish) und In Sen (bearish)
 Hammer (bullish) und Hanging Man (bearish)

[oda.krell]

I am fond of those short-term and shortsighted updates.
Next will be a candlestick Minute time Intervall update
Yo Sen (bullish) und In Sen (bearish)
 Hammer (bullish) und Hanging Man (bearish)

Thank you for your valuable critique.

Seriously though, if a daily time frame (based on 15min candles for precision) and the question whether it'll resolve upwards or downwards is too short-termy for your taste, you're probably in the wrong forum and/or currency-slash-investment.

[MatTheCat]

But... but TERA told me we couldn't go above $666? 

 

We would still be in the $500's if it weren't for those rounds of 3K strong buy-in walls.

Nobody can account for this sort of erratic action from a very deep pocket source that came right in out of few. Since Monday, market has went back to condition it was in. No volume  except traders and exchange bots, slowly grinding down until some 'event' happens to kick its arse in one direction or the other.

[oda.krell]

But... but TERA told me we couldn't go above $666? 

 

We would still be in the $500's if it weren't for those rounds of 3K strong buy-in walls.

Nobody can account for this sort of erratic action from a very deep pocket source that came right in out of few. Since Monday, market has went back to condition it was in. No volume  except traders and exchange bots, slowly grinding down until some 'event' happens to kick its arse in one direction or the other.

Since you keep harping on about that point, I shall do the same about mine: That "whale" didn't do anything that wouldn't have happened anyway. He was just slightly faster than the big pile of smaller traders.

I've already used (and overused) the "match blowing up a room full of gunpowder" analogy, so here's another one: go back 5 days and ask in here "is the bottom in, yes or no?". You know the answer to that hypothetical question as well as I do: A mumbly "yes, but probably we're still not going up yet". Well, guess what -- once a sufficient number of people believe the bottom is in, there's only one way left: up.

That it happened faster and more violently than expected is thanks to our friendly whale, but I don't see a reason to question the direction we're in altogether as a result.

[EvilPanda]

But... but TERA told me we couldn't go above $666? 

 

We would still be in the $500's if it weren't for those rounds of 3K strong buy-in walls.

We would be in the $700's if it weren't for that incompetent Karpeles - fat thief.

[segeln]

I am fond of those short-term and shortsighted updates.
Next will be a candlestick Minute time Intervall update
Yo Sen (bullish) und In Sen (bearish)
 Hammer (bullish) und Hanging Man (bearish)

Seriously though, if a daily time frame (based on 15min candles for precision) and the question whether it'll resolve upwards or downwards is too short-termy for your taste, you're probably in the wrong forum and/or currency-slash-investment.

short term and short sighted: to miss the forest for the trees

[porcupine87]

Noone seems to be intereted. But we had the exact same pattern when we hit the 600$ one week ago. Because the rise was so quickly, there war not resistence at 600$. After correction the resistence at 600$ was building up and it was hard to beat. How did we come to the 700$? Did we come over 700$? Was happend next?

[MatTheCat]

Well, guess what -- once a sufficient number of people believe the bottom is in, there's only one way left: up.

That it happened faster and more violently than expected is thanks to our friendly whale, but I don't see a reason to question the direction we're in altogether as a result.

Well guess what, a lot of people believed that lower lows were around the corner. I wasn't one of them but did believe in a much stronger correction than to just $535. The market was not moving. Holders of Bitcoin unwilling to sell at mid $500s, buyers unwilling to buy. If Bitcoin isn't going to increase in value, then it will be sold as most people have no use for it other than as a means of wealth accumulation. As things turned out, the whale came out of knowhere and triggered a mad buying surge and I got my ass spanked with short sell that I came out of much too late.....Still had great profiting opportunity on surge North....but managed to cut my own throat to the tune of 50% less profit on that one as well. I am a shite trader. I need to get a good buying point and just fkn hold.

Now we are back where we were in terms of market stagnation, except a a whole $100 higher up the ladder. Now we don't need to correct back to upper $400's lower $500s, but upper $500's /lower $600's. Either that or have another whale come to market.

[bitcoinlitcoinbtcltc]

Hey,

I don't think this is a 'legitimate' uptrend.
I haven't been following the other exchanges closely except for BTC-e, but I have compared the buy and sell orders.
When LTC was rising, and even now, the buy orders didn't increase. They DECREASED. If we were in an uptrend, more people would have bought, but it seems people cancelled their buy orders to wait it out.

On the other hand, the sell orders DID increase. At the moment, sell orders for LTC are around 11-12 million, while the buy orders are around 5 million. People will sell faster than that they will buy.

The reason for the rise?

LTC: BTC China adding Litecoin. Why this caused a rise, I don't know. Everyone was shouting ''China doesn't matter anymore'' (after the ban). But it suddenly matters again when it is about ''positive crypto news'' ? The LTC market is heavily manipulated at the moment.

Bitcoin probably rose because of Blockchain's twitter message; ''huge news coming, exciting weekend.''

Turned out, the news wasn't that exciting at all.

I don't think we have reversed yet, and to be honest, it doesn't seem like we will REALLY reverse anytime soon.

But it is an unpredictable market, so I guess we'll just have to wait and see.

Cryptotrading is, after all, influenced by a few whales. What we, as individual ''small'' traders do, doesn't really matter.

[Yololintian]

I'm uneasy about those ask walls on BFX totaling like 10k+ btc from $693-705...

[SkRRJyTC]

I'm uneasy about those ask walls on BFX totaling like 10k+ btc from $693-705...

I believe anyone can make a wall like that on BFX

[sgbett]

...there seems to be some real fear in the air that the latest upwards move was ....

...and thus it probably wasn't.

[MAbtc]

I'm uneasy about those ask walls on BFX totaling like 10k+ btc from $693-705...

LOL Bitfinex. Almost 14k to 705.

Just shorts trying to scare the market down and keep BFX from driving Stamp up. What I'd like to know is if the 700 walls are real on Stamp. Short 690-695 / Stop 703 looks pretty tasty right now. But it might just get yanked and lose me a quick $1k (+ slippage when all the BFX walls get yanked)...

Either way, starting to feel like we need to push up a bit before any break to the downside. No one selling into support at these levels. But on a failed retest to the upside? $13 million in BFX longs and all the bagholders from $700+ on the 3/3 spike may start feeling the squeeze then.

It's a roller coaster!

[googlemaster1]

You have a lot of people in this for the long haul, and a lot of people who look at "Bitcoin crashing" as a sale on bitcoin.  I for one put two huge buy orders in around the $430 mark and was sitting in front of my computer on the spike to 710.  Did I sell?  No, because I rather hold BTC than fiat, and hopefully more and more people will feel the same way. 

In order for a true trend reversal people have got to WANT bitcoin; want to spend it, want to hold it, want to use it, and not use it in order to score FIAT off of the trading system.  When I trade on exchanges, I trade to get BTC, I could care less about what my FIAT net worth is at the end of the day, although the current rate of adoption/demand seems to be barely keeping pace with the trickling supply that gets put into the system.  (most larger mining companies are only selling what they need to in order to survive)

[TERA]

You have a lot of people in this for the long haul, and a lot of people who look at "Bitcoin crashing" as a sale on bitcoin.  I for one put two huge buy orders in around the $430 mark and was sitting in front of my computer on the spike to 710.  Did I sell?  No, because I rather hold BTC than fiat, and hopefully more and more people will feel the same way.  

During bull markets when longer technical indicators start to reverse, I switch my selling strategy. Instead of "selling for fiat" and holding fiat for a prolonged amount of time, I only do very quick "short trades" immediately after spikes when it is clearly overbought, or if some bad news comes out (like silk road) and it's clearly going to spike down. I get in and out in 5 minutes to an hour and don't leave the charts till I am back in. So for example during the spike the other day to $710, I quickly "shorted" (sold and rebought) ,my bitcoins from 710 to 670 and then again from 700 to 650, with about 5-15 minutes in each trade, increasing my coins by about 15%. Then once I'm back in, that's it, I don't sell again. I don't speculate that maybe it will also go from 650 to 610. Sure that might happen and I be "down" for a little while when it goes from 650 to 610 but that's simply too unpredictable, slow, and risky of a thing to speculate on, when I can do just fine by grabbing low hanging fruit instead.

[bassclef]

My take (I'm new, be kind)...

6 hour chart to put the February downtrend into perspective. Reverse head & shoulders and subsequent reversal as predicted by EMA cluster just below the neckline. The bullish breakout didn't bounce off the neckline as support, confirming its strength.

Now we approach the 120 day EMA, which we have been trading underneath since early February. This is the longest period of time that we've traded below it, no doubt due to the loss in confidence from Gox. We are at a critical point and just about to move above it.

My vote is for up.

[TERA]

It's too early to go up though. It should take 2 weeks to break the 3 month downtrend. It would look REALLY akward on the chart if went up right now.

[Vigil]

It's too early to go up though. It should take 2 weeks to break the 3 month downtrend. It would look REALLY akward on the chart if went up right now.

Look at the one-day chart though... is that just going to make a hard turn the other direction? It looks like it is headed upward.

[TERA]

To form a proper base for an upward breakout from the 3 month downtrend, it should do something like this, as it did last year.


(12 hour chart)

We're talking about THE breakout of the 2014 consolidation into the rally for the next bubble. This doesn't just happen off the cuff with a 3 day retracement after a 75% rise from the bottom which was a mere week ago.

[Yololintian]

It's too early to go up though. It should take 2 weeks to break the 3 month downtrend. It would look REALLY akward on the chart if went up right now.

It already does look really awkward with the rise on 3/3 initiated by the whale that wanted 5k btc.

[theonewhowaskazu]

Remember that one big green bar that happened a couple of days ago? The one from below 600 to a high of over 700? We're going to need to retrace to the bottom of that (or at least the open) before we can break out. This process will probably take 1-2 weeks. Thats not to say we couldn't see $70X for a period of time, but it will be like all the other $70X booms thus far: Short lived. Until other's get to re-confirm that the whale that got us from sub $600 to $700 was correct, that is. After that correction, its to the moon.

[TERA]

It's too early to go up though. It should take 2 weeks to break the 3 month downtrend. It would look REALLY akward on the chart if went up right now.

It already does look really awkward with the rise on 3/3 initiated by the whale that wanted 5k btc.

The quick rise is due to the quick fall. I didn't like it at first but now I realize it was legit. Everything is symmetrical, and the rise out of the next downtrend should be symmetrical too. Since it was a longer fall, it will be a longer rise.

[Yololintian]

It's too early to go up though. It should take 2 weeks to break the 3 month downtrend. It would look REALLY akward on the chart if went up right now.

It already does look really awkward with the rise on 3/3 initiated by the whale that wanted 5k btc.

The quick rise is due to the quick fall. I didn't like it at first but now I realize it was legit. Everything is symmetrical, and the rise out of the next downtrend should be symmetrical too. Since it was a longer fall, it will be a longer rise.

I also can't see anything happening too fast from this point. But I don't think the quick rise was due to the quick fall at all. The quick fall to 400 was succeeded by a quick rise to 550s; the unusual $100+ increase in a few hours on 3/3 was not symmetric to anything and was pretty unusual.

[googlemaster1]

It's too early to go up though. It should take 2 weeks to break the 3 month downtrend. It would look REALLY akward on the chart if went up right now.

It already does look really awkward with the rise on 3/3 initiated by the whale that wanted 5k btc.

The quick rise is due to the quick fall. I didn't like it at first but now I realize it was legit. Everything is symmetrical, and the rise out of the next downtrend should be symmetrical too. Since it was a longer fall, it will be a longer rise.

I also can't see anything happening too fast from this point. But I don't think the quick rise was due to the quick fall at all. The quick fall to 400 was succeeded by a quick rise to 550s; the unusual $100+ increase in a few hours on 3/3 was not symmetric to anything and was pretty unusual.

I feel like the BTC Market has to be a little different than standard graph reading.  When you take into account trading hours are 24/7, what about a general aggregate timeframe when whales are awake?  What about a savvy investor just waiting to pounce?  The return to 550 after a 400 tap didn't surprise me at all.  There have always been huge 30% rebounds after testing the bottom in these flash crashes.  Most everyone is willing to buy a bitcoin at 4xx, but at lot of us were trying to catch the bottom of the trampoline, as shown with previous flash crashes, they are followed by a rebound with the same velocity.  See Dec. 17 Crash for example.

[TERA]

Here's another way to analyze the resistance we need to break before the bear market is officially over - this purple shit.

[porcupine87]

Here's another way to analyze the resistance we need to break before the bear market is officially over - this purple shit.

What are these line? I am interested in the red line  
So the down trend was over in August?

I want to learn TA, ok. But which period time do I use? Take the weekly chart on bitcoinwisdom, and you will see, we are in an up trend since Jan13. Take the 12h period and we are already in an up trend since a few days.
This seems to be just a matter, what period interval I take...

[TERA]

That's the ichimoku cloud on the 1 day timeframe. However, it's just a passing thought and I'm not sure if it's actually significant. The indicator I'm actually using before I increase to max position is the 3 day MACD.

[Ibian]

Ichimoku sounds like some pagan god. Can't believe that's an actual trader term.

[segeln]

http://www.godmode-trader.de/analyse/bitcoins-totgesagte-leben-laenger,3679751
In dieser charttechnischen Besprechung betrachten wir nun den Kurs der Bitcoins an der Börse Bitstamp. Dort konnte sich der Kurs im Februar oberhalb von 500 $ stabilisieren, ein Ausbruchsversuch nach unten hin wurde sofort wieder aufgefangen. In dieser Woche kommt Kaufdruck auf, die Preise werden bis an die primäre Abwärtstrendlinie seit November hinaufgezogen. Mit dem Februartief am Unterstützungsbereich bei 360 - 400 $ wurde das Dezembertief erfolgreich getestet, womit die komplette Seitwärtskorrektur seit November enden könnte. Für klare Signale fehlt aber noch ein letzter Impuls: Erst ein nachhaltiger Anstieg über 760 $ würde weiter steigende Kurse bis 1.150 - 1.200 und später ca. 2.200 $ zulassen.

Kippt die Stimmung wieder mit Kursen signifikant unterhalb von 490 $ per Tagesschluss, sollte ein weiterer Test des Unterstützungsbereichs bei 360 - 400 $ eingeplant werden. Unterhalb davon liegt bei 250 - 270 $ der nächste Auffangbereich für Kursrücksetzer.


http://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:ichimoku_cloud

[Dalmar]

^ Why are you posting in German on an international forum?

[TERA]

Because there's nothing he could say in English to convince me that we're just suddenly going to break out right now and have a single rally all the way to ATH and beyond in less than a month. "godmode trader" has spoken.

[oda.krell]

To form a proper base for an upward breakout from the 3 month downtrend, it should do something like this, as it did last year.

[...]
(12 hour chart)

We're talking about THE breakout of the 2014 consolidation into the rally for the next bubble. This doesn't just happen off the cuff with a 3 day retracement after a 75% rise from the bottom which was a mere week ago.

I'm not that sure about the bolded part. If your expectations about what a possible breakout would have to look like are based on the assumption that the breakout would be followed (more or less) by the next rally phase (EDIT: towards a new ATH) , I don't know if I see that assumption to be all that certain.

There continues to be a worrying picture in my head where we are now in the stage where we were in early May 2013: after the *first*, not the *last* post-ATH bearish/correctional curve. I'll see if I can whip up a picture of what I mean later today.

Anyway: if that's the case, and we're playing out the April 2013 correction, but slowed by a factor of ~2, then to me it'd make sense to "break out" now without a more solid base/retest of lower levels.

[TERA]

To form a proper base for an upward breakout from the 3 month downtrend, it should do something like this, as it did last year.

[...]
(12 hour chart)

We're talking about THE breakout of the 2014 consolidation into the rally for the next bubble. This doesn't just happen off the cuff with a 3 day retracement after a 75% rise from the bottom which was a mere week ago.

I'm not that sure about the bolded part. If your expectations about what a possible breakout would have to look like are based on the assumption that the breakout would be followed (more or less) by the next rally phase (EDIT: towards a new ATH) , I don't know if I see that assumption to be all that certain.

There continues to be a worrying picture in my head where we are now in the stage where we were in early May 2013: after the *first*, not the *last* post-ATH bearish/correctional curve. I'll see if I can whip up a picture of what I mean later today.

Anyway: if that's the case, and we're playing out the April 2013 correction, but slowed by a factor of ~2, then to me it'd make sense to "break out" now without a more solid base/retest of lower levels.

If you look at page 1 of this thread, then I have posted a chart about just this.

[oda.krell]

To form a proper base for an upward breakout from the 3 month downtrend, it should do something like this, as it did last year.

[...]
(12 hour chart)

We're talking about THE breakout of the 2014 consolidation into the rally for the next bubble. This doesn't just happen off the cuff with a 3 day retracement after a 75% rise from the bottom which was a mere week ago.

I'm not that sure about the bolded part. If your expectations about what a possible breakout would have to look like are based on the assumption that the breakout would be followed (more or less) by the next rally phase (EDIT: towards a new ATH) , I don't know if I see that assumption to be all that certain.

There continues to be a worrying picture in my head where we are now in the stage where we were in early May 2013: after the *first*, not the *last* post-ATH bearish/correctional curve. I'll see if I can whip up a picture of what I mean later today.

Anyway: if that's the case, and we're playing out the April 2013 correction, but slowed by a factor of ~2, then to me it'd make sense to "break out" now without a more solid base/retest of lower levels.

If you look at page 1 of this thread, then I have posted a chart about just this.

Haha, I see what you're getting at with that chart now. Sorry, but when I first saw it I couldn't make any sense of it, bit too chaotic with the squiggles and stuff. Anyway, I'm not claiming the idea is mine, or even that new. For exampple, it's similar to what masterluc said pretty much immediately after the December double top. In his case, it was (to my knowledge) based on counts following EW theory, which I'm pretty skeptical about, but in either case, it looks like it's a thought a number of us have in their head. Not sure it'll play out like that though: for instance, Fibonacci levels paint a very different picture (we are now where we were at the peak of the last corrective wave in 2013). 

[TERA]

I have my doubts about february being "final capitulation", because it was short, was all panic and event/news driven, and ended with a flash and bang - a VERY sharp recovery. This was very much like a "second drop" or the drop to 78 in april. A final capitulation or "third drop", on the other hand, should be very slow, hopeless, not news-driven, and slowly scoop into and dig its way out of a support level with a very low RSI and several consecutive days of high volume.

[MatTheCat]

Because there's nothing he could say in English to convince me that we're just suddenly going to break out right now and have a single rally all the way to ATH and beyond in less than a month. "godmode trader" has spoken.

But godmode trader said that we might break out above $760, in which case prices upwards of $1100 etc were possible.......but if we broke below $490, then we could go down as far as $200s.

This isn't god mode trading. This is drawing lines on a fucking graph and saying the points where major trendlines hit.

The quick rise is due to the quick fall. I didn't like it at first but now I realize it was legit. Everything is symmetrical, and the rise out of the next downtrend should be symmetrical too. Since it was a longer fall, it will be a longer rise.

Cmon man. Did you see how it happened? We are talking some individual placing 3K strong buy-in tranches right at spot price on Stamp here, resulting in panic buy-ins jumping in front of him, resulting in him moving his bid up further, and so on. This was a massive panic buy-in from likely from one source, that triggered a market stampede.

I have my doubts about february being "final capitulation", because it was short, was all panic and event/news driven, and ended with a flash and bang - a VERY sharp recovery. This was very much like a "second drop" or the drop to 78 in april. A final capitulation or "third drop", on the other hand, should be very slow, hopeless, not news-driven, and slowly scoop into and dig its way out of a support level with a very low RSI and several consecutive days of high volume.

I also think we will see lower lows than $400. Just not quite yet.

With all the negative publicity and the known stolen coin hoardes, saving for capital flight from an economic crisis, there will be a general lack of upward pressure in Bitcoin with every opportunity for massive dumps (stolen coins) to spring out of knowhere.

So Bitcoiners, keep your fingers crossed for war, economic meltdown (but only in silly little countries that don't matter otherwise our beloved ponzi scheme is toast), and human misery!

[TERA]

* tera enters trading god-mode. buys at $200 and sells at $2500 within one month *

[oda.krell]

Alright, let's try something different. I'm going to zoom out a bit, because (I'm sure you will agree) it's pretty difficult to read the market right now.

(cue Mat "manipulative whale whores everywhere, cannot trust this price, ramble ramble".)

Note that I'm smoothing out the details in the following one. Median price instead of candles. 30 day EMA as the comparative baseline. I want to look at the bigger picture for a moment, okay?





Looking at it like that, it doesn't sound completely unreasonable to me to ask "are we playing out a similar post-bubble correction like in 2013, and are we at the end of it?".

The similarities: red circle is the "Oh fuck. The rally is really over, after all" phase. Suddenly there's almost no hope left (except for permabulls) that we're breaking through the top again. Predictably, then comes the flash crash.

Next, we go back above the 30d EMA. Sentiment: "Hey, maybe this time the recovery will be done much quicker! Look, we already found the bottom last week!". Nope. It's never over that quick. Orange circle follows.

Which is where we are now. Maybe. Let's say we are, for a second.

So what would we expect to see in that case? Looking back to July/August 2013, let's note first that there's plenty of room for indecision reflected in the price. We actually went below the 30d EMA for another week. But eventually, it'll have to stay above... no need for huge jumps at first, but we do need to stay above that baseline at some point, or it's going to look like the correction will drag on.

In analogy with 2013, I'd say (raw) price briefly dipping back to 600 is still okay, but if it's going back below 580 then it's probably a lost cause. Also, any of those visits below the EMA should be over in about a week, maybe two, otherwise the similarities to 2013 pretty much end there.
EDIT: Correction. Forgot about the dump on July 18 that took out 60% of the gains we made since the capitulation. Analogous would be staying above 520 now.

One thing: don't come in here shouting "what reversal, we're still firmly in a downtrend", please. Think of the above as a hypothetical question in if/then form: if we are indeed in a recovery situation similar to July 2013, what would we expect to see in the next week or two.

[Ibian]

I like bigger pictures. Easier to tell what I'm looking at.

Someone posted a chart a while back mirroring the last bubble with the one we are in now. Almost perfect mirror match, and if so the next rally should start in the middle of this month. Anyone know the one? Repost if so?

[bassclef]

Here's my take. We're gonna need a bigger track

[JustAnotherSheep]

I like bigger pictures. Easier to tell what I'm looking at.

Someone posted a chart a while back mirroring the last bubble with the one we are in now. Almost perfect mirror match, and if so the next rally should start in the middle of this month. Anyone know the one? Repost if so?

No idea if you meant my post in lucif's thread, probably not lol but anyway

Seems to me a drop to SMA200 on Stamp is getting more likely. Support line of the triangle has been slightly pierced, price is persistently staying there and the candles are getting more squeezed. Given the insignificant distance I suspect a downwards breakout would carry enough momentum to at least short term pierce SMA200 as well, possibly towards bottom or close to it as a repeat of April post-crash patterns.

Would love if some more competent analyst could confirm with actual TA and not just this nonsense

edit: Pic for clearer conveyance of meaning

Price did quickly pierce SMA200 with a bounce near floor, just as predicted and just as it happened in the April crash. Historic comparative analysis has served me extremely well in the past, so I wouldn't be surprised if it holds now too (meaning bear market should be over). However luc recently made a post pointing out a potential inverted cup n' handle pattern, so I'm not betting on any horses yet

[FeedbackLoop]

Isn't there a bullish flag forming since March in the daily?

Just trying to throw 2 Finneys at this thread.

[oda.krell]

Isn't there a bullish flag forming since March in the daily?

Just trying to throw 2 Finneys at this thread.

Not sure if you're serious or poking fun at my (continuation of uptrend = bullish) pennant post some days ago, but in principle you could still argued for the pattern still being there:



But tbh, I don't see it as the most likely scenario either anymore.

[FeedbackLoop]

heh!

Sorry didn't see that. Thanks for the nice update on the figure!
 

[sgbett]

Alright, let's try something different. I'm going to zoom out a bit, because (I'm sure you will agree) it's pretty difficult to read the market right now.

(cue Mat "manipulative whale whores everywhere, cannot trust this price, ramble ramble".)

Note that I'm smoothing out the details in the following one. Median price instead of candles. 30 day EMA as the comparative baseline. I want to look at the bigger picture for a moment, okay?





Looking at it like that, it doesn't sound completely unreasonable to me to ask "are we playing out a similar post-bubble correction like in 2013, and are we at the end of it?".

The similarities: red circle is the "Oh fuck. The rally is really over, after all" phase. Suddenly there's almost no hope left (except for permabulls) that we're breaking through the top again. Predictably, then comes the flash crash.

Next, we go back above the 30d EMA. Sentiment: "Hey, maybe this time the recovery will be done much quicker! Look, we already found the bottom last week!". Nope. It's never over that quick. Orange circle follows.

Which is where we are now. Maybe. Let's say we are, for a second.

So what would we expect to see in that case? Looking back to July/August 2013, let's note first that there's plenty of room for indecision reflected in the price. We actually went below the 30d EMA for another week. But eventually, it'll have to stay above... no need for huge jumps at first, but we do need to stay above that baseline at some point, or it's going to look like the correction will drag on.

In analogy with 2013, I'd say (raw) price briefly dipping back to 600 is still okay, but if it's going back below 580 then it's probably a lost cause. Also, any of those visits below the EMA should be over in about a week, maybe two, otherwise the similarities to 2013 pretty much end there.
EDIT: Correction. Forgot about the dump on July 18 that took out 60% of the gains we made since the capitulation. Analogous would be staying above 520 now.

One thing: don't come in here shouting "what reversal, we're still firmly in a downtrend", please. Think of the above as a hypothetical question in if/then form: if we are indeed in a recovery situation similar to July 2013, what would we expect to see in the next week or two.

I like that chart a lot, because it looks like a graph of human psychology, and in bitcoin that's still really relevant (imho).

So I have nothing to add! Every day goes by it feels like this bottom was already in. I'm happy with the coins I bought in the 500s, and that is something I could never have imagined myself saying last year. In fact I recall specifically deciding against buying on the crash from $266 to under a hundred, because I just couldn't get my head around pay $90 for ONE bitcoin.

[Bitcoin_is_here_to_stay]

Love "fool's trend line".

Can you elaborate on "improper RSI" for a recovery? MACD seemed OK, imho, though.

https://bitcointalk.org/index.php?topic=489756.0

Thanks, very interesting info and informative thread

[oda.krell]

I like that chart a lot, because it looks like a graph of human psychology, and in bitcoin that's still really relevant (imho).

So I have nothing to add! Every day goes by it feels like this bottom was already in. I'm happy with the coins I bought in the 500s, and that is something I could never have imagined myself saying last year. In fact I recall specifically deciding against buying on the crash from $266 to under a hundred, because I just couldn't get my head around pay $90 for ONE bitcoin.

Wish I had your optimism. I guess I can see some positive signs (other than that we're not trading near 500 again, of course), like a CMF recovery similar to the one in July 2013 (see chart 1), but on the other hand I really wish the 630-640 (24% retracement) area would start providing support finally (chart 2). So far, it seems that we touch back into and below it without much effort... and that's how the long slide down started from Jan 7 to 14 as well (same fibo level, not same price level of course).

I lost my appetite for trading a bit right now, so I'm sitting on my hands anyway, but in my view we have about one more week to decide whether we're staying above the next retracement level for good (i.e. we don't dip back below 630/640), and if and when that happens, I'm going to be a bit more optimistic.

We also have that looming December-to-now trendline (chart 3), and we'll have to figure out eventually if that one turns out to be still active... if the resistance at around 650 keeps throwing us back down, I might start betting on a continuation of the downtrend/consolidation after all.



(1)




(2)



(3)




EDIT: I guess there's another positive view on our current situation, if you look at the retracement steps from the January peak to the recent 400 bottom. The 24% level was taken back almost immediately, and the most recent jump to 700 solidly put us up one level higher (38%, above 627, where we stayed for most of the time since the jump up). The next level, 50%, at around 700, will have to fall eventually, and I have no way of telling if the upwards pressure is strong enough for that, but I'm just mentioning all of this because previously I only looked at the retracement levels of the latest uptrend, but never looked at it from the perspective of the 995 to 400 downtrend.

[lebing]

Here's my take. We're gonna need a bigger track

Interesting, thanks.

[oda.krell]

The plot thickens. Triangle closing, or maybe broken already to the downside. I don't think we're going to break through the December downtrend this weekend, but if whatever dip we might see over the weekend doesn't take us below ~600 I can see a continuation like shown below for the next week to 10 days, where we finally break through the LT downtrend and have a retest of 700. CMF, order book, even bitfinex stats all look pretty good, there's just not enough momentum, and we're a bit too overbought, to go through it *right* now.

[arepo]

The plot thickens. Triangle closing, or maybe broken already to the downside. I don't think we're going to break through the December downtrend this weekend, but if whatever dip we might see over the weekend doesn't take us below ~600 I can see a continuation like shown below for the next week to 10 days, where we finally break through the LT downtrend and have a retest of 700. CMF, order book, even bitfinex stats all look pretty good, there's just not enough momentum, and we're a bit too overbought, to go through it *right* now.

by my figure, this isn't a proper triangle consolidation pattern because the drawn resistance doesn't have enough points of contact. this looks much more like a micro-bubble started by the large movement up to $710. i expect a relatively sharp movement down to mirror the movement up, retracing at least 61.8% of the way back down to the $530 support, which confirms your target at the $600 support.

we shall see...

--arepo

[oda.krell]

The plot thickens. Triangle closing, or maybe broken already to the downside. I don't think we're going to break through the December downtrend this weekend, but if whatever dip we might see over the weekend doesn't take us below ~600 I can see a continuation like shown below for the next week to 10 days, where we finally break through the LT downtrend and have a retest of 700. CMF, order book, even bitfinex stats all look pretty good, there's just not enough momentum, and we're a bit too overbought, to go through it *right* now.

by my figure, this isn't a proper triangle consolidation pattern because the drawn resistance doesn't have enough points of contact. this looks much more like a micro-bubble started by the large movement up to $710. i expect a relatively sharp movement down to mirror the movement up, retracing at least 61.8% of the way back down to the $530 support, which confirms your target at the $600 support.

we shall see...

--arepo

That's the December downtrend I (and many others) have been going on about forever... I didn't zoom out far enough to show the (3 to 4) points of contact because I assumed by now everyone agrees that it is a valid trend (even though it might be undecided how much staying power it has).




EDIT: I just re-read my post. you're right, since I didn't mention it is the December downtrend, it was misleading. My mistake.

[arepo]

EDIT: I just re-read my post. you're right, since I didn't mention it is the December downtrend, it was misleading. My mistake.

no worries. i realized shortly after that post that on the 1-week scale this figure does indeed look like its own triangle consolidation pattern, and mentioned the model in an update in the newsletter thread, as it does agree with the other data

--arepo

[oda.krell]

What if I told you...

(Morpheus meme)

... we already broke the December downtrend, but nobody noticed it.




Yes, that's median price, not candles. Deal with it. Also, don't read too much into it, I know I don't. Just the byproduct of my fumbling attempts to see the similarities and differences between this bubble cycle and the ones before. For example, I noticed that the idea that at the end of the initial post peak downtrend we must immediately see signs for a clear uptrend became somewhat fixated in my mind. Perhaps a mistake.

[seleme]

You love changing thread title, don't you?  

Anyway, I'm due for some bubble really, I need some adrenaline  

My little daughter asked me some questions about our new house today, her plans for ner new rooms etc., I hope that is a sign  

[oda.krell]

You love changing thread title, don't you?  

Anyway, I'm due for some bubble really, I need some adrenaline  

My little daughter asked me some questions about our new house today, her plans for ner new rooms etc., I hope that is a sign  

Damn you for calling out my clever ruse to trick people into thinking something new (and of value) has been posted. *shakes fist*

[seleme]

You love changing thread title, don't you?  

Anyway, I'm due for some bubble really, I need some adrenaline  

My little daughter asked me some questions about our new house today, her plans for ner new rooms etc., I hope that is a sign  

Damn you for calling out my clever ruse to trick people into thinking something new (and of value) has been posted. *shakes fist*

Haha, you do trick me for a second, then I check who is OP and figure it out

[segeln]

Because there's nothing he could say in English to convince me that we're just suddenly going to break out right now and have a single rally all the way to ATH and beyond in less than a month. "godmode trader" has spoken.

But godmode trader said that we might break out above $760, in which case prices upwards of $1100 etc were possible.......but if we broke below $490, then we could go down as far as $200s.

This isn't god mode trading. This is drawing lines on a fucking graph and saying the points where major trendlines hit.

OMG,MatTheCat`s translationon of the godmodetrader text ist teribble wrong.And so he did`nt get the issue
But he is sure an expert on TA.

TERA wrote on March 6.:

that we're just suddenly going to break out right now and have a single rally all the way to ATH and beyond in less than a month.

Well ,I mark the date and will see the ATH as predicted in  a fortnight.
Up to now it doesn`t seem to become true though.
But when experts are saying this..I will Close my mouth. But this does`nt prevent me from ROTFLOL

[oda.krell]

A note on volume

Seems to be a common complaint right now: "volume is just too low", "back in 2013 the reversal had much better volume". I'm not so sure about that. Let's see...

Excluding the day of the bottom itself (I'm leaving it out because I am interested in the "post bottom" volume), we have 20 days to look at. So I'm looking at 26.02.-17.03 for the current period. Same (post bottom) period in 2013 is 06.07.-25.07. Here's a visual of the time period I'm talking about:






Now, volume data (via btccharts). I'm summing over Mtgox, Bitstamp and btc-e in 2013, and Bitstamp and btc-e in 2014. Note that I'm ignoring Chinese exchanges entirely, which contribute a lot more volume today than back then, which works against my own case. (but tbh, I simply don't trust their volume can be taken at face value).

06.07.-25.07.2013
Mtgox: 57.3M USD
Stamp: 21.3M USD
btce: 8.4M
= 87M USD

26.02.-17.03.2014
203.5M USD
114.2M USD
= 318M USD

That's volume in USD, alright. Has to be, as that's the only meaningful way to compare volume across eras with vastly difference prices.

Volume in dollar:
318M:87M = 3.7:1

So, $volume is 3.7 times higher now than it was in the same "reversal" period in 2013.

Now, to mention this as well, price now is ~640 USD, back then it was ~90:
640:90 = 7.1:1

Summary: we trade at a price around 7 times higher per coin right now than back then, and are seeing about 3.7 times as much volume in USD compared to 2013. Keep in mind that expecting the relation between volume and price to be 1:1 a constant is most likely wrong, so based on volume alone I don't see a reason to question the trend reversal.

[Rawted]

We will most likely hover between 500-700 during March.

[oda.krell]

Money flow: 2013 vs 2014

To some (most?), the following will be stating the obvious: we are very clearly not going through a trend reversal period that could mark the end of the bear market we've seen since December 2013. Others already pointed out the large bearish triangle we're still in, but here's confirmation of the claim above by eyeballing price rate of change and money flow. It seems pretty obvious that the period we're in right now (blue ellipse in the second graph) looks nothing like the reversal period of 2013 (green ellipse), while it shares some similarities with the last leg of the 2013 bear market (red circle).

There's of course an optimistic twist to it, if you wish to see it like that: We're not quite there yet perhaps, but the current "leaking of money" the market is seeing (the deeply negative CMF) is similar to the end of the 2013 bear period, so it's possible we're going through the last leg of the downtrend right now.

To paraphrase: We can pretty conclusively say now that all signs of a trend reversal, that we maybe saw in early March 2014, are thoroughly disproven right now. Of course, if your personal risk profile allows it, and you want to make absolutely sure to not miss the bottom, you might be tempted to buy in now, but if your strategy is to wait for confirmation that the trend turned around, then now is most certainly not the time.







Volume/price ratio: 2013 vs. 2014

Here's the same calculation I did a few posts above, relating $volume and price. The idea is to compare volume and price during the 2013 reversal month compared to volume/price during the most recent 30 days.

07.07.-07.08. (32 days)
$Volume Mtgox: 80M USD
$Volume Bitstamp: 31M USD
$Volume Btce: 12M USD
$Volume Sum: 123M USD
Price range, daily median: 70-98 USD

28.02.-31.03. (32 days)
$Volume Bitstamp: 298M USD
$Volume Btce: 142M USD
$Volume Sum: 440M USD
Price range, 30d EMAdaily median: 460-670 USD

$Volume Ratio now:previous = 3.6:1

Price Ratio now:previous =  6.6:1-6.8:1

Volume ratio applied 1:1 to previous price = 252-353 USD (in contrast: current 30d EMA = 580 USD, current intraday median = 462 USD)

Conclusions: $volume on the big Western exchanges is about 3.6 times higher than it was in July 2013 (the "reversal month"), the value didn't change much since I last calculated it. Price is dropping however (duh), and is now only 6.6 to 6.8 times higher than back then.

Applying the volume ratio 1:1 to the 2013 period price, we get a target price for our current period between 252 and 353 USD.

Keep in mind what I already wrote the previous time when I made this calculation: I'm skeptical that the relation between $volume and (stable) price is as simple as 1:1, so the target value is a very crude approximation of what could be a price supported by current volume.

In addition, I completely ignore Chinese volume. I continue to believe that there's good reason to do so: zero fee exchange volume cannot be directly compared to volume on the Western exchanges with non-zero fees, and more importantly I believe Western market participants don't fully "trust" the signals from China anymore, given that there is real doubt whether China will continue to be able to trade BTC as they did so far in the future.

Here's another way to think of my decision to leave out Chinese volume: It's the price that I expect to be supported by $volume if China would drop out entirely.

Practically, I'd say there's a good chance the trend will reverse before going that low, but I do think that at those target prices I would no longer hesitate to buy in, since they should in principle be supported by current volume while maintaining a stable upwards trend (like they were in 2013).

[JustAnotherSheep]

Looks like the bear triangle (as well as inverted cup and handle?) has finally been validated. Something, something, something.. complete?

[oda.krell]

Looks like the bear triangle (as well as inverted cup and handle?) has finally been validated. Something, something, something.. complete?

Well, if there was any doubt how bearish one should be right now, today gave the answer.

I've been looking for possible low price targets for the past week or so, but I don't really see myself buying in right now at any of them. Almost scary how, with a 4-5 month delay, I start getting the feeling lucif had at the beginning of this downtrend.

[EuroTrash]

Thank you for excellent analysis work.

[JustAnotherSheep]

Well, if there was any doubt how bearish one should be right now, today gave the answer.

I've been looking for possible low price targets for the past week or so, but I don't really see myself buying in right now at any of them. Almost scary how, with a 4-5 month delay, I start getting the feeling lucif had at the beginning of this downtrend.

Haha yeah, I know how you feel. Looks like the ol' clown prophet was right all along

I've been experimenting with arbitrarily shoehorning in the fibonacci retracement tool to predict points of resistance or reversal, based on the observed tendency for price to "subconsciously" adhere to/ping at various fib levels before the 0 level has even been reached, implying that tops and bottoms may be predetermined by some mystical magic market forces, either from the very start of a crash/rally or as a result of price movements while getting to the end point. I call it the "Fibhorn".

You may call this method extremely shoddy, inconclusive and/or laughable, but so far it's given me pretty accurate results, although it's hard to distinguish which prediction will be resistance and which will indicate floor, so I'll obviously have to refine it further for it to be more useful.

Anyway, applying the fibhorn to the current price, 250-266 has come up as a solid result, which is in line with your previous post. Again, I'm not entirely sure if this is going to be the floor or just a point of resistance, but I highly expect it to be either one at any rate.

[oda.krell]

Well, if there was any doubt how bearish one should be right now, today gave the answer.

I've been looking for possible low price targets for the past week or so, but I don't really see myself buying in right now at any of them. Almost scary how, with a 4-5 month delay, I start getting the feeling lucif had at the beginning of this downtrend.

Haha yeah, I know how you feel. Looks like the ol' clown prophet was right all along

I've been experimenting with arbitrarily shoehorning in the fibonacci retracement tool to predict points of resistance or reversal, based on the observed tendency for price to "subconsciously" adhere to/ping at various fib levels before the 0 level has even been reached, implying that tops and bottoms may be predetermined by some mystical magic market forces, either from the very start of a crash/rally or as a result of price movements while getting to the end point. I call it the "Fibhorn".

You may call this method extremely shoddy, inconclusive and/or laughable, but so far it's given me pretty accurate results, although it's hard to distinguish which prediction will be resistance and which will indicate floor, so I'll obviously have to refine it further for it to be more useful.

Anyway, applying the fibhorn to the current price, 250-266 has come up as a solid result, which is in line with your previous post. Again, I'm not entirely sure if this is going to be the floor or just a point of resistance, but I highly expect it to be either one at any rate.

Oh absolutely, that method makes a lot of sense. But I guess it also has lot to do with how often you're willing to trade, and how much you value your night's sleep. What i mean is, there are two ways to go about it:

You can define "weakly" the points of possible resistance, and trade them, but then you can't be shy and must be prepared to sell again if it turns out they won't hold. I.e. you determine the bottom as you trade along. Probably the most profitable way.

Thing is, I'm kind of exhausted of this. I don't want to set price alarms at night, or to interrupt whatever I'm doing to watch the price, and since I can't predict the bottom in a "hard" way, I'll wait it out til the dust settled. Might mean I will miss the absolute bottom by some, and miss out on profit for the in between swings, but as long as I see the larger downtrend still in full swing, I think I'll simply wait... although I admit that once we get near the old ATH, I'll seriously consider buying.

[oda.krell]

Not that I want to take a piss into your beloved bowl of cryptocereals, but considering that I was sceptical during last month's breakout-slash-reversal attempt (even though I ultimately thought it had a real chance for a while), I don't see how this one gets even close to the previous one.



In case you wonder what I mean: orange rectangle is the time frame of reaching and leaving the bottom, red one the aftermath. Currently, it looks like we fail to get anywhere near the March breakout in terms of momentum, and CMF isn't picking up either, hovering in the barely positive region.

The best thing I can say is that some of my favorite short-to-mid term indicators are about to turn bullish unless there's a sharp downturn (daily MACD, Fisher), so for the coming week(s) that spells some upwards potential, but the short term view makes me think this reversal is dead before it even got started.

Opinions?


UPDATE just 3 days later, and the situation looks a lot more pleasing. 6h CMF pulled up with a bit of a delay, to somewhere between 0.4 and 0.5, the highest spike since December, and well above the CMF peak of the March false breakout. A/D also shows a bullish divergence (not pictured below).

The real test for a sustained reversal will be whether we can hold this level, and do so with a bit of volume, but in any case, it looks like this rally might have legs after all.

[oda.krell]

Welcome to another installment of our series "conversations with myself".

Looks like we're at a critical juncture during our little rally. We're fighting for the first retracement level (23%) again, just like in March. This time, it's at ~499.

Right now, we're resting slightly below it, but it's too early to declare it lost in my opinion. The following days will tell if the market feels comfortable trading above 500 or not.

re: volume. Others pointed this out already, but the volume during the recent rise from 340 to 548 didn't look so good (slightly falling volume as we went up), but at least we're currently, in the first few bars after the 548 top, seeing a bit more volume overall than during the anemic March period.

[Bitcoin_is_here_to_stay]

This rally somehow felt very fake to me, more like a pump effort. True, there is more volume now (last day or two), but it spiked when we were falling from the new lows. Right now all big three exchanges (stamp, huobi, btce) are below $500. Not that $1 or $2 will matter in terms of TA, but I think psychologically it is a bad sign. But I am not an expert and not felt like "catching a falling knife" last week, even though it would be extremely profitable

[oda.krell]

This rally somehow felt very fake to me, more like a pump effort. True, there is more volume now (last day or two), but it spiked when we were falling from the new lows. Right now all big three exchanges (stamp, huobi, btce) are below $500. Not that $1 or $2 will matter in terms of TA, but I think psychologically it is a bad sign. But I am not an expert and not felt like "catching a falling knife" last week, even though it would be extremely profitable

I'm not sure I would call it "fake." 340 felt like a fantastic deal to many out there. So did everything between 340 and 420. From there, it's only a small step to buy in successively higher tranches. That's just the momentum.

But we are again in the same situation as before: once the initial enthusiasm about having scooped up those "cheap coins" is over, is there any sustained buying support at the level where we happen to land. And I can honestly say, I'm not sure about that. And so is the market right now, it seems.

[bucktotal]

maybe zoom out a bit... longer-term volume trend (smoothed) seems right on track

[oda.krell]

maybe zoom out a bit... longer-term volume trend (smoothed) seems right on track

I think that's more an artifact of the specific parameters you selected for your volume average than an actual signal. I just tried to recreate it myself, and any other value than 12 (i.e. 12 week volume average) gives a much less clear "upwards slope" at the end.

Here's a slightly more fine-grained picture, but still rather smoothed out (3 period average over 3 day volume). One could argue we're not doing so great with volume this time when compared to 2013, where the "reversal volume" showed clear signs of going up again. But of course it can still pick up this time, once we're more clearly settled at above 500.

[bucktotal]

absolutely. the parameters shape the result and the interpretation.

12 weeks avg was shown above. Your ~1 week (or 10 day) avg is not much different than what you are showing initially.. that is, it could be noise. we don't know yet.

more smoothed values on the weekly... and they all look similar to me so far.

8 weeks


4 weeks


2 weeks

[oda.krell]

absolutely. the parameters shape the result and the interpretation.

12 weeks avg was shown above. Your ~1 week (or 10 day) avg is not much different than what you are showing initially.. that is, it could be noise. we don't know yet.

more smoothed values on the weekly... and they all look similar to me so far.

[...]

I'm trying to see it your way, but I simply can't. Your 8 weeks picture still supports your point, because it clusters the March rally and the April rally together, along with their volume. Your 4 week and 2 week picture on the other hand start resembling the view I presented above: if you treat March and April separate, then it shows that volume was higher during the March breakout attempt than during the one we've seen so far.

Which view is the correct one (cluster, or not), I can't say with certainty.

[bucktotal]

i appreciate you trying, so here's the shorter 2 week average again but outlining the bottoms. seems like its still increasing no? thats what im seeing..

i think its ok the shapes are not identical. Perhaps the impact of misplacing a few hundred thousand coins is reducing the global trading volume and thus adding some noise to the general long-term uptrend in volume.... i think we'll just have to ride it out and check back in a couple weeks, as you suggest.

[Bitcoin_is_here_to_stay]

This rally somehow felt very fake to me, more like a pump effort. True, there is more volume now (last day or two), but it spiked when we were falling from the new lows. Right now all big three exchanges (stamp, huobi, btce) are below $500. Not that $1 or $2 will matter in terms of TA, but I think psychologically it is a bad sign. But I am not an expert and not felt like "catching a falling knife" last week, even though it would be extremely profitable

I'm not sure I would call it "fake." 340 felt like a fantastic deal to many out there. So did everything between 340 and 420. From there, it's only a small step to buy in successively higher tranches. That's just the momentum.

But we are again in the same situation as before: once the initial enthusiasm about having scooped up those "cheap coins" is over, is there any sustained buying support at the level where we happen to land. And I can honestly say, I'm not sure about that. And so is the market right now, it seems.

I did not mean "fake" in the sense artificial, I meant I do not believe it was beginning of the another bull market, it seemed like it will be very transitional. Indeed, CMF was soon in the negative territory again and many other indicators exhibiting downtrend.

[Bitcoin_is_here_to_stay]

i appreciate you trying, so here's the shorter 2 week average again but outlining the bottoms. seems like its still increasing no? thats what im seeing..

i think its ok the shapes are not identical. Perhaps the impact of misplacing a few hundred thousand coins is reducing the global trading volume and thus adding some noise to the general long-term uptrend in volume.... i think we'll just have to ride it out and check back in a couple weeks, as you suggest.

Hmm, I think that the only plot looking really optimistic was the original 12 weeks one. It also shows the correction was much sharper this time - at least the pots are looking this way.


BTW, are you assuming that the blue trendline (?) cannot be broken? How it behaved in 2011? Clearly, if we are about to enter long-term bear market some trendlines have to be broken

[bucktotal]

I'm just plotting data, no assumptions. I showed the 52 week MA because thats where we touched this year. last time, we touched the ~200-250 day MA line, depending on what exchange you're looking at/trading on. fyi, this correction is certainly not sharper than previous ones. in fact, they are getting less sharp each time (2011>2013a>2013b/14).

im just playing devils advocate a bit and trying to show thats it quite ok to go below the exponential trend line for a little while longer. we swung way above it for a while in the double bubble of 2013. And to the point, Volume is a tricky metric to follow in such an illiquid and easily manipulated market. Also, since a sig % of the economy's liquid assets (coins on exchanges) have been in a bit of turmoil lately, volume might not be the most reliable metric at present. A couple things different from last year, i think there is a lot more volume happening off exchanges. Personally, i purchased sig numbers of my new coins directly from a miner during this decline instead of through exchanges. Also, I (and many others) are not trading as much (or at all) because there is no "Mt.Gox of 2012-2013" and times have changed. there are no other good options that i want to leave that kind of volume on exchanges anymore. its time for a bit of a breather and a reset of the ecosystem. No wants to get Goxxed again at btc-e and i certainly dont want to go through the new kyc/aml standards at bitstamp etc, etc. these are just points to consider as confounds to the argument.

of course, i do agree that its important to stay vigilant though, because when trend lines break, thats when our models start changing.

[oda.krell]

I took a picture of what the early reversal phase of 2013 (July) looked like in terms of fibo levels. Note how, similar to now, at first price was zig-zagging around the 23% retracement level (red rectangle) of the initial uptrend (from ~63 to ~100). That was shortly afterwards followed by a big dump that took price down below the 50% level. However, on the 6h chart we closed exactly once below that level, and then began a beautiful, uninterrupted rise to the end (i.e. we made a new post capitulation high). See: green rectangle.

I think it's interesting to observe that volume wasn't particularly impressive during the early stages of that recovery... I can't really call it a divergence, but it also doesn't look confidence inspiring. The price action on the other hand was impressive: over the course of about 11 days we made it through 50%, 38%, 23%, 0% levels with no additional serious retracement down.


What about now? I suspect the following two factors will greatly influence whether we will see the reversal fizzle out again like in March, or whether we're really turning around this time: (a) how much force the downtrend on the 6h scale still has, and (b) how much force the following uptrend on the 6h scale will have.

If we end the 6h downtrend early, say within the next 24 to 48h, then I see a good chance that the following uptrend on the 6h scale will take us above 548 (to a new post capitulation high), which means the situation would look pretty different from March.

If, on the other hand, the 6h downtrend drags out, for another 4 days or so, keeping us near or below 23%, then we could hope for the following uptrend to be unexpectedly strong, taking us to a new high (though I'd consider that less likely), or we could see another anemic uptrend on the 6h scale, like the one from March 12 to 14, after which I'd give it a high chance that we'll see a more dramatic decline shortly afterwards.

[JustAnotherSheep]

I'm not entirely sure we're out of the downtrend yet. The trendline might have been broken, but at the same time this price movement looks very fractal/self-similar to me. The previous 2 major drops have always been marked by a sharp increase directly afterwards, followed by a slowly stagnating price for a few weeks/a month, before dropping down heavily again. This pattern seems to be shaping up at the moment as well, particularly in relation to the last such cycle, which would mean price going down to $400-ish by mid-May, after which time the triangle will have long ended, leaving very little support to prevent a sharp drop.

Along with this, I'm trying to apply my fibhorn technique to get a sense of price targets if the bear scenario is still relevant. While previously $260~ has seemed like a solid target, the latest price developments seem to be painting an increasingly bearish picture, with a 0 level at $160 making a very good fit, and it pings nicely with earlier price movements as well. Then again, ratio analysis seems to support a bottom nearer my original $260~ prediction. If one looks at the ratio of the previous peak-drop (710-340), and applies it to the latest peak of $540, the result is $270.



I suppose it's possible the $250-270 range may act as support, which will be immediately followed by a sharp rise and yet another cycle taking us to $160 bottom, like so;



Good trading opportunity if true

This is all, of course, nooby fringe TA, and only even remotely relevant if the bear trend is still on, so take it as you will. If daily SMA50 and 100 are broken, I will consider the bull market confirmed. Until then, I remain undecided, leaning towards being a bear.

Just my 2 satoshi

[BitchicksHusband]

If that happens, I'll be buying all through the $3xxs, $2xxs and $1xxs.

[windjc]

I'm not entirely sure we're out of the downtrend yet. The trendline might have been broken, but at the same time this price movement looks very fractal/self-similar to me. The previous 2 major drops have always been marked by a sharp increase directly afterwards, followed by a slowly stagnating price for a few weeks/a month, before dropping down heavily again. This pattern seems to be shaping up at the moment as well, particularly in relation to the last such cycle, which would mean price going down to $400-ish by mid-May, after which time the triangle will have long ended, leaving very little support to prevent a sharp drop.

Along with this, I'm trying to apply my fibhorn technique to get a sense of price targets if the bear scenario is still relevant. While previously $260~ has seemed like a solid target, the latest price developments seem to be painting an increasingly bearish picture, with a 0 level at $160 making a very good fit, and it pings nicely with earlier price movements as well. Then again, ratio analysis seems to support a bottom nearer my original $260~ prediction. If one looks at the ratio of the previous peak-drop (710-340), and applies it to the latest peak of $540, the result is $270.



I suppose it's possible the $250-270 range may act as support, which will be immediately followed by a sharp rise and yet another cycle taking us to $160 bottom, like so;



Good trading opportunity if true

This is all, of course, nooby fringe TA, and only even remotely relevant if the bear trend is still on, so take it as you will. If daily SMA50 and 100 are broken, I will consider the bull market confirmed. Until then, I remain undecided, leaning towards being a bear.

Just my 2 satoshi

My gut would tend to agree with you. And my instincts are normally spot on.

However, there is a truth that if everyone refuses to sell, that the bear market can't continue. And it seems like fewer and fewer people are willing to sell on the exchanges that control the price. Why do it, when you can sell off exchange and not make the price go down? (I'm talking to you miners).

As much as there isn't demand to push the price up, the question then becomes who is left to sell?

I know it seems like the answer to that question has plenty of answers, but it even felt like the last capitulation to 340 was basically agreed on by everyone in advance. Now it seems like everyone is agreeing to wait it out until we go up.

That sounds, on its face, like sheer lunacy. But there is more than a 0% chance that this is actually a close description to the situation at hand.

[oda.krell]

I'm not entirely sure we're out of the downtrend yet. The trendline might have been broken, but at the same time this price movement looks very fractal/self-similar to me. The previous 2 major drops have always been marked by a sharp increase directly afterwards, followed by a slowly stagnating price for a few weeks/a month, before dropping down heavily again. This pattern seems to be shaping up at the moment as well, particularly in relation to the last such cycle, which would mean price going down to $400-ish by mid-May, after which time the triangle will have long ended, leaving very little support to prevent a sharp drop.

Along with this, I'm trying to apply my fibhorn technique to get a sense of price targets if the bear scenario is still relevant. While previously $260~ has seemed like a solid target, the latest price developments seem to be painting an increasingly bearish picture, with a 0 level at $160 making a very good fit, and it pings nicely with earlier price movements as well. Then again, ratio analysis seems to support a bottom nearer my original $260~ prediction. If one looks at the ratio of the previous peak-drop (710-340), and applies it to the latest peak of $540, the result is $270.



I suppose it's possible the $250-270 range may act as support, which will be immediately followed by a sharp rise and yet another cycle taking us to $160 bottom, like so;



Good trading opportunity if true

This is all, of course, nooby fringe TA, and only even remotely relevant if the bear trend is still on, so take it as you will. If daily SMA50 and 100 are broken, I will consider the bull market confirmed. Until then, I remain undecided, leaning towards being a bear.

Just my 2 satoshi

My gut would tend to agree with you. And my instincts are normally spot on.

However, there is a truth that if everyone refuses to sell, that the bear market can't continue. And it seems like fewer and fewer people are willing to sell on the exchanges that control the price. Why do it, when you can sell off exchange and not make the price go down? (I'm talking to you miners).

As much as there isn't demand to push the price up, the question then becomes who is left to sell?

I know it seems like the answer to that question has plenty of answers, but it even felt like the last capitulation to 340 was basically agreed on by everyone in advance. Now it seems like everyone is agreeing to wait it out until we go up.

That sounds, on its face, like sheer lunacy. But there is more than a 0% chance that this is actually a close description to the situation at hand.

I actually think that perfectly describes the current situation. But you're forgetting one thing, imo: that already was the situation in early March, or pretty close to it.

The big panic moments seemed behind us. Holders vowed to not panic another time. "This time we will just hodl, no matter what".

But then the low level selling pressure (China? Mining? Both?) slowly made the price grind down, and that always has a habit of turning 'I swear, I will never again panic' holders into, well, panic sellers.

That's on the horizon again, unless the price level where we landed after the initial euphoric swing can be sustained this time.

[windjc]

I'm not entirely sure we're out of the downtrend yet. The trendline might have been broken, but at the same time this price movement looks very fractal/self-similar to me. The previous 2 major drops have always been marked by a sharp increase directly afterwards, followed by a slowly stagnating price for a few weeks/a month, before dropping down heavily again. This pattern seems to be shaping up at the moment as well, particularly in relation to the last such cycle, which would mean price going down to $400-ish by mid-May, after which time the triangle will have long ended, leaving very little support to prevent a sharp drop.

Along with this, I'm trying to apply my fibhorn technique to get a sense of price targets if the bear scenario is still relevant. While previously $260~ has seemed like a solid target, the latest price developments seem to be painting an increasingly bearish picture, with a 0 level at $160 making a very good fit, and it pings nicely with earlier price movements as well. Then again, ratio analysis seems to support a bottom nearer my original $260~ prediction. If one looks at the ratio of the previous peak-drop (710-340), and applies it to the latest peak of $540, the result is $270.



I suppose it's possible the $250-270 range may act as support, which will be immediately followed by a sharp rise and yet another cycle taking us to $160 bottom, like so;



Good trading opportunity if true

This is all, of course, nooby fringe TA, and only even remotely relevant if the bear trend is still on, so take it as you will. If daily SMA50 and 100 are broken, I will consider the bull market confirmed. Until then, I remain undecided, leaning towards being a bear.

Just my 2 satoshi

My gut would tend to agree with you. And my instincts are normally spot on.

However, there is a truth that if everyone refuses to sell, that the bear market can't continue. And it seems like fewer and fewer people are willing to sell on the exchanges that control the price. Why do it, when you can sell off exchange and not make the price go down? (I'm talking to you miners).

As much as there isn't demand to push the price up, the question then becomes who is left to sell?

I know it seems like the answer to that question has plenty of answers, but it even felt like the last capitulation to 340 was basically agreed on by everyone in advance. Now it seems like everyone is agreeing to wait it out until we go up.

That sounds, on its face, like sheer lunacy. But there is more than a 0% chance that this is actually a close description to the situation at hand.

I actually think that perfectly describes the current situation. But you're forgetting one thing, imo: that already was the situation in early March, or pretty close to it.

The big panic moments seemed behind us. Holders vowed to not panic another time. "This time we will just hodl, no matter what".

But then the low level selling pressure (China? Mining? Both?) slowly made the price grind down, and that always has a habit of turning 'I swear, I will never again panic' holders into, well, panic sellers.

That's on the horizon again, unless the price level where we landed after the initial euphoric swing can be sustained this time.

Is that around $440, in your opinion? Or $400?

As for your other comments, I guess I don't remember people feeling the same after the Gox situation. Maybe they did. It did seem like not too long before China reared its ugly "news" head.

I will say this, if this market lingers downward and then in a couple of weeks we started getting "negative news" from somewhere, (quotes suggesting that the market just chooses some news to classify as negative) and that causes more and deeper sell offs, then I am going to be watching buy volume like a hawk in the future. It will prove to me that buy pressure is much more important to the bulls recovery than a "lack of selling" pressure.

[oda.krell]

[...]

Is that around $440, in your opinion? Or $400?

As for your other comments, I guess I don't remember people feeling the same after the Gox situation. Maybe they did. It did seem like not too long before China reared its ugly "news" head.

I will say this, if this market lingers downward and then in a couple of weeks we started getting "negative news" from somewhere, (quotes suggesting that the market just chooses some news to classify as negative) and that causes more and deeper sell offs, then I am going to be watching buy volume like a hawk in the future. It will prove to me that buy pressure is much more important to the bulls recovery than a "lack of selling" pressure.

Yeah, sorry, should have phrased that more clearly. I meant the level that the first major rally takes us to after a capitulation bottom (or what looked like it at the time). So, around 630 in early March, 490-500 now. Which is, to my mind, the plateau that needs to be "defended" by a combination of lack of selling pressure (done) and sufficient buying pressure (outlook hazy). Once it was clear the plateau can't be defended (like in March 18 to 20), the panic selling started.

[Bitcoin_is_here_to_stay]

I also believe the current stagnation is a sort of stand off between btw hodlers, refusing to sell, and investors waiting with fiat on the sidelines, refusing to buy at  the current prices. Of course, I cannot know how it resolves - nobody can. But I have read the miners forum and miners there are talking about maxing their credit cards etc or even not paying bills, fully expecting that prices will go up substantially in the very near future. Many miners will *have to* sell some bitcoins soon, just to cover their expenses. OTOH, nobody really *has to* but bitcoins ... So imho, price is more likely to go down, at least until the situation with many miners being in debt now would resolve. 

[windjc]

I also believe the current stagnation is a sort of stand off between btw hodlers, refusing to sell, and investors waiting with fiat on the sidelines, refusing to buy at  the current prices. Of course, I cannot know how it resolves - nobody can. But I have read the miners forum and miners there are talking about maxing their credit cards etc or even not paying bills, fully expecting that prices will go up substantially in the very near future. Many miners will *have to* sell some bitcoins soon, just to cover their expenses. OTOH, nobody really *has to* but bitcoins ... So imho, price is more likely to go down, at least until the situation with many miners being in debt now would resolve. 

Miners talking about maxing their credit cards to cover expenses is very bearish news.

One can't really say second or third hand from a forum post, but if that's true in any widespread sense, then that is bearish indeed.

I think its dumb to be a miner in this market anyway. Better just to invest in bitcoin. Mining makes no sense at a small time player level. Better to mine alts.

[Bitcoin_is_here_to_stay]

I have no idea what is a general sentiment among miners - but what I gleaned from bitcoin talk discussion is that they view current price levels as temporary and are trying to survive by taking on debt.

I do agree that mining does not make sense economically atm - some of the miners are using curious argument of the type "I mine bitcoins while I still can" 

Anyways, I am also waiting for imho inevitable crash in mining rig prices and perhaps bankruptcies of some mining companies. Miners can be in a real tough spot soon - unlike GPUs, ASICs can be only used for mining, so their prices can decrease dramatically.

[oda.krell]

Let's try a new triangle, to describe the bounds of a continued bear market/consolidation, i.e. in case we don't manage to "defend" the current ~500 plateau:





Judging by how the market seemed to resolve (or at least: test) those triangles a bit ahead of time the previous instances, we might see a decisive move against the bounds of this triangle in late May/early June.

[sgbett]

seems entirely possible. suits my short term bearish outlook. satisfies the 'ohmigosh it can't possibly go lower' aspect of capitulation/max pain.

i like it sir!

[oda.krell]

seems entirely possible. suits my short term bearish outlook. satisfies the 'ohmigosh it can't possibly go lower' aspect of capitulation/max pain.

i like it sir!

Thanks. Combines "the bottom is in" with "the pain isn't over"... what's not to like :D

[m3g4tr0n]

It's what I believe is going to happen, so I went full fiat at 512 with the hope of buying back around 375-400 before mid may. Wish me luck

[oda.krell]

It's what I believe is going to happen, so I went full fiat at 512 with the hope of buying back around 375-400 before mid may. Wish me luck

I'm sure I don't need to tell you this, but I hope you also set a stop-loss to buy back in. Decide, ahead of time, at which price you'll have to consider your previous assumptions to be proven wrong by the market, and then stick to it.

1d Ichimoku cloud comes to mind, or daily SMA200. But, whatever you pick, don't go back on your decision later unless you have extremely good reasons to do so.

[bucktotal]

taking a step back again, and looking at the longer-term trends in some indicators, it appears they have all flipped this past week 

[m3g4tr0n]

It's what I believe is going to happen, so I went full fiat at 512 with the hope of buying back around 375-400 before mid may. Wish me luck

I'm sure I don't need to tell you this, but I hope you also set a stop-loss to buy back in. Decide, ahead of time, at which price you'll have to consider your previous assumptions to be proven wrong by the market, and then stick to it.

1d Ichimoku cloud comes to mind, or daily SMA200. But, whatever you pick, don't go back on your decision later unless you have extremely good reasons to do so.

If it breaks 550 on stamp...


I like to stare at the stamp 6h chart right now because the resolution on my screen shows exactly 6 months. The descending fractal-ish downtrend since the ATH is bizarre in the way it that Jan-06 through Mar-03 looks identical to Mar-03 through Apr-15. My pattern recognition hard-wiring tells me we are in for a 3rd smaller one (also could be a total fallacy).

For Apr-15 thru May-20, if it does anything besides taking a bumpy little ride down to ~325 I will be surprised.

[oda.krell]

Hm. That escalated quickly. Looks like the 'extended triangle' suggestion from April 24 is becoming more likely.


Quick Fibo update:

I changed my view what the best way is to assign Fibo levels to the current uptrend. I'm now going from the April 13 low (397 USD) to the top (548 USD). Under that view, we get the following picture of retracements of the current uptrend:



We bounced off quite nicely from 62% (454 USD), but now it looks like 50% (472 USD) could act as resistance.

Based on 6h momentum alone, I suspect we get another leg down almost immediately, but if we bounce off of 62% again and break through 50% soon enough on a bit of volume, I can also see the potential of a (temporary) recovery back to ~480-490.


EDIT: 62% provided very little support. I expect we will eventually visit the next level, @430.

[JustAnotherSheep]

Hm. That escalated quickly. Looks like the 'extended triangle' suggestion from April 24 is becoming more likely.


Quick Fibo update:

I changed my view what the best way is to assign Fibo levels to the current uptrend. I'm now going from the April 13 low (397 USD) to the top (548 USD). Under that view, we get the following picture of retracements of the current uptrend:

(huge image)

We bounced off quite nicely from 62% (454 USD), but now it looks like 50% (472 USD) could act as resistance.

Based on 6h momentum alone, I suspect we get another leg down almost immediately, but if we bounce off of 62% again and break through 50% soon enough on a bit of volume, I can also see the potential of a (temporary) recovery back to ~480-490.


EDIT: 62% provided very little support. I expect we will eventually visit the next level, @430.

Another way of looking at it would be as this channel



(the upper line has the same starting point as the long December trendline, only set to ping at the most recent peak).

Looks to me like it's shaping up more and more like the previous stagnating cycle. The similarities are quite staggering. If so, then something like this should be the most likely short-term price development, before breaking down hard, possibly to $266~, or possibly to a bounce on $320~ (lowest trendline).



Time to set buy orders soon

[oda.krell]

Looks to me like it's shaping up more and more like the previous stagnating cycle. The similarities are quite staggering. If so, then something like this should be the most likely short-term price development, before breaking down hard, possibly to $266~, or possibly to a bounce on $320~ (lowest trendline).



Time to set buy orders soon

Agreed, mostly. But I wouldn't dismiss the possibility that we saw the bottom on April 11th, and are now grinding down to a (slightly) higher low, which will terminate the bear market more clearly.

[JustAnotherSheep]

Agreed, mostly. But I wouldn't dismiss the possibility that we saw the bottom on April 11th, and are now grinding down to a (slightly) higher low, which will terminate the bear market more clearly.

Indeed, that is a possibility, but for the moment I'm choosing to take the more bearish outlook (until proven wrong).

[JustAnotherSheep]

Oh wow. I just realized my chart hadn't been set to log scale, and when I did it turns out the long term resistance line hasn't been broken at all



How incredibly nooby of me.

Yet, on linear many of the pings seem to be slightly more accurate Such as this (log)



vs this (linear)



Which should be used? Or are both valid?

[oda.krell]

Oh wow. I just realized my chart hadn't been set to log scale, and when I did it turns out the long term resistance line hasn't been broken at all



How incredibly nooby of me.

Yet, on linear many of the pings seem to be slightly more accurate Such as this (log)



vs this (linear)



Which should be used? Or are both valid?

hehehe, welcome to the discussion from 2 weeks ago. Forgot who was the first one to suggest using a log chart for the December downtrend... but I suspect the thought appeared to more people around the same time as the bear market stretched out.

I find the most plausible log downtrend right now not the one connecting to the ATH in December (like yours seems to do), but touching the peaks on January 6 and March 3. I get more points of contact like that. That's the upper bound of my "extended triangle" from the previous page.

EDIT: Here's an illustration of what I mean:

[oda.krell]

One more post on triangles (of doom), i.e. possible boundaries of a continuation of the downtrend that governed price action since early December (We're getting close to 5 months now. Quite the bear market, huh?)





(A) is the log trend line connecting the December ATH with the early January peak (near 1000). I don't consider it the most likely candidate for the main downtrend, for two reasons: a) too little points of contact, and b) price action has been too far away from the trendline for a long time, i.e. it's not only not touching the line, it's not even /near/ it for months now.

(B) is my main candidate for the upper bound of our downtrend. 3 points of contact, and price in general staying close to it to make it appear a relevant trend even at times when price doesn't touch the line.

(C) is the old lower boundary, the line through the 380-400 local bottoms. It's a log line as well, but only very weakly slopes upwards. That trendline was broken of course, on April 10/11, and again two days later, but it might still act as resistance. After all, we only closed one daily candle below it (another daily candle two days later is a borderline case), and we bounced off of it on decent volume, so you could argue the line was tested and held (sort of).

(D) is the log trendline between the 2013 ATH (at 266) and the current capitulation bottom (at 340). It is based on two assumptions a) 340 was indeed the final bottom (for which one can find independent reasons, such as the observation that we bounced off of the lower weekly Bollinger Band the week after the April 11 capitulation), and b) there is a very small (exponential) growth between the *high* of the previous bubble cycle and the final bottom of the *current* bubble cycle.

Taken together, those trendlines meet at 4 points:

(1) (Latest) Time of conclusion: Late May. Price point of conclusion: low to mid 400s. A possible candidate to mark the end of the December bear market. It would mean the 400 trendline held after all, but so does the more severe downtrend (B). Assuming it would  break out downwards, we would get to:

(2) Late June, mid 300s. My preferred candidate (EDIT: "preferred" as in: the most likely one) for a resolution of the bear market. It assumes the log line from previous ATH to current bottom holds, as does downtrend B, and once we hit the 300s again we might have enough force to finally break through B decisively.

(3) Early/Mid July, mid 400s. Assumes the 400 trendline holds now, but the B downtrend wasn't the relevant downtrend. Not very likely, in my opinion.

(4) Mid August, slightly below 400. The most dragged out consolidation triangle. Slightly more likely than scenario 3 I would say: it'd give the market a lot more time to take a "time out", without any major new price breakthroughs, neither up nor down. Think: No fresh fiat arriving for a long time, but the time for huge panic selling is over as well.

[windjc]

One more post on triangles (of doom), i.e. possible boundaries of a continuation of the downtrend that governed price action since early December (We're getting close to 5 months now. Quite the bear market, huh?)





(A) is the log trend line connecting the December ATH with the early January peak (near 1000). I don't consider it the most likely candidate for the main downtrend, for two reasons: a) too little points of contact, and b) price action has been too far away from the trendline for a long time, i.e. it's not only not touching the line, it's not even /near/ it for months now.

(B) is my main candidate for the upper bound of our downtrend. 3 points of contact, and price in general staying close to it to make it appear a relevant trend even at times when price doesn't touch the line.

(C) is the old lower boundary, the line through the 380-400 local bottoms. It's a log line as well, but only very weakly slopes upwards. That trendline was broken of course, on April 10/11, and again two days later, but it might still act as resistance. After all, we only closed one daily candle below it (another daily candle two days later is a borderline case), and we bounced off of it on decent volume, so you could argue the line was tested and held (sort of).

(D) is the log trendline between the 2013 ATH (at 266) and the current capitulation bottom (at 340). It is based on two assumptions a) 340 was indeed the final bottom (for which one can find independent reasons, such as the observation that we bounced off of the lower weekly Bollinger Band the week after the April 11 capitulation), and b) there is a very small (exponential) growth between the *high* of the previous bubble cycle and the final bottom of the *current* bubble cycle.

Taken together, those trendlines meet at 4 points:

(1) (Latest) Time of conclusion: Late May. Price point of conclusion: low to mid 400s. A possible candidate to mark the end of the December bear market. It would mean the 400 trendline held after all, but so does the more severe downtrend (B). Assuming it would  break out downwards, we would get to:

(2) Late June, mid 300s. My preferred candidate (EDIT: "preferred" as in: the most likely one) for a resolution of the bear market. It assumes the log line from previous ATH to current bottom holds, as does downtrend B, and once we hit the 300s again we might have enough force to finally break through B decisively.

(3) Early/Mid July, mid 400s. Assumes the 400 trendline holds now, but the B downtrend wasn't the relevant downtrend. Not very likely, in my opinion.

(4) Mid August, slightly below 400. The most dragged out consolidation triangle. Slightly more likely than scenario 3 I would say: it'd give the market a lot more time to take a "time out", without any major new price breakthroughs, neither up nor down. Think: No fresh fiat arriving for a long time, but the time for huge panic selling is over as well.

This is excellent analysis.

Of course this all assume 340 was/is the low.  Don't know how I feel about that. One thing I do know, is that there looks like there was a lot of disconnection between Houbi and the other exchanges in this last impulse down.

I think the China situation continues to be an albatross around the markets neck, however, the market looks pretty resilient right now. So much bullish sentiment. So either that sentiment keeps us afloat in the impending storm or that boat slowly springs a leak and sentiment finally turns bearish again.

Its almost a war right now against people refusing to sell and a market with no new buyers. I think who wins this war will determine whether your analysis holds or we see an entirely new form of bear market.

[Bitcoin_is_here_to_stay]

I think bears will prevail. Seems that miners may be forced to sell more soon and Bitfinex shows that there is still much more leveraged longs than shorts. With current price action at least some of these longs may be getting margin calls or simply cut losses. But agree that analysis was excellent .

[kodtycoon]

i really hope all you bears are wrong.. i was really hoping it starts a major trend up in the next week or so..

[Bitcoin_is_here_to_stay]

i really hope all you bears are wrong.. i was really hoping it starts a major trend up in the next week or so..

Well, Bitfinex stats show that actually there is few bears left now Not sure if it is a bearish or a bullish sign, though

[kodtycoon]

i really hope all you bears are wrong.. i was really hoping it starts a major trend up in the next week or so..

Well, Bitfinex stats show that actually there is few bears left now Not sure if it is a bearish or a bullish sign, though

sounds like a moon landing to me!

[lebing]

One more post on triangles (of doom), i.e. possible boundaries of a continuation of the downtrend that governed price action since early December (We're getting close to 5 months now. Quite the bear market, huh?)

As far as bearish scenarios goes, i would say it doesnt get an more clear than this. Good job.

[Wary]

One more reason for the line B: the peak 1163 was truncated, by a whale (that's why we had two peaks). If it wasn't truncated, it would be higher than 1163 and would probably touch the line B.

[oda.krell]

I'm not that impressed by our current recovery from the April 25 downwards move. We bounced off from 50% as clean as can be, are currently back to the area between 23% and 38% (i.e. the very first retracement step), and the first level, 23%, looks pretty perforated to me. Taking into account volume as well, I'm leaning towards a re-test of 43x.

[windjc]

I'm not that impressed by our current recovery from the April 25 downwards move. We bounced off from 50% as clean as can be, are currently back to the area between 23% and 38% (i.e. the very first retracement step), and the first level, 23%, looks pretty perforated to me. Taking into account volume as well, I'm leaning towards a re-test of 43x.

I think its better to look at Houbi, since that is the only exchange that currently matters.





Here we can see that it has tested the 38 Fib twice and been rejected. It looks more bearish than Bitstamp.

HOWEVER - WARNING - THIS IS HOUBI - which means a sudden test of the 50% Fib at around 2900 is very likely, imho.

[Bitcoin_is_here_to_stay]

One more post on triangles (of doom), i.e. possible boundaries of a continuation of the downtrend that governed price action since early December (We're getting close to 5 months now. Quite the bear market, huh?)

As far as bearish scenarios goes, i would say it doesnt get an more clear than this. Good job.

Why you call this scenario bearish? It is actually bullish (except short term) as it assumes that bottom has been reached already. I am actually not sure of this - that is, even more bearish.

[lebing]

One more post on triangles (of doom), i.e. possible boundaries of a continuation of the downtrend that governed price action since early December (We're getting close to 5 months now. Quite the bear market, huh?)

As far as bearish scenarios goes, i would say it doesnt get an more clear than this. Good job.

Why you call this scenario bearish? It is actually bullish (except short term) as it assumes that bottom has been reached already. I am actually not sure of this - that is, even more bearish.

bullish would be a fairly quick rebound to 700+.

[oda.krell]

I think its better to look at Houbi, since that is the only exchange that currently matters.

[...]

Here we can see that it has tested the 38 Fib twice and been rejected. It looks more bearish than Bitstamp.

HOWEVER - WARNING - THIS IS HOUBI - which means a sudden test of the 50% Fib at around 2900 is very likely, imho.

Agreed. The picture looks even a bit worse on Huobi than on Stamp.

But I don't buy the commonly repeated mantra "Only Huobi/China matters at the moment". Or rather: China might determine the price, but not in the way that people commonly imagine how it works.

If we had a complete, formal model of Bitcoin price discovery that includes a model of the separate but connected exchanges, then I would in fact fully expect that one of the results of that model would be something like "current price is determined to a larger degree by China than by, say, Bitstamp".

But that's /not/ the same as saying "Huobi determines the price, then the rest of the world follows it". The process is, imo, more complex than this, and in reality involves a mutual exchange of information between the exchanges as trading takes place.

The only clear cut case of China really setting the price that others follow is through arbitrage bots, but arbitrage is (obviously) not what determines the current price level in the first place.

Where I'm getting with this:

I don't believe there is a simple leading/following division between the exchanges, except for a few individual movements, and it is perfectly possible to read the trends on either of the exchanges.

In fact, I consider many signals to be better visible on Bitstamp than on Huobi, perhaps because of a worse signal/noise ratio on Huobi that has at least a doubtful amount of volume. I explain it to myself (this is pure conjecture now of course) by noting that human traders ultimately determine the price level, but that human trading is nearly drowned out on the Chinese exchanges during most of the day through automated trading.


To be clear, I don't dismiss Huobi for getting short-term signals, but (a) I believe I can read all the relevant signals (above, say, hourly time frame) from Bitstamp data, because price is highly correlated across the exchanges, and (b) because of the high volume of unclear origin on Huobi, it is perhaps actually better not to rely on Huobi data too much for analysis.

[Bitcoin_is_here_to_stay]

I think its better to look at Houbi, since that is the only exchange that currently matters.

[...]

Here we can see that it has tested the 38 Fib twice and been rejected. It looks more bearish than Bitstamp.

HOWEVER - WARNING - THIS IS HOUBI - which means a sudden test of the 50% Fib at around 2900 is very likely, imho.

Agreed. The picture looks even a bit worse on Huobi than on Stamp.

But I don't buy the commonly repeated mantra "Only Huobi/China matters at the moment". Or rather: China might determine the price, but not in the way that people commonly imagine how it works.

If we had a complete, formal model of Bitcoin price discovery that includes a model of the separate but connected exchanges, then I would in fact fully expect that one of the results of that model would be something like "current price is determined to a larger degree by China than by, say, Bitstamp".

But that's /not/ the same as saying "Huobi determines the price, then the rest of the world follows it". The process is, imo, more complex than this, and in reality involves a mutual exchange of information between the exchanges as trading takes place.

The only clear cut case of China really setting the price that others follow is through arbitrage bots, but arbitrage is (obviously) not what determines the current price level in the first place.

Where I'm getting with this:

I don't believe there is a simple leading/following division between the exchanges, except for a few individual movements, and it is perfectly possible to read the trends on either of the exchanges.

In fact, I consider many signals to be better visible on Bitstamp than on Huobi, perhaps because of a worse signal/noise ratio on Huobi that has at least a doubtful amount of volume. I explain it to myself (this is pure conjecture now of course) by noting that human traders ultimately determine the price level, but that human trading is nearly drowned out on the Chinese exchanges during most of the day through automated trading.


To be clear, I don't dismiss Huobi for getting short-term signals, but (a) I believe I can read all the relevant signals (above, say, hourly time frame) from Bitstamp data, because price is highly correlated across the exchanges, and (b) because of the high volume of unclear origin on Huobi, it is perhaps actually better not to rely on Huobi data too much for analysis.

I am also leaning to analyse primarily Huobi these days, volume on Stamp is so abysmal, sometimes the trading simply dies there or there are only miniscule transactions, just noise. BTW, price on Huobi and Stamp almost exactly equal now - imho, looks like arbitrage works.

EDIT: I have just noticed that Bitcoinwisdom's price on Huobi is more than 2 hours old. Anyone knows what is going on? Is the problem on Huobi's or Bitcoinwisdom's part? Cannot find anything in the news 

[voluntarist500]

excellent. bump.

[UglyTroll]

Houbi will be gone in days, it's funny people still talk about it, what's the point 

[oda.krell]

Let's have a quick look at daily Ichimoku clouds, shall we?

I'm still learning the basics of it, and a part of me remains skeptic about the premises of it, mainly: the 26 day "projection" of the cloud, which seems to be based on the assumption? observation? that all markets react with a ~26 day delay... it's an interesting idea, but the skeptic in me wants to see some data on that assumption.

Anyway, here's a pattern that seems to unfold similarly now as it did about 2 weeks ago (EDIT) sorry, 6 weeks ago, around March 24:



Price drifts into the cloud (which is a prerequisite of reversing, i.e. closing above the cloud), shortly after the conversion line sees a bearish crossover with the base line (i.e. the fast average falls below the slow one), together with a delayed upwards 'jump' of the base line, which is, if I read this indicator correctly, the delayed effect (through the slower moving average of the base line) of the rally we saw around April 15 (i.e. the one that took from 340 to 550).

Note that the last time this happened, in March, price got near the base line, but failed to break through it, spent a few days (3 to 4) in the lower part of the cloud, then decisively fell out of it. My interpretation is (I am for the moment following the "delay" assumption implicit in Ichimoku analysis) that the move *into* the cloud (which can look like a bullish breakout attempt) is triggered by a delayed market reaction to the rally from about a month ago. The next necessary step however is breaking through resistances, at first the base line, then the cloud itself. Failure to do so within a few days is seen by the market as a rejection of the attempt, and leads to a sharp drop.

Applied to the current situation, we would like to see reaching the base line at ~472 today or tomorrow. That base line will inevitable fall somewhat within the next days (because the April uptrend was followed by a correction), so within the days that follow we will either see price staying above the base line, and inside the cloud (in which case we could make the case that a reversal is really underway this time), or price will fall together with the base line like it did in March, which probably means we will see another capitulation-like event.

[JustAnotherSheep]

Interesting, thank you for the info and insight of this Ichimoku cloud tool - I believe it shall prove very handy for future weather predictions

Though I am also skeptical about the 26-day delay thing. While I do not even pretend to understand it, I wish (as you do) to see more hard proof for why it is so.

As for the March 24 pattern (and, seemingly, the same we are seeing today) I believe it is more a matter of buying vs selling pressure; when we move into the cloud (or for that matter approach/ping at a resistance line) people increasingly get an idea that price won't go much further, and start selling. This triggers a snowball effect, bullish momentum slows as more and more people are selling, which further prompts people to sell, thinking price is about to go down, and finally when the selling pressure exceeds the buying pressure we get the big red candles, and a stronger snowball effect of "ok, price IS going down, no doubt about it, might as well sell now"-sentiment, triggering the extreme bearish volatility.

I think this is happening right now, as per the established logic of the self-similar bear cycles, and as such we will (as you have already stated) see a major leg down within 3 days, give or take.

[Bitcoin_is_here_to_stay]

As I understand it, I Clouds were invented in the old days, to avoid hassle of computing moving averages - they are somewhat cruder version of MA, I understand. They look cool and form very clear pattern but when I looked at the past bitcoin price, they did not seem particularly useful.

[oda.krell]

As I understand it, I Clouds were invented in the old days, to avoid hassle of computing moving averages - they are somewhat cruder version of MA, I understand. They look cool and form very clear pattern but when I looked at the past bitcoin price, they did not seem particularly useful.

Not sure if I'd consider that a very convincing argument against them. They're based on a number of (shorter term, longer term) medians, i.e. (H+L)/2, which I don't consider per se inferior to moving averages  (arithmetic means). Both have their place in TA, in my opinion. As far as usefulness is concerned, like I said, I'm still skeptical as well, but for example during the reversal period of 2013, Ichimoku analysis would have given pretty clear reversal signals well before reaching 100 (starting from around 90), which isn't too shabby if you are a swing trader who aims to take in only the large movements.

[Bitcoin_is_here_to_stay]

As I understand it, I Clouds were invented in the old days, to avoid hassle of computing moving averages - they are somewhat cruder version of MA, I understand. They look cool and form very clear pattern but when I looked at the past bitcoin price, they did not seem particularly useful.

Not sure if I'd consider that a very convincing argument against them. They're based on a number of (shorter term, longer term) medians, i.e. (H+L)/2, which I don't consider per se inferior to moving averages  (arithmetic means). Both have their place in TA, in my opinion. As far as usefulness is concerned, like I said, I'm still skeptical as well, but for example during the reversal period of 2013, Ichimoku analysis would have given pretty clear reversal signals well before reaching 100 (starting from around 90), which isn't too shabby if you are a swing trader who aims to take in only the large movements.

My understanding was that the creator consciously prioritized ease of computing over efficiency

http://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:ichimoku_cloud

so in that sense I would rather go with more "high tech" indicators. I have not tried it extensively, either, but for my purposes things like (E)MA, RSI, MACD, volume  etc work just fine. I have slightly different interests than you, though. I am also long term oriented, but I am not interested in trading swings, just in identifying good long term entry and exit points.

[oda.krell]

A bit of price action, today, and the day before yesterday. I'm extremely skeptical though, I admit. My best bet right now is that the situation is similar to the one we were in end of January:





Starting out in the lower daily BB half, inching upwards, maybe closing (just barely) above the SMA20 (the mid line of BB), only to fall back into the lower half. I do consider it possible to reach the upper half because daily MACD turned green, so some upwards momentum is to be expected.

For contrast though, look at price in relation to daily BB after we hit bottom last time (July 2013)





We decisively went through the mid SMA, and didn't close in the lower half until much later. Which is (EDIT) why I (/EDIT) personally won't trust this recovery until we are more firmly established in the upper half/above the SMA again.

[Bitcoin_is_here_to_stay]

A bit of price action, today, and the day before yesterday. I'm extremely skeptical though, I admit. My best bet right now is that the situation is similar to the one we were in end of January:





Starting out in the lower daily BB half, inching upwards, maybe closing (just barely) above the SMA20 (the mid line of BB), only to fall back into the lower half. I do consider it possible to reach the upper half because daily MACD turned green, so some upwards momentum is to be expected.

For contrast though, look at price in relation to daily BB after we hit bottom last time (July 2013)





We decisively went through the mid SMA, and didn't close in the lower half until much later. Which is personally won't trust this recovery until we are more firmly established in the upper half again.

+1 So far it stays in "dead cat bounce" area. Would have to go considerably higher - $480? - to look like trend reversal.

[oda.krell]

So, we're back below the daily Ichimoku cloud, which I described as the most likely case (barring a move to ~470 that never manifested) in my post 5 days ago.



Note that the shape of the cloud ahead of us would in principle allow for more sideways trading, below ~450, avoiding a more decisive price movement up or downwards.

However, "more of the same" (sideways movement) is not the most likely scenario in my opinion. We're still firmly inside the triangle pattern that I consider the best candidate for the boundaries of the downtrend we're in since December:



I've posted about several different versions of that large triangle before, but here's a quick recap: all trendlines are drawn in log, the resistance trendline is well known and seems fairly obvious (3 points of contact), the higher of the two support lines runs through the rising points of support around 400 (but was broken briefly on April 10/11), and the lower support line runs from April 2013 $260 to April 2014 $340. It only has two points of contact, so technically doesn't count, but I have a simple independent argument in favor of it that I'm going to post here later. Note that this supporting trendline doesn't necessarily imply that we've seen the final bottom (at $340), just that we'd expect to see some support along this trend.

Based on those two triangles, I would expect a more decisive move of the market within the next 2 weeks at the latest. Mainly for reasons of volume and money flow analysis, I am leaning towards predicting a bearish breakout, expecting that we will probably fall through the higher of the two supporting lines, and will at least test the lower one afterwards.

On the other hand, here's the case in favor of an upwards breakout:



With a bit of charitableness, I can see a falling wedge (good info on the pattern here), with signs of declining selling pressure both in the MACD and the more "gentle" downwards slope  of the lower trendline. This could hint at a continuation of the previous upwards move, the bull run that took us from $340 to $550, so: a bullish continuation pattern that could catapult us out of the large triangle. I consider it highly speculative though, so I'd wait for bullish confirmation in the form of a breakout through the upper line on high enough volume before acting on it.


EDIT: here are the numbers for the events described above, as of 2014-05-14: log downtrend @~460, higher support line @~400, lower support line @~350, bullish breakout target of falling wedge @~450 (keep in mind: needs volume for confirmation)

[oda.krell]

Price support, finally?

Okay, here's a (cautiously) bullish observation. I've argued before that one way to conceptualize the different periods of the bear market we've seen is that the market goes through rapid price swings, then stabilizes for a moment, and then determines if the price at whatever plateau we landed at is supported sufficiently by buying. In the past 4 months or so, the answer was always: "no". I have also argued that those plateaus are (probably not coincidentally) located around "round numbers", like 800, probably for psychological reasons, but I'm not sure about the latter part anymore. (here's an idea I wrote on this on tradingview).

Alright, so here's the bullish part: if I define those "briefly stable plateaus" in a natural way, say via BBW, and look at an oscillator like MFI (that in my experience is excellent for picking up changes in buying pressure), we get a rather positive picture for the current plateau:



The orange line in the MFI window (at 50) marks the difference between negative and positive money flow. The 6h view is, imo, a good compromise between picking up changes reasonably fast, while filtering out unwanted noise.

The picture I get is that during plateau #1 (January, 1st red rectangle) and plateau #2 (March, 2nd red rectangle), we saw substantial negative money flow, spending most of the time below the zero/50 line, and peaking deeper into negative territory than we did into positive territory. In other words, we didn't find support at those levels at those times, and price declined as a consequence.

Contrast this with the most recent plateau, around 440/450, and we see that we stay mostly in positive MFI territory, and see a possible upwards trend in MFI where higher MFI highs and lows indicate that we found buying support at the current level.

To really be sure of this, I would say we'd need to see MFI go above 80 now (pretty close already, at 78/79 right now). Note that in January, a (slightly weaker) upwards trend seemed to form as well, but was followed by a very sharp drop into negative territory and subsequent price decline. Say 6h MFI would cross above 80, and then, on the following (inevitable) swing down would stay in positive territory (or only briefly dip into negative), then we have  strong case that buying support for mid-400s really exists.

* * *

That's the observation. I said "cautiously bullish", because I still see a) the possibility that a large enough dump by a whale (e.g. on the Chinese exchanges) will take us back into panic selling mode, and b) because based on the overall low volume, I don't see us entering a fully developed bull market anytime soon.

But if my observation about support at this price level is correct, then that would mean that any sharp price drop (caused for example by a whale) would probably be quickly reversed, by snapping back to the current price level. It would also give us the chance to slowly grind our way out of the bearish triangle.

[oda.krell]

Funny little pattern (32 weeks).

Did I mention I'm in a relatively bullish mood lately?

Here's an amusing little pattern that I never noticed before. Discovered, or at least posted on r/BitcoinMarkets by user:amichateur.

The basic observation is: it appears that after (on average) 31.8 weeks, price reaches a local maximum (where local maximum is not properly defined for now, missing a specification of the distance/neighbourhood. deal with it, formally minded people).

Here's his thread: http://www.reddit.com/r/BitcoinMarkets/comments/25to0r/bitcoin_price_past_and_future_local_maximum_every/

Don't take it too serious, please. It's quite possibly a meaningless observation, and an even less informative extrapolation, but it will be fun at least to see if the pattern holds around early July or not.

[Wary]

this observation seems to hold for all of our price data so far. Not even in the bear market of 2011 it was broken

Assuming the exponential trend, the fact is trivial (in math sense of the world). The only non-trivial point is in 2011, when the trend was down. So, we have only one informative point, which is not quite enough for a generalization. Although I do wish your observation be true

[oda.krell]

this observation seems to hold for all of our price data so far. Not even in the bear market of 2011 it was broken

Assuming the exponential trend, the fact is trivial (in math sense of the world). The only non-trivial point is in 2011, when the trend was down. So, we have only one informative point, which is not quite enough for a generalization. Although I do wish your observation be true

That's why I wrote

Don't take it too serious, please. It's quite possibly a meaningless observation, and an even less informative extrapolation, but it will be fun at least to see if the pattern holds around early July or not.

It /is/ interesting though that even in the huge bear market of 2011, at week 32 (after the ath) the price had recovered again above the mid point. But agreed, way to little data points to make a claim for any substantial statistical power.

[windjc]

It looks like we are in a season with an extreme lack of sellers. It's obvious that no one is buying (at least on exchange), but with the really low recent bitcoin days destroyed trend and the miners seemingly refusing to sell at a loss, we have come to a complete stop.

I think we can make a short/intermediate bull run if we slowly start to edge upwards. I think this mainly because I think there is enough money sitting on the sidelines of exchanges to drive the price to the 600's. But without new money (god I hate repeating myself dozens of times) coming in, I could see us trading in the 450-650 range for a long time, with a slow drift back down towards 450, if a mini-bull rally didn't entice new investors.


Of course, tomorrow China could ban bitcoin exchanges or Houbi could declare itself insolvent and the bottom could fall out of this entire market.

[oda.krell]

It looks like we are in a season with an extreme lack of sellers. It's obvious that no one is buying (at least on exchange), but with the really low recent bitcoin days destroyed trend and the miners seemingly refusing to sell at a loss, we have come to a complete stop.

I think we can make a short/intermediate bull run if we slowly start to edge upwards. I think this mainly because I think there is enough money sitting on the sidelines of exchanges to drive the price to the 600's. But without new money (god I hate repeating myself dozens of times) coming in, I could see us trading in the 450-650 range for a long time, with a slow drift back down towards 450, if a mini-bull rally didn't entice new investors.


Of course, tomorrow China could ban bitcoin exchanges or Houbi could declare itself insolvent and the bottom could fall out of this entire market.

>I think we can make a short/intermediate bull run if we slowly start to edge upwards.
Agreed. I've said it a few times before,  I think the most relevant observation right now is that we seem to see a) sellers' exhaustion, and b) no matching increase in buying pressure (which is different from 2013 for example). Possibly, the reversal we're in now more closely resembles early 2012 than mid 2013.

>if a mini-bull rally didn't entice new investors.
Agreed as well. But as you note yourself: price increase can have this funny little habit of becoming self sustaining from a certain point onwards. Probably not at 600, but say we make it to 700, and as a result the first articles keep popping up in NYT and Forbes "To our surprise, Bitcoin is recovering quite well (but we still don't trust it)", and suddenly a new wave of money  flows in that takes us to 800. Wash rinse repeat. (nb: not saying that will happen for sure, but it's a possibility)

[JustAnotherSheep]

I don't think sellers' exhaustion entirely applies to this situation, at least not yet. As demonstrated in the other thread linking to that article on blockchain analysis, there's still a crapload of ~3-month holders, most of which are presumably deep underwater, and a breakthrough of the long-term support line (as is possibly happening now, no volume as of yet though so could be false), would confirm a continuation of the bear market which, I believe, would prompt many of these hodlers to sell in hopes of buying back later on (or perhaps pulling a Veronica and leaving the game entirely).




This is, of course, not even accounting for the risk-taking traders and (possibly) whales who were expecting an upwards breakthrough and price spike, and would probably be among the first to sell now, creating enough momentum for the hodlers to follow suit.

[oda.krell]

I don't think sellers' exhaustion entirely applies to this situation, at least not yet. As demonstrated in the other thread linking to that article on blockchain analysis, there's still a crapload of ~3-month holders, most of which are presumably deep underwater, and a breakthrough of the long-term support line (as is possibly happening now, no volume as of yet though so could be false), would confirm a continuation of the bear market which, I believe, would prompt many of these hodlers to sell in hopes of buying back later on (or perhaps pulling a Veronica and leaving the game entirely).




This is, of course, not even accounting for the risk-taking traders and (possibly) whales who were expecting an upwards breakthrough and price spike, and would probably be among the first to sell now, creating enough momentum for the hodlers to follow suit.

Valid point. I base my claim of seller exhaustion on the following observations: declining BBW, overall declining volume as price declines, and (more locally) lower volume on each progressive "crash". I do believe (and agree with you in that) that this can be temporary, and possibly more bear market will bring back the panic. I just observe that, right now, any local decline in price seems to trigger only small reactions.

[JustAnotherSheep]

Valid point. I base my claim of seller exhaustion on the following observations: declining BBW, overall declining volume as price declines, and (more locally) lower volume on each progressive "crash". I do believe (and agree with you in that) that this can be temporary, and possibly more bear market will bring back the panic. I just observe that, right now, any local decline in price seems to trigger only small reactions.

I earnestly hope you are wrong, as this endless sideways movement is absolutely horrid and does not befit the typical, exciting rollercoaster-ride that is Bitcoin. If it turns out we're just breaking out of the triangle for yet another drawn-out and disappointing period of sideways stagnation, I do believe I shall shoot myself out of boredom.

[oda.krell]

Valid point. I base my claim of seller exhaustion on the following observations: declining BBW, overall declining volume as price declines, and (more locally) lower volume on each progressive "crash". I do believe (and agree with you in that) that this can be temporary, and possibly more bear market will bring back the panic. I just observe that, right now, any local decline in price seems to trigger only small reactions.

I earnestly hope you are wrong, as this endless sideways movement is absolutely horrid and does not befit the typical, exciting rollercoaster-ride that is Bitcoin. If it turns out we're just breaking out of the triangle for yet another drawn-out and disappointing period of sideways stagnation, I do believe I shall shoot myself out of boredom.

I talked to a lady at the bitcoin foundation member meeting two days ago (a real, live lady! double x chromosomes! at bitcoin!) (I'm kidding. lots of ladies in bitcoin.) (only about 10 to 15% I guess. great now I'm depressed :/) who said that she'd consider less volatility much preferable to the current situation. She works for a large European company that didn't integrate anything Bitcoin yet, but they seem to keep their eyes open.

Not exactly 6 o'clock news (companies abhor risk, volatility = risk), but I'm just putting that out here: us traders might dislike flat periods, but big business probably doesn't mind it.

[oda.krell]

Update on long term downtrend and Money Flow


Long term log downtrend broken: check




SMA50 broken: check




Money flow stable to rising: check




Comparably low volume so far (though better than the week before), which is both consistent with "guided action" by a whale, or just the cautiousness you'd expect after a long bear market.

I do however take the MFI development (since my last post about it) as evidence that we have decent price support at this level, so even if we don't see a high-volume rally coming up in the next days (which the bulls are cheering for now), I now consider the events 'rally' or 'slow crawl upwards' strictly more likely than 'sudden crash' or 'slow crawl downwards'.

To be on the safe side, waiting for confirmation through volume until tomorrow could be a good idea, but it can also mean you're missing out on profit. Your choice.

tl;dr If this is another pump & dump, it is well enough orchestrated for me to think this is the real deal. Short-to-mid term bullish again.

[studio1one]

Update on long term downtrend and Money Flow


Long term log downtrend broken: check




SMA50 broken: check




Money flow stable to rising: check




Comparably low volume so far (though better than the week before), which is both consistent with "guided action" by a whale, or just the cautiousness you'd expect after a long bear market.

I do however take the MFI development (since my last post about it) as evidence that we have decent price support at this level, so even if we don't see a high-volume rally coming up in the next days (which the bulls are cheering for now), I now consider the events 'rally' or 'slow crawl upwards' strictly more likely than 'sudden crash' or 'slow crawl downwards'.

To be on the safe side, waiting for confirmation through volume until tomorrow could be a good idea, but it can also mean you're missing out on profit. Your choice.

tl;dr If this is another pump & dump, it is well enough orchestrated for me to think this is the real deal. Short-to-mid term bullish again.

Clouds dammit. I want clouds.

[oda.krell]

Clouds dammit. I want clouds.

Way too early for that :D

But chances are better now we're getting there pretty soon, I believe.

[studio1one]

Clouds dammit. I want clouds.

Way too early for that

But chances are better now we're getting there pretty soon, I believe.

My flair is officially bullish. First time since March.

[oda.krell]

The following is just a side remark, posted in full awareness that, while the current breakout looks solid to me, it could still turn out to be false, or at least retrace so much it'd hurt.

Anyway, here's a 15 min view of the breakout, together with the LT log downtrend I (and many others) have been going on about for ages...





Jup. That's clearly the shape of a big middle finger forming, aimed at those who think trendlines are just "randomly drawn lines on a chart" :D

Also, don't say it's "just a self-fulfilling prophecy". Even if it were one, it would still mean you can't ignore it.

EDIT

[...]

Taken together, those trendlines meet at 4 points:

(1) (Latest) Time of conclusion: Late May. Price point of conclusion: low to mid 400s. A possible candidate to mark the end of the December bear market. It would mean the 400 trendline held after all, but so does the more severe downtrend (B). Assuming it would  break out downwards, we would get to:

[...]

[lebing]

Just piping in here to say this isnt a circle jerk and there are more people following your stuff than you think 

[oda.krell]

Just piping in here to say this isnt a circle jerk and there are more people following your stuff than you think  ;)

Thanks! I really appreciate that :)

[JustAnotherSheep]

Agree with the bullishness. Breakthrough of short-term + the 2 longer-term log trendlines, with volume and force, was plenty enough to turn me bull and post the obligatory rocket pic in the wall observer thread

Now I just pray to all the market gods that, as you say, I'm not being played by a very clever (and very rich) whale. Or even worse, that this Wave B out of C, and that once we reach the top (estimated, in such a scenario, to be $600~ based on SMA200, fractal ratio analysis of the mid bear-cycle's top and bottom (400-710) as well as the good ol' fibhorn) we're in for another 6-month bear-market.

But this is far too bearish a scenario, even worse than 2011, makes no sense in our current situation (particularly if Wall Street is indeed gaining interest as rumored).

Edit: It's interesting to note how, in retrospect, the breaking of the linear resistance line seems a more valid signal of trend reversal than the log one(s), as it told the same tale only far earlier. One could call it a lucky fluke. Yet somehow it doesn't look like it, as the strong adherence to it as support after the breakthrough would lend weight to it still being a major (if not the major) line. Lesson for next time not to dismiss the linear chart so readily in favor of my bearish bias.

[oda.krell]

Agree with the bullishness. Breakthrough of short-term + the 2 longer-term log trendlines, with volume and force, was plenty enough to turn me bull and post the obligatory rocket pic in the wall observer thread

Now I just pray to all the market gods that, as you say, I'm not being played by a very clever (and very rich) whale. Or even worse, that this Wave B out of C, and that once we reach the top (estimated, in such a scenario, to be $600~ based on SMA200, fractal ratio analysis of the mid bear-cycle's top and bottom (400-710) as well as the good ol' fibhorn) we're in for another 6-month bear-market.

But this is far too bearish a scenario, even worse than 2011, makes no sense in our current situation (particularly if Wall Street is indeed gaining interest as rumored).

Edit: It's interesting to note how, in retrospect, the breaking of the linear resistance line seems a more valid signal of trend reversal than the log one(s), as it told the same tale only far earlier. One could call it a lucky fluke. Yet somehow it doesn't look like it, as the strong adherence to it as support after the breakthrough would lend weight to it still being a valid (if not the major) line. Lesson for next time not to dismiss the linear chart so readily in favor of my bearish bias.

Not sure about that.

Wrt price, it made very little difference, at least for the linear trendline and log trendline that I looked at (broken through at 445 on linear, at 449 on the log one).

But the real test is always 'breakthrough on volume'. And that one clearly goes to the log line.


EDIT: I see your point now.  You mean the linear trendline that connects to the December high. Agreed, volume wise you could argue it was at least as good as the current one, but the linear one you mean broke through at 499 520, then retraced quite a lot (down to 420), which is why I guess the market needed at least another confirmation.

[bucktotal]

taking a step back again, and looking at the longer-term trends in some indicators, it appears they have all flipped this past week 

on apr 24 i posted the above suggesting we had just started the trend reversal.

here is the update to this chart a few weeks farther along.

I've added my tuned SAR indicator, perhaps the clearest indicator of reversal over the years (but of course lags).

[bucktotal]

Clouds dammit. I want clouds.

Way too early for that

But chances are better now we're getting there pretty soon, I believe.

its important to consider the consequences of using the default settings on any indicator. its far safer to assume that each dynamic system has unique intrinsic properties, and adjust accordingly to better describe whats going on.

we indeed popped through the cloud today. but it was fast, so i'd just give it time to play out.

[oda.krell]

on apr 24 i posted the above suggesting we had just started the trend reversal.

here is the update to this chart a few weeks farther along.

I've added my tuned SAR indicator, perhaps the clearest indicator of reversal over the years (but of course lags).

[...]

I'm not dismissing your findings, but I don't agree with the way you present them either.

The question is similar to the one brought up by JustAnotherSheep two posts ago, about the earlier break of the linear downtrend: if price retraces again substantially and the market enters a low volume phase for more than an entire month, was it really already a 'reversal' at that time, or did the market itself wait for another confirmation? We should distinguish the (post facto) event "the bottom was in at that point" and the (determined as we go along) decision "reversal, yes or no?".

Part of that question is hypothetical, since we have seen yesterday the 2nd confirmation of a reversal. Another part of the question is not hypothetical at all: when should you buy in? Buying in at the earlier reversal signal would have meant getting in at 480 to 500. Waiting for the breakthrough yesterday gave you more certainty, as well as a better price: between 455 (if you were really fast) and 470.

Of course, if you were even faster, you were able to buy at 340 to 400, but we're talking about confirmation scenarios here, not buying into the bottom itself.

[bucktotal]

on apr 24 i posted the above suggesting we had just started the trend reversal.

here is the update to this chart a few weeks farther along.

I've added my tuned SAR indicator, perhaps the clearest indicator of reversal over the years (but of course lags).

[...]

I'm not dismissing your findings, but I don't agree with the way you present them either.

The question is similar to the one brought up by JustAnotherSheep two posts ago, about the earlier break of the linear downtrend: if price retraces again substantially and the market enters a low volume phase for more than an entire month, was it really already a 'reversal' at that time, or did the market itself wait for another confirmation? We should distinguish the (post facto) event "the bottom was in at that point" and the (determined as we go along) decision "reversal, yes or no?".

Part of that question is hypothetical, since we have seen yesterday the 2nd confirmation of a reversal. Another part of the question is not hypothetical at all: when should you buy in? Buying in at the earlier reversal signal would have meant getting in at 480 to 500. Waiting for the breakthrough yesterday gave you more certainty, as well as a better price: between 455 (if you were really fast) and 470.

Of course, if you were even faster, you were able to buy at 340 to 400, but we're talking about confirmation scenarios here, not buying into the bottom itself.

but you'll note that these charts have no trend lines. here, i've been showing bitcoin-tuned moving average indicators that help me see rates of change, and changes in rates of change. they are tuned to hopefully filter out noise and show me more clearly what stage we are in with respect to the long-term market oscillations.

personally, i was buying all the panic dips into the 350-500 range across a few exchanges anyway before these lagging signals. but for my more conservative investors funds that i manage (a.k.a., friends and family), i started buying at the earlier reversal signal that i posted, and buying all dips and a little every day over the past few weeks.


 

[oda.krell]

Short update on daily cloud, money flow

The 6h money flow view, which was the dominant reason for making me (cautiously) optimistic a week ago, continues to look pretty good (see first chart below). In addition we're going through the daily Ichimoku cloud quicker than I expected. We're currently sitting right below the upper boundary of the cloud (~$507), but I see a good chance that one more push will put us above eventually.

(aside: I'm looking into different parameters for the cloud, other than the standard ones... haven't found any that I like better yet, but will continue looking. Thanks for the suggestion, bucktotal)

We're still far below the daily SMA200, which by conventional wisdom means we should expect bearish throwbacks all the way up.

To reiterate the main point I was trying to make since my first MFI post: while I'm still skeptical whether we're entering a sustained bullish environment already (not enough fresh fiat for that yet, in my opinion), it looks to me like mid-400s marks a "sustainable price plateau", for the first time since the 2014 bear market began. So for those who were worried about a continued decline of the USD value of their trading account, this seemed like a good (re)entrance point.

[JustAnotherSheep]

Indeed, I suspect the bulls are getting over-excited over the exit of the long bear market and we'll soon see more heavy retraces and periods of consolidation before any real bubble-like growth can begin. Parallels might be drawn to 2013, where the bottom ($62) was followed by a sharp move to $100, followed by the first major drop.



Interestingly, applying the ratio of this on our presumed bottom (340) returns 548, so that might just be a local top followed by the expected heavier pullback (unless we go all the way to daily SMA200 in one shot).

Furthermore, I am paying close attention to hourly SMA200 (which lucif dubbed as "the holy grail of all bubbles" and so, by default, must be significant ) to get a sense of possible supports and whatnot. For now it is positioned very close to the long-term log support line, and during the aforementioned 2013 post-bottom drop it was pierced pretty heavily, so it's possible the support line will be tested before taking off properly.



However, I'm not entirely sure 2013 patterns are anything to go by in this case, as we never even crossed daily SMA200 then, so obviously the situation is (to some extent, at least) different. Then again, experience has taught me that ratios in particular tend to be consistent and static, defying common sense, so who knows.

edit: Another interesting thing I just noticed; applying the ratio of the local top (100) and bottom (76) for the above 2013 drop on daily SMA200 (currently around 630) results in 478, which is extremely close to the support line, which (judging by super-fringe and nooby ratio (over)analysis) would seem to support the notion of us going that far before the hypothetical major drop to test the line.

[oda.krell]

Indeed, I suspect the bulls are getting over-excited over the exit of the long bear market and we'll soon see more heavy retraces and periods of consolidation before any real bubble-like growth can begin. Parallels might be drawn to 2013, where the bottom ($62) was followed by a sharp move to $100, followed by the first major drop.



Interestingly, applying the ratio of this on our presumed bottom (340) returns 548, so that might just be a local top followed by the expected heavier pullback (unless we go all the way to daily SMA200 in one shot).

Furthermore, I am paying close attention to hourly SMA200 (which lucif dubbed as "the holy grail of all bubbles" and so, by default, must be significant ) to get a sense of possible supports and whatnot. For now it is positioned very close to the long-term log support line, and during the aforementioned 2013 post-bottom drop it was pierced pretty heavily, so it's possible the support line will be tested before taking off properly.



However, I'm not entirely sure 2013 patterns are anything to go by in this case, as we never even crossed daily SMA200 then, so obviously the situation is (to some extent, at least) different. Then again, experience has taught me that ratios in particular tend to be consistent and static, defying common sense, so who knows.

edit: Another interesting thing I just noticed; applying the ratio of the local top (100) and bottom (76) for the above 2013 drop on daily SMA200 (currently around 630) results in 478, which is extremely close to the support line, which (judging by super-fringe and nooby ratio (over)analysis) would seem to support the notion of us going that far before the hypothetical major drop to test the line.

Excellent points.

Initially, I kept thinking that the early April run-up should look like July last year, but that was way too optimistic of course. I like to think of the period right now as our "2nd chance" to get out of the bear market.

I follow your ratio analysis, and don't have much to say other than that it makes some sense, and that I would add: what made July '13 such a clear reversal was that the piercing of the mid term average (1h SMA200, 30d EMA works as well) was rejected almost immediately. The drop was followed by a step-by-step climb up through the fibo levels, with almost no further retracements, on rising volume (I think I posted the details of that climb several pages ago in here). That's what I'd like to see again, after we'll see the (probably inevitable) next drop.

[oda.krell]

Above $534. First Fibonacci retracement level of entire downtrend broken.

Good news: we managed to decisively get above $534, the first (23.6%) retracement when looking at the entire downtrend so far, from ~1200 to ~340.

Note 1: I'm going to assume we close above, on daily. Failure to do so would be, hm, not so great.

Note 2: doesn't mean we're out of the danger zone entirely, in my opinion --  volume is still too low to say with certainty that we're going to see a sustained rally already. But it is what it is: a very positive signal. (2nd chart for comparison: what happened when we made it above 23% last year)


2014, Bitstamp




2013, Mtgox

[Tzupy]

Charts show most overbought since January, at the peak of wave B. For now this looks like a bull trap to me.

[MatTheCat]

Charts show most overbought since January, at the peak of wave B. For now this looks like a bull trap to me.

The waves resemble corrective (ABC) waves far more than impulse waves, yet the remaining long term down trend was broken through emphatically. This would have been a must buy-in point for me (~$540), but I was in my bed and Bitstamp's trading tools are fkn shit...so no facility for auto-triggering trade at certain price point. So I kind of missed my planned rebuy in point (I got $460 - $520) and am now in a real dilemma as to what move I should take. After all, Everyone was waiting on that long term resistance line being breached and it would be exactly this kind of market pushing that would allow whales to cash in on a rush of sentiment. Do I risk having my rush of sentiment cashed in on?

Whilst on paper, very significant bullish indicators have been breached, but perhaps this upswing has been far too vertical and must surely represent excessive market sentiment other than a sweeping groundswell of fresh interest in Bitcoin?

[segeln]

Charts show most overbought since January, at the peak of wave B. For now this looks like a bull trap to me.

no , most oversold,not overbought

[segeln]

. So I kind of missed my planned rebuy in point (I got $460 - $520) and am now in a real dilemma as to what move I should take. After all, Everyone was waiting on that long term resistance line being breached and it would be exactly this kind of market pushing that would allow whales to cash in on a rush of sentiment. Do I risk having my rush of sentiment cashed in on?

stop trading.you are not apt for that.
Just a troll and TA noob

[MatTheCat]

. So I kind of missed my planned rebuy in point (I got $460 - $520) and am now in a real dilemma as to what move I should take. After all, Everyone was waiting on that long term resistance line being breached and it would be exactly this kind of market pushing that would allow whales to cash in on a rush of sentiment. Do I risk having my rush of sentiment cashed in on?

stop trading.you are not apt for that.
Just a troll and TA noob

My recent buy-in plans would suggest otherwise. I caught one sweet, came out a bit early ($520) but intended to rebuy back in should a certain trend line be taken out.....it was, but I can't stay awake 24 hours.......


........and you are one to talk about being a TA noob......you fucking grade A HODLER you. Admit it, segeln, you are still underwater on Bitcoin. I have viewed your old posts.

Bitcoin at $1000 "Buy and Hold Buy and Hold"
Bitcoin at $800 "Buy and Hold Buy and Hold"

Cos when Bitcoin goes to $2000, them there will be good prices, right?

"Buy and Hold, Buy and Hold"

Fucking parrot clown.

[segeln]

grade A HODLER you. Admit it, segeln, you are still underwater on Bitcoin. .

yes I am still underwater. But as hodler this is not a Problem
Bought in at about 750 $ .My last buy was 350 $ 20  BTC
your gentlemanlike idoms/words are very impressive
But not my style

[MatTheCat]

grade A HODLER you. Admit it, segeln, you are still underwater on Bitcoin. .

yes I am still underwater. But as hodler this is not a Problem
Bought in at about 750 $
your gentlemanlike idoms/words are very impressive
But not my style

Strange that you admit it that.....

......but.....

If you are overall underwater, and despite me having had an utterly horrendous trade recently, I am still overall well in profit from my Bitcoin escapades.

Who are you to say that I am a noob trader?

I mean, I am a noob trader, but surely that is still a lot better a trader than what you are.

I have made money. You have lost money.

Edit: I fail for wasting mental energies on such a self-professed halfwit when I have better things to focus my efforts on (i.e. to buy or not to buy).

[segeln]

I have made money. You have lost money.

yeah, you are the  Warren Buffet of bitcoin

[ElectricMucus]

I have made money. You have lost money.

yeah, you are the  Warren Buffet of bitcoin

actually Mark Karples is the Warren Buffet of Buttcoin.

[oda.krell]

Charts show most overbought since January, at the peak of wave B. For now this looks like a bull trap to me.

I admit (as I did in the past) that I know very little about EW, and have even less confidence applying it correctly. So I can't directly say if I think you're right or not.

I will however point out that I'm under the impression that EW analysis, even more than other TA, is subject to extreme variance in results among those who practice it. With triangles, for example, the discussion was largely which extrema the resistance and support lines should go through exactly, or whether to use log or linear. With EW analysis, right now there seem to be those who imprint a bullish count on the charts, seeing us go a long way up (chessnut), those who see an extremely bearish count (DanV), and some in the middle, or who offer more than one possible count (waveaddict).

My point? I'm willing to believe EW is useful to those who know how to use it properly, but I'm not one of those people. So, in the absence of being able to look at the current situation through EW glasses, I will look at the (more tangible) signals that are accessible to me. And they look pretty good at the moment, both in the sense that I don't pick up an end to the current rally yet (if I had to guess, I'd say SMA200 could be the resistance that breaks its back), and that I see several signs that we did indeed find the bottom of the 2013/14 bear market at $340, and found buying support in the mid-$400s.

[MatTheCat]

Charts show most overbought since January, at the peak of wave B. For now this looks like a bull trap to me.

I admit (as I did in the past) that I know very little about EW, and have even less confidence applying it correctly. So I can't directly say if I think you're right or not.

I will however point out that I'm under the impression that EW analysis, even more than other TA, is subject to extreme variance in results among those who practice it. With triangles, for example, the discussion was largely which extrema the resistance and support lines should go through exactly, or whether to use log or linear. With EW analysis, right now there seem to be those who imprint a bullish count on the charts, seeing us go a long way up (chessnut), those who see an extremely bearish count (DanV), and some in the middle, or who offer more than one possible count (waveaddict).

My point? I'm willing to believe EW is useful to those who know how to use it properly, but I'm not one of those people. So, in the absence of being able to look at the current situation through EW glasses, I will look at the (more tangible) signals that are accessible to me. And they look pretty good at the moment, both in the sense that I don't pick up an end to the current rally yet (if I had to guess, I'd say SMA200 could be the resistance that breaks its back), and that I see several signs that we did indeed find the bottom of the 2013/14 bear market at $340, and found buying support in the mid-$400s.

I am a believer in EW in that it provides good cues for potential buy points and sell points whichever way the market goes and whether your counts are bearish or bullish. Indeed, I have both a bull count and a bear count on the go. I caught my first buy point at $460, but bottled out at $520. Again using EW principles, my next buy point was to be where price action breached the long term downtrend. This turned out to be $540, as I went to my bed, Bitcoin was creeping around up to $530, but there was nothing convincing me at that point to take a position.

When I got out my bed, Bitcoin was topping out at $586. We are now at $565. Although I am yet to be convinced that the bear trend has reversed, I feel that now that the Dec 2013 trendline has been breached, that a Wave (B) of a grander Wave [4] could take Bitcoin right up to $700s before correcting. However, we have already had a very vertical leg up and must surely now be in for some kind of meaningful correction (mind you, I was thinking this at $547). What would be your own short term view on Bitcoin with regards to timing a new market entry point?

[RyNinDaCleM]

Charts show most overbought since January, at the peak of wave B. For now this looks like a bull trap to me.

I admit (as I did in the past) that I know very little about EW, and have even less confidence applying it correctly. So I can't directly say if I think you're right or not.

I will however point out that I'm under the impression that EW analysis, even more than other TA, is subject to extreme variance in results among those who practice it. With triangles, for example, the discussion was largely which extrema the resistance and support lines should go through exactly, or whether to use log or linear. With EW analysis, right now there seem to be those who imprint a bullish count on the charts, seeing us go a long way up (chessnut), those who see an extremely bearish count (DanV), and some in the middle, or who offer more than one possible count (waveaddict).

My point? I'm willing to believe EW is useful to those who know how to use it properly, but I'm not one of those people. So, in the absence of being able to look at the current situation through EW glasses, I will look at the (more tangible) signals that are accessible to me. And they look pretty good at the moment, both in the sense that I don't pick up an end to the current rally yet (if I had to guess, I'd say SMA200 could be the resistance that breaks its back), and that I see several signs that we did indeed find the bottom of the 2013/14 bear market at $340, and found buying support in the mid-$400s.

That is one inherent problem with EW... 10 people will likely come up with 10 different but completely valid counts. Until they are invalidated, you don't know which is right! At any given time, I have 4+ counts going in my charts. Some are bullish and some are bearish. All have fibo and a special set of indicators I use just for counting. That way you have solid invalidation points to eliminate counts from the group.
I made a comment in the cryptowaves thread that you must confirm your counts with indicators. Otherwise, you let your own biases form your counts. Counting waves is just a way to see what is possible next. It's not intended to be a single trading system.

That all said, the rise from $339 to $550 does not look impulsive to me from an EW standpoint. This leads me to believe that this is a bull trap, and we are in the C-wave right now.  

[MatTheCat]

That all said, the rise from $339 to $550 does not look impulsive to me from an EW standpoint. This leads me to believe that this is a bull trap, and we are in the C-wave right now.  

Question is, how far up will the corrective Wave (c) go, before the final leg Wave [C] of the primary Wave 4 begins?

Also would there be an argument that

$340 - $547 - impulse Wave 1

$547 - $440 - corrective Wave 2 (Fib 67%)

$440 - $586  and counting (or perhaps not) impulse Wave 3.

If we are in a Wave 3, then we could have a long way to go from here. Although I do admit, the length and angle of the rallies do indeed suggest correction market psychology other than impulse market psychology.

[oda.krell]

When I got out my bed, Bitcoin was topping out at $586. We are now at $565. Although I am yet to be convinced that the bear trend has reversed, I feel that now that the Dec 2013 trendline has been breached, that a Wave (B) of a grander Wave [4] could take Bitcoin right up to $700s before correcting. However, we have already had a very vertical leg up and must surely now be in for some kind of meaningful correction (mind you, I was thinking this at $547). What would be your own short term view on Bitcoin with regards to timing a new market entry point?

I wish I had one. If I would have been caught with my pants down (i.e. asleep :P), I'd probably be buying in even now, but be on the watch for reversals at the well known resistances, or after a simple failure to sustain momentum. The risk that we break through, say 630 anyway, and you'll be forced to buy in at that level would be too big for me. I /do/ think there's a good chance we'll see 550, or even 530 again in the next days, even if we sustain momentum overall, but bet on it? I don't think I would.

[RyNinDaCleM]

That all said, the rise from $339 to $550 does not look impulsive to me from an EW standpoint. This leads me to believe that this is a bull trap, and we are in the C-wave right now.  

Question is, how far up will the corrective Wave (c) go, before the final leg Wave [C] of the primary Wave 4 begins?

Also would there be an argument that

$340 - $547 - impulse Wave 1

$547 - $440 - corrective Wave 2 (Fib 67%)

$440 - $586  and counting (or perhaps not) impulse Wave 3.

If we are in a Wave 3, then we could have a long way to go from here. Although I do admit, the length and angle of the rallies do indeed suggest correction market psychology other than impulse market psychology.

That wave 1 is what I'm talking about. It appears more to be a 3 wave structure than a 5 waver. To force a 5 wave count to it, leaves the 4 very disproportionate to the 2. While it is possible, I guess, it isn't my first count because of the this. As a C of (B), it could really stop anywhere, unfortunately. (B) can even make new ATH's. If it's a 3 of V (or iii of 1 of V..) then it has more limits.

My original target for a large B wave was this;


The lower end is a minimum (61.8% of the 'a' from $339-547) that C had to travel to be considered complete (ie. ~$550). The upper end is the 61.8% fibo retrace of the whole bear market thus far (~$850).

[MatTheCat]

That wave 1 is what I'm talking about. It appears more to be a 3 wave structure than a 5 waver. To force a 5 wave count to it, leaves the 4 very disproportionate to the 2. While it is possible, I guess, it isn't my first count because of the this. As a C of (B), it could really stop anywhere, unfortunately. (B) can even make new ATH's. If it's a 3 of V (or iii of 1 of V..) then it has more limits.

My original target for a large B wave was this;


The lower end is a minimum (61.8% of the 'a' from $339-547) that C had to travel to be considered complete (ie. ~$550). The upper end is the 61.8% fibo retrace of the whole bear market thus far (~$850).

This chart looks very similar (identical) to one of the EW possibilities that I have got on the go. But since I missed my last buy-in trigger due to being 'off duty', I am now in this quandary whether to buy in at a point where we have come very high in a short space of time without any meaningful correction. There is clearly some kind of consolidation phase underway but will be break up or correct back down to $50+?

I wish I had one. If I would have been caught with my pants down (i.e. asleep ), I'd probably be buying in even now, but be on the watch for reversals at the well known resistances, or after a simple failure to sustain momentum. The risk that we break through, say 630 anyway, and you'll be forced to buy in at that level would be too big for me. I /do/ think there's a good chance we'll see 550, or even 530 again in the next days, even if we sustain momentum overall, but bet on it? I don't think I would.

We are right on a very prominent resistance point, and consolidating. I have been in ($565) and out ($572) of the market during this consolidation phase. I can't make head nor tails of it but since we have come so far (over $100) in such a short space of time without anything more than a 20% correction after any leg up, the probability of 'thee correction' occurring becomes greater and greater. Instead of faffing around with a big pile of short term indicators that amount to nothing more than random noise at the end of the day, If I am to re-enter long, then I will have to see the $585 being taken out at volume. Annoying, considering I did have the correct plan of action in place had I been around to act on it. If I am in bed again when what ever entity is driving this rally starts ramping again, then so be it.

[T.Stuart]

When I got out my bed, Bitcoin was topping out at $586. We are now at $565. Although I am yet to be convinced that the bear trend has reversed, I feel that now that the Dec 2013 trendline has been breached, that a Wave (B) of a grander Wave [4] could take Bitcoin right up to $700s before correcting. However, we have already had a very vertical leg up and must surely now be in for some kind of meaningful correction (mind you, I was thinking this at $547). What would be your own short term view on Bitcoin with regards to timing a new market entry point?

I wish I had one. If I would have been caught with my pants down (i.e. asleep ), I'd probably be buying in even now, but be on the watch for reversals at the well known resistances, or after a simple failure to sustain momentum. The risk that we break through, say 630 anyway, and you'll be forced to buy in at that level would be too big for me. I /do/ think there's a good chance we'll see 550, or even 530 again in the next days, even if we sustain momentum overall, but bet on it? I don't think I would.

If I've got this right you are in earlier than you were planning a couple of weeks ago am I right?

What was your planned buy-in point a couple of weeks ago compared with the price you actually bought in, if I may ask?

[MatTheCat]

If I've got this right you are in earlier than you were planning a couple of weeks ago am I right?

What was your planned buy-in point a couple of weeks ago compared with the price you actually bought in, if I may ask?

If you are talking to me:

I had buy-ins lined up at $360-$400. As Bitcoin stagnated in the $430-$450 range, I was waiting for convincing confirmation of breach of either of the long term support or resistance trendlines which were converging. In the end, it was the resistance line which was convincingly breached, and I went long at $460. Suspecting a pull-back, I sold at $520. Realising that I had probably made a mistake, was waiting on breach of final long term resistance line before deciding upon whether to re-enter market. Had I been awake at 4am UK time, I would have re-entered market at $540, but I was asleep. When I awoke, Bitcoin was topping out at $586. I have since 'dabbled' with a long position which I have since closed as I have decided that taking a position at the moment would only be gambling. If Bitcoin can take out the $586 high, again, on convincing volume, then I may take another long, but the higher up this vertical break-out we get, the greater the probability of a brutal correction there will be. I wish hadn't closed my $460 long position, but too many times in the past, have I failed to take profits and then had the market turn on me, sometimes viciously.

[m3g4tr0n]

It's what I believe is going to happen, so I went full fiat at 512 with the hope of buying back around 375-400 before mid may. Wish me luck

I'm sure I don't need to tell you this, but I hope you also set a stop-loss to buy back in. Decide, ahead of time, at which price you'll have to consider your previous assumptions to be proven wrong by the market, and then stick to it.

1d Ichimoku cloud comes to mind, or daily SMA200. But, whatever you pick, don't go back on your decision later unless you have extremely good reasons to do so.

If it breaks 550 on stamp...

And here we are.

[T.Stuart]

If I've got this right you are in earlier than you were planning a couple of weeks ago am I right?

What was your planned buy-in point a couple of weeks ago compared with the price you actually bought in, if I may ask?

If you are talking to me:

I had buy-ins lined up at $360-$400. As Bitcoin stagnated in the $430-$450 range, I was waiting for convincing confirmation of breach of either of the long term support or resistance trendlines which were converging. In the end, it was the resistance line which was convincingly breached, and I went long at $460. Suspecting a pull-back, I sold at $520. Realising that I had probably made a mistake, was waiting on breach of final long term resistance line before deciding upon whether to re-enter market. Had I been awake at 4am UK time, I would have re-entered market at $540, but I was asleep. When I awoke, Bitcoin was topping out at $586. I have since 'dabbled' with a long position which I have since closed as I have decided that taking a position at the moment would only be gambling. If Bitcoin can take out the $586 high, again, on convincing volume, then I may take another long, but the higher up this vertical break-out we get, the greater the probability of a brutal correction there will be. I wish hadn't closed my $460 long position, but too many times in the past, have I failed to take profits and then had the market turn on me, sometimes viciously.

Thanks Mat! What about you, Oda Krell?

[zimmah]

Short term prediction:

it will test and bounce $630 tomorrow
it will break $630 somewhere the 28th or 29th, or in a bearish case, June 1st.

I think the chances of this short term prediction happening are about 80%

[oda.krell]

If I've got this right you are in earlier than you were planning a couple of weeks ago am I right?

What was your planned buy-in point a couple of weeks ago compared with the price you actually bought in, if I may ask?

No, not really. Short recap, maybe:

I wrote a long post about the bearish triangle variants on April 25th, see here. That one guided me as far as the time frame was concerned -- convergence scenario #1 was predicted for late May at the latest, and the actual breakout was May 20, so it was pretty accurate. At the time of that post, I was still rather bearish, expecting we'd probably see a breakout to the downside. Maybe that's what you have in mind when you say "earlier than I planned"?

On May 16th I posted about a new observation that, based on MFI (a money flow oscillator), it looked like we had finally found sufficient buying support at the given price level. See the post here. From that point on I was, as I wrote, "cautiously bullish".

By May 20, MFI had continued to develop exactly as I hoped it would, so I didn't hesitate much when the breakout happened. I'm in since about 460, not tempted to sell (yet).

[MatTheCat]

I'm in since about 460, not tempted to sell (yet).

You got in about the same time as me, but you have managed to hold out for around double the increases that I emptied into my Bitstamp account....

....However, are you not of the opinion that things are beginning to look a bit shit?

4hr CMF showing negative divergence, 4hr RSI showing negative divergence, 4hr Stochastic RSI maxed and pointing/crossing down, very low volume after we have had the first mammoth red candle which dwarfed the green candles around it, at least on the shorter time frames ($586-$560 within 5 minutes which entailed some 1500 BTC sell off within that time frame)?

There could be a few pennies more in this rally, but as annoyed as I am by not getting back in at $540, there is absolutely no way would I risk a long position at this point in time. For me to be encouraged to long right now, there would have to be a shit storm of buying pressure to come in and take Bitcoin at these prices. Is it going to happen? (if it does, no doubt I will be asleep)

Zooming out, the chart still looks good, but with so many traders relying on 4Hr parameters, I could certainly see the buying pressure ease off for now. To what extent selling pressure/profit taking sets in, remains to be seen.

Edit: Large walls set up and getting chewed up as I type. Seems like big break out is on...bought back in on impulse at $571.....hope I don't regret it when I look at charts in morning.

Edit 2: Started on Huobi AGAIN. This is all coming from China. Every single time almost. Worrying?

[windjc]

I'm in since about 460, not tempted to sell (yet).

You got in about the same time as me, but you have managed to hold out for around double the increases that I emptied into my Bitstamp account....

....However, are you not of the opinion that things are beginning to look a bit shit?

4hr CMF showing negative divergence, 4hr RSI showing negative divergence, 4hr Stochastic RSI maxed and pointing/crossing down, very low volume after we have had the first mammoth red candle which dwarfed the green candles around it, at least on the shorter time frames ($586-$560 within 5 minutes which entailed some 1500 BTC sell off within that time frame)?

There could be a few pennies more in this rally, but as annoyed as I am by not getting back in at $540, there is absolutely no way would I risk a long position at this point in time. For me to be encouraged to long right now, there would have to be a shit storm of buying pressure to come in and take Bitcoin at these prices. Is it going to happen? (if it does, no doubt I will be asleep)

Zooming out, the chart still looks good, but with so many traders relying on 4Hr parameters, I could certainly see the buying pressure ease off for now. To what extent selling pressure/profit taking sets in, remains to be seen.

Edit: Large walls set up and getting chewed up as I type. Seems like big break out is on...bought back in on impulse at $571.....hope I don't regret it when I look at charts in morning.

Edit 2: Started on Huobi AGAIN. This is all coming from China. Every single time almost. Worrying?

Houbi is in control because Stamp and Finex are 95%+ traders who have money on sidelines to invest or trade with. 

We need fresh fiat to the exchanges for Houbi not to lead.

[JustAnotherSheep]

According to my favorite techniques (fibhorn and ratio analysis), 605 or 615~ seem like reasonable targets for either local tops or major ones for the rally from the triangle breakout, though an experimental resistance line at 620 or daily SMA200 (currently at 640) could also be it.
Long-term support line currently at $470, if it's tested and holds I guess the trend reversal will be confirmed 100% (not making this just a bulltrap or Wave B of C (same thing I suppose)).

[oda.krell]

Edit 2: Started on Huobi AGAIN. This is all coming from China. Every single time almost. Worrying?

Not really. The entire rally (from $450) started, within <15 min of each other, on stamp and huobi simultaneously, with them taking turns in getting new (relative, of course) volume highs after the breakout. I take that as a reasonably organic start.

What happened afterwards is another matter, but I'm not going to let the old adage that we need fresh fiat guide my trading mechanically. I'd suggest taking profits if and when it becomes apparent that the current rally ran out of steam, not earlier, unless you know with some certainty ahead of time the inflection point peak. But as always: different trading styles, different recommended actions.

[T.Stuart]

If I've got this right you are in earlier than you were planning a couple of weeks ago am I right?

What was your planned buy-in point a couple of weeks ago compared with the price you actually bought in, if I may ask?

No, not really. Short recap, maybe:

I wrote a long post about the bearish triangle variants on April 25th, see here. That one guided me as far as the time frame was concerned -- convergence scenario #1 was predicted for late May at the latest, and the actual breakout was May 20, so it was pretty accurate. At the time of that post, I was still rather bearish, expecting we'd probably see a breakout to the downside. Maybe that's what you have in mind when you say "earlier than I planned"?

On May 16th I posted about a new observation that, based on MFI (a money flow oscillator), it looked like we had finally found sufficient buying support at the given price level. See the post here. From that point on I was, as I wrote, "cautiously bullish".

By May 20, MFI had continued to develop exactly as I hoped it would, so I didn't hesitate much when the breakout happened. I'm in since about 460, not tempted to sell (yet).

Thanks for the recap. I can't find the post in particular (admit have not looked very hard) but remember you saying that you would not enter until sure of a reversal (and if I remember correctly that was at least in the 500s if not 600s in your opinion at the time) because you were in profit anyway so it didn't really matter.

Just trying to understand people's changing perspectives. The posts you made since (that you mention above) explain...

[windjc]

Edit 2: Started on Huobi AGAIN. This is all coming from China. Every single time almost. Worrying?

Not really. The entire rally (from $450) started, within <15 min of each other, on stamp and huobi simultaneously, with them taking turns in getting new (relative, of course) volume highs after the breakout. I take that as a reasonably organic start.

What happened afterwards is another matter, but I'm not going to let the old adage that we need fresh fiat guide my trading mechanically. I'd suggest taking profits if and when it becomes apparent that the current rally ran out of steam, not earlier, unless you know with some certainty ahead of time the inflection point. But as always: different trading styles, different recommended actions.

As most always, we are in agreement.

Although we are entering the zone where I am watching for weakness like a hawk. Finex is leveraged at close to 19 million (down to 17.5), and the rates have skyrocketed, meaning, in my opinion, that fiat is getting tapped out there.

How much is sitting in Houbi on the sidelines? How much can secretly get into that exchange. How much is sitting in Stamp and Finex, untouched? These would be great inside information.  

Can we expect new fiat this week? I am a little skeptical, but hell we are in a full on bull run, so maybe I shouldn't be.

[oda.krell]

As most always, we are in agreement.

Although we are entering the zone where I am watching for weakness like a hawk. Finex is leveraged at close to 19 million, and the rates have skyrocketed, meaning, in my opinion, that fiat is getting tapped out there.

How much is sitting in Houbi on the sidelines? How much can secretly get into that exchange. How much is sitting in Stamp and Finex, untouched? These would be great inside information. :)  

Can we expect new fiat this week? I am a little skeptical, but hell we are in a full on bull run, so maybe I shouldn't be.

Yes, I'm sure I know the feeling... but I realized also that, right now, I can't pick up with certainty whether we're done yet with this rally, so the best I can do is set (mentally) a stop sell that makes sense to me, and wait whether it comes to that, i.e. while I prefer to go "predictive momentum" usually, this time, I'll have to go "full momentum"... cue: never go full momentum.jpg :P

[windjc]

As most always, we are in agreement.

Although we are entering the zone where I am watching for weakness like a hawk. Finex is leveraged at close to 19 million, and the rates have skyrocketed, meaning, in my opinion, that fiat is getting tapped out there.

How much is sitting in Houbi on the sidelines? How much can secretly get into that exchange. How much is sitting in Stamp and Finex, untouched? These would be great inside information.  

Can we expect new fiat this week? I am a little skeptical, but hell we are in a full on bull run, so maybe I shouldn't be.

Yes, I'm sure I know the feeling... but I realized also that, right now, I can't pick up with certainty whether we're done yet with this rally, so the best I can do is set (mentally) a stop sell that makes sense to me, and wait whether it comes to that, i.e. while I prefer to go "predictive momentum" usually, this time, I'll have to go "full momentum"... cue: never go full momentum.jpg

Well I'm full BTC. But I closed out my extra leveraged longs for the same reason. If we consolidate under $600 I will leverage up again, because a rally never ends without a large flame out. So a consolidation at these levels would signal a run to $630+ in my books. Then I would really be watching for exhaustion. Rinse, repeat.

[MatTheCat]

Not really. The entire rally (from $450) started, within <15 min of each other, on stamp and huobi simultaneously, with them taking turns in getting new (relative, of course) volume highs after the breakout. I take that as a reasonably organic start.

What happened afterwards is another matter, but I'm not going to let the old adage that we need fresh fiat guide my trading mechanically. I'd suggest taking profits if and when it becomes apparent that the current rally ran out of steam, not earlier, unless you know with some certainty ahead of time the inflection point. But as always: different trading styles, different recommended actions.

Your charts also demonstrate that Huobi kicks off proceedings, each time, and that Bitstamp follows.

With regards to your thoughts on whether the rally was running out of steam, I would say that we seem to have a bit of a closing diagonal formation occurring that might suggest the bullish sentiment being met with exhaustion. Since I only came back in the trade at $571, I am out again now at $584. Far greater probability of the market reversing over my toes than going much further in my favour at this point.

Negative divergence continues to raise it's head on the 4hr and shorter indicators (RSI, CMF) as volume continues to drop with each successive peak. I say we have had the top, or that the final top will be just a few dollars more.

[windjc]

Not really. The entire rally (from $450) started, within <15 min of each other, on stamp and huobi simultaneously, with them taking turns in getting new (relative, of course) volume highs after the breakout. I take that as a reasonably organic start.

What happened afterwards is another matter, but I'm not going to let the old adage that we need fresh fiat guide my trading mechanically. I'd suggest taking profits if and when it becomes apparent that the current rally ran out of steam, not earlier, unless you know with some certainty ahead of time the inflection point. But as always: different trading styles, different recommended actions.

Your charts also demonstrate that Huobi kicks off proceedings, each time, and that Bitstamp follows.

With regards to your thoughts on whether the rally was running out of steam, I would say that we seem to have a bit of a closing diagonal formation occurring that might suggest the bullish sentiment being met with exhaustion. Since I only came back in the trade at $571, I am out again now at $584. Far greater probability of the market reversing over my toes than going much further in my favour at this point.

Negative divergence continues to raise it's head on the 4hr and shorter indicators (RSI, CMF) as volume continues to drop with each successive peak. I say we have had the top, or that the final top will be just a few dollars more.

Maybe. Or maybe we just rest for a day or two before exploding north again.

[JustAnotherSheep]

With regards to your thoughts on whether the rally was running out of steam, I would say that we seem to have a bit of a closing diagonal formation occurring that might suggest the bullish sentiment being met with exhaustion. Since I only came back in the trade at $571, I am out again now at $584. Far greater probability of the market reversing over my toes than going much further in my favour at this point.

Negative divergence continues to raise it's head on the 4hr and shorter indicators (RSI, CMF) as volume continues to drop with each successive peak. I say we have had the top, or that the final top will be just a few dollars more.

I agree. The rising wedge(s?) in particular does not seem to support the bull run going much farther. Not to mention the fact that daily MACD is at approximately the same level as the peak of the post-bubble bulltrap (379-998), and daily RSI shows we're overbought atm (at least I think so, still a noob to these indicators so someone correct me if I'm wrong).



Also, an interesting fact is that the (initial, at least) wedge closes at $647, which is just a few dollars above SMA200. Coincidence?

[MatTheCat]

and daily RSI shows we're overbought atm (at least I think so, still a noob to these indicators so someone correct me if I'm wrong).

RSI on 4 hour chart is showing signs of negative divergence.

Bitcoin at $530 - RSI ~ 90
Bitcoin at $545 - RSI ~ 94
Bitcoin at $586 - RSI ~ 87
Bitcoin at $593 - RSI ~ 86

Shorter term (30 mins) chart indicators perhaps show things a little clearer that some kind of correction is likely on the cards, of course, price can still rise quite a bit as these indicators continue to trend lower, before the canary finally chokes, so to say:

[studio1one]

With regards to your thoughts on whether the rally was running out of steam, I would say that we seem to have a bit of a closing diagonal formation occurring that might suggest the bullish sentiment being met with exhaustion. Since I only came back in the trade at $571, I am out again now at $584. Far greater probability of the market reversing over my toes than going much further in my favour at this point.

Negative divergence continues to raise it's head on the 4hr and shorter indicators (RSI, CMF) as volume continues to drop with each successive peak. I say we have had the top, or that the final top will be just a few dollars more.

I agree. The rising wedge(s?) in particular does not seem to support the bull run going much farther. Not to mention the fact that daily MACD is at approximately the same level as the peak of the post-bubble bulltrap (379-998), and daily RSI shows we're overbought atm (at least I think so, still a noob to these indicators so someone correct me if I'm wrong).



Also, an interesting fact is that the (initial, at least) wedge closes at $647, which is just a few dollars above SMA200. Coincidence?

alternatively, looking at the run as a whole



the rise is diverging, not converging.

[MatTheCat]

the rise is diverging, not converging.

and if you want to zoom further out and take the last two highs and the last two lows, we again have a rising converging diagonal:



The TA 101-ist, has to decide what kind of ranges are most useful to him and this requires common sense.

[studio1one]

the rise is diverging, not converging.

and if you want to zoom further out and take the last two highs and the last two lows, we again have a converging diagonal:



But the TA 101-ist, has to decide what kind of ranges are most useful to him and this requires common sense.

Agreed,

for me the rising wedges shown in the first pic are each stage of the rise. It rises to the peak-ish, levels out then starts another rise. Each stage definitely runs out of steam, then we level off until the next rise.

For me, looking at the current rise as a whole, from where it started at around 450 there is no wedge forming at all, in fact the opposite. Volume is rising each rise on Huobi, and around stagnant on stamp.

Also 3 day moving average is about to cross for the first time since Feb.

Firm bull still here.

As this is being led by Huobi I don't see the current run running out of steam at all just yet.

[JustAnotherSheep]

Agreed,

for me the rising wedges shown in the first pic are each stage of the rise. It rises to the peak-ish, levels out then starts another rise. Each stage definitely runs out of steam, then we level off until the next rise.

For me, looking at the current rise as a whole, from where it started at around 450 there is no wedge forming at all, in fact the opposite. Volume is rising each rise on Huobi, and around stagnant on stamp.

Also 3 day moving average is about to cross for the first time since Feb.

Firm bull still here.

As this is being led by Huobi I don't see the current run running out of steam at all just yet.

Ah, good points, especially regarding Huobi. Just took a look and there doesn't even seem to be any wedge formation(s) on that exchange, so maybe they can keep dragging Bearstamp along (if the wedges are valid in the first place, that is).

Nevertheless, daily RSI is still overbought on both exchanges, although this doesn't necessarily have to signify a very huge drop I realized, as during 2013 it also got into overbought territory once before the bubble, and this was only followed by a correction of $130-115 (as well as a longer period of consolidation) before resuming the rise (disregarding the SR flashcrash).

[oda.krell]

Nevertheless, daily RSI is still overbought on both exchanges, although this doesn't necessarily have to signify a very huge drop I realized, as during 2013 it also got into overbought territory once before the bubble, and this was only followed by a correction of $130-115 (as well as a longer period of consolidation) before resuming the rise (disregarding the SR flashcrash).

As a general rule (and I say that as someone who's also still learning pretty much the basics), seeing an overbought/oversold condition and making a decision (mainly) based on that is not a good idea.

Example: daily RSI was overbought on October 23rd, November 9th and November 19th. Only on the last date, I'd argue, would it have been profitable (after slippage and fees) to sell and re-buy (fast!), because the drop in all other cases was barely noticeable. In either case, after a possible sell you better would have went in immediately, because  price still had a long way to go until the inflection point peak of the bubble.

But taken together, the 3 RSI overbought conditions formed a nice rising sequence, confirming the uptrend until late November. November 30th and December 4th saw rising (or level) price highs, but declining RSI highs, i.e. a regular bearish divergence. So RSI analysis was after all capable of indicating that a reversal was overdue, but only taking all the RSI peaks together.

So that's how I try to read oscillators like RSI: overbought/oversold conditions are at first just a "warning" signal that you need to look at the context around those peaks. But the actual conclusion what the indicator tells you is a bit more complicated than concluding that we're going down or up (substantially) because of the overbough/sold condition.

[JustAnotherSheep]

Nevertheless, daily RSI is still overbought on both exchanges, although this doesn't necessarily have to signify a very huge drop I realized, as during 2013 it also got into overbought territory once before the bubble, and this was only followed by a correction of $130-115 (as well as a longer period of consolidation) before resuming the rise (disregarding the SR flashcrash).

As a general rule (and I say that as someone who's also still learning pretty much the basics), seeing an overbought/oversold condition and making a decision (mainly) based on that is not a good idea.

Example: daily RSI was overbought on October 23rd, November 9th and November 19th. Only on the last date, I'd argue, would it have been profitable (after slippage and fees) to sell and re-buy (fast!), because the drop in all other cases was barely noticeable. In either case, after a possible sell you better would have went in immediately, because  price still had a long way to go until the inflection point of the bubble.

But taken together, the 3 RSI overbought conditions formed a nice rising sequence, confirming the uptrend until late November. November 30th and December 4th saw rising (or level) price highs, but declining RSI highs, i.e. a regular bearish divergence. So RSI analysis was after all capable of indicating that a reversal was overdue, but only taking all the RSI peaks together.

So that's how I try to read oscillators like RSI: overbought/oversold conditions are at first just a "warning" signal that you need to look at the context around those peaks. But the actual conclusion what the indicator tells you is a bit more complicated than concluding that we're going down or up (substantially) because of the overbough/sold condition.

Fair enough, yeah makes sense.

Naturally I won't be basing any trade decisions solely on RSI (particularly not when I'm such a noob with it ) but rather in combination with other analysis. Though it should be noted that the October and November cases you mention were all during the bubble, when (I assume) overbought RSI should be the rule rather than exception, and the example I mentioned (August 2013) was well before the bubble, so from this one might infer that RSI being overbought outside of bubbles acts as a stronger sell-indicator. But then of course there is the problem with knowing how long it will stay overbought, and how high it will go, which (as previously mentioned) necessitates one using other indicators in combination to make any hard decisions.

Though, looking at historic timescale on Stamp, I just noticed an interesting pattern: For every case of (daily) RSI being overbought outside of bubbles, the RSI top has been extremely consistent before price went down/consolidated: 83-85 (what do you even call that, RSI level?). Currently we're on 79, which according to this would give us some more room to go before the hypothesized correction (also assuming this is not the start of a bubble, which I doubt). Curious to see if this pattern holds again.

[bassclef]

RSI can stay overbought/oversold for a long time in strong bull/bear markets.

If yore going to be calling bubble tops with it use a long time period, like 3d or weekly.

[igorr]

RSI can stay overbought/oversold for a long time in strong bull/bear markets.

If yore going to be calling bubble tops with it use a long time period, like 3d or weekly.

Willy bot creates RSI indicator and the price and chart.

[oda.krell]

Fair enough, yeah makes sense.

Naturally I won't be basing any trade decisions solely on RSI (particularly not when I'm such a noob with it ) but rather in combination with other analysis. Though it should be noted that the October and November cases you mention were all during the bubble, when (I assume) overbought RSI should be the rule rather than exception, and the example I mentioned (August 2013) was well before the bubble, so from this one might infer that RSI being overbought outside of bubbles acts as a stronger sell-indicator. But then of course there is the problem with knowing how long it will stay overbought, and how high it will go, which (as previously mentioned) necessitates one using other indicators in combination to make any hard decisions.

Though, looking at historic timescale on Stamp, I just noticed an interesting pattern: For every case of (daily) RSI being overbought outside of bubbles, the RSI top has been extremely consistent before price went down/consolidated: 83-85 (what do you even call that, RSI level?). Currently we're on 79, which according to this would give us some more room to go before the hypothesized correction (also assuming this is not the start of a bubble, which I doubt). Curious to see if this pattern holds again.

I like the approach: segment our data into different types of periods (I'm trying for now: bubble-rally, bubble-deflation, consolidation-upwards, consolidation-downwards) and see how RSI behaves in each segment. Playing around with it myself now.

[MatTheCat]

Here is some Elliot Wave analysis depicting where I believe we are in Bitcoin's price discovery progression. The chart shows that we may be in the midst of a counter trend  Wave B, after having had a corrective Wave A, which consisted of a clean 5-3-5-3-5 impulse move down:





The next chart below, shows the possible development of a leading diagonal Wedge formation. Important to note, is that the support line for this wedge traces back to Jan 2013, and was the support line which was tested just a couple of days prior to the break out above the Jan 2014 resistance line. The resistance line shown in red, is from the Dec 2013 highs. It was also broken through at $540 mark:




Below, is a 4hour Bitstamp chart showing that the support line for the $440 - $595 rise has been breached, with a parallel down channel showing likely price trend over coming days. Note also the negative divergence of the RSI, and also the maxed out state of the MACD. The two reddish lines on the chart are the 38% and 50% Fib retracement targets. This is where I believe the correction is likely to stop and find support for next leg up of wedge. Should Bitcoin trend lower than this and touch and/or get beyond the 61% Fib retracement line around the same time (or before) the projected parallel trading channel meets it, then this could show itself to be a critical turning point which renders this TA null and void, as the lower blue support line, is not just the support for the wedge, but a long term support since Jan 2013:





This final chart indicates that if the Wedge Support line is breached, then we could assume that Wave B has played out between $340 and $595, and that Wave C will have begun. At this point in time however, I am not thinking this is going to play out:




Summary:

Short Term: Bitcoin to trend down to $500

Medium Term: Bitcoin to continue to zig zag in rising diagonal formation shown, ultimately breaking out and reaching 50% Fib retracement zone (~$750) marking $1160 - $340 correction.

Long term: Bitcoin to $200.

[RandomPedestrianN9]

You DA MAN Mat! Bang all the bagholders!

[jamesc760]

MTC:
"Long term: Bitcoin to $200."

You should be a standup comedian.

So funny. It just shows you how anyone can do TA and make it fit your own personal view.

I know you're going to go verbal on me for saying it. But, I will always cherish your point of view, however bearish it may be.

[oda.krell]

[snip]

Short Term: Bitcoin to trend down to $500

Medium Term: Bitcoin to continue to zig zag in rising diagonal formation shown, ultimately breaking out and reaching 50% Fib retracement zone (~$750) marking $1160 - $340 correction.

Possible. The rising wedge you see is definitely an option, and (at conclusion) has a bearish bias. But:

Long term: Bitcoin to $200.

...is kind of out there. To conclude that, based on your currently favored wave count, we're going up until late August, then will break down to a new correction low is a bit too speculative for my taste.

[MatTheCat]

Long term: Bitcoin to $200.

...is kind of out there. To conclude that, based on your currently favoured wave count, we're going up until late August, then will break down to a new correction low is a bit too speculative for my taste.

And for my taste also to let the truth be told, but speculating such a negative figure, so far off in the distance, way beyond the mountains can prove useful nonetheless in that it provides a reminder that the bull market correction isn't over until it is confirmed as over. I can remember at least two times (Jan 2014, March 2013) in recent Bitcoin price history where even I was convinced that the bear trend was behind us and new ATH's were on the way, only for the reality of the situation to bite me on the arse, twice.

I never knew anything about EW theory back then, but if I had, I may not have been so confident that Bitcoin was going 2 da moon. Just recently, I watched a video of a DanV Session on youtube. This was back right on the very eve of the Jan 6th 2014 $995 high. DanV was of course using MtGox to chart Bitcoin but even at this point, when the 'euphoria' was reaching its peak as Bitcoin shot through $1000 on 'Zynga news' (LOL), his adherence to EW principles lead him to the conclusion that we would have to retest the $450 low (MtGox). He was of course ridiculed and laughed off the internet, but we all know what has happened since then.

Perhaps the top of the corrective Wave B will coincide with official media confirmation that Bitcoin's astronomical rise in 2013 was largely due to fake volume generated by Willy n Markus on Gox, raising the question of similar pet fraudulent trading bots on the other large exchanges?

Point is, it looks to my eyes that we have just had a classic Wave A down, consisting of a clean 5-3-5-3-5 impulse wave down, with correspondingly appropriate fractal waves within them. Now it seems like we are on a Wave B. Lots can happen, but I think most people here understand what the most text book example of an ABC corrective wave is.

[oda.krell]

Here's the best guess I have about our situation: We're trading inside the following upwards channel for now:



We could go straight up from here, breaking out of the channel (yellow line. not that likely anymore, in my opinion), we could test the mid line and find support (quite possible), we could test the lower boundary and find support (less likely, but possible), or we could break through the lower boundary (not likely right now).

(EDIT: none of the lines defining that channel are strongly motivated, but I take the fact that they form a (rough) parallel channel as a bit of evidence in favor of them. Point being, actual support and resistance might be more closely located around fib levels and running averages in the vicinity of those lines than around the exact lines marking the channel itself.)

Everything but the blue line is pretty bullish (except for a bit of swinging around). Everything that comes after this channel requires a level of predictive power I personally can't find motivation for right now.

[MatTheCat]

Everything but the blue line is pretty bullish (except for a bit of swinging around). Everything that comes after this channel requires a level of predictive power I personally can't find motivation for right now.

Your pink line, crashes right through the trend line which was tested last week around $440, met at the $340 bottom, met again in the Oct Silk Road Crash, and trended along in Jan 2013.

If your pink line comes to pass, I would need to look at only shorting Bitcoin as a long term uptrend would be confirmed as finished, which would of course mean that we would be in a downtrend.

[oda.krell]

Everything but the blue line is pretty bullish (except for a bit of swinging around). Everything that comes after this channel requires a level of predictive power I personally can't find motivation for right now.

Your pink line, crashes right through the trend line which was tested last week around $440, met at the $340 bottom, met again in the Oct Silk Road Crash, and trended along in Jan 2013.

If your pink line comes to pass, I would need to look at only shorting Bitcoin as a long term uptrend would be confirmed as finished, which would of course mean that we would be in a downtrend.

Not by my analysis. I have argued strenuously in here that I see strong evidence of (natural) buying support in the mid 400s. You're free to reject that conclusion obviously, but by my interpretation, pink line would just be 'ever so weakly upwards leaning consolidation'.

Basically, broken trendline doesn't mean much to me if there's a stronger factor in the back of my mind. Short term, it would be bearish, sure: we'd go below the 23% fib 1200-340, which means you'll hear the bulls cry again. Could be however that breaking through it without closing under it is the confirmation we need that we're out of the larger downtrend for good.

EDIT: and that particular trendline, the one that goes through the SR crash, is not a favorite of mine anyway. SR is a borderline outlier, so I weigh it less to begin with, it's far far in the past, with zero point between then and now even getting close to it, and it's angle is way too steep to really be a realistic line of support. the trendline that formed the triangle I looked at (until we broke out 9 days ago) was simply the slightly rising support through ~400.

[oda.krell]

Here's the best guess I have about our situation: We're trading inside the following upwards channel for now:



We could go straight up from here, breaking out of the channel (yellow line. not that likely anymore, in my opinion), we could test the mid line and find support (quite possible), we could test the lower boundary and find support (less likely, but possible), or we could break through the lower boundary (not likely right now).

(EDIT: none of the lines defining that channel are strongly motivated, but I take the fact that they form a (rough) parallel channel as a bit of evidence in favor of them. Point being, actual support and resistance might be more closely located around fib levels and running averages in the vicinity of those lines than around the exact lines marking the channel itself.)

Everything but the blue line is pretty bullish (except for a bit of swinging around). Everything that comes after this channel requires a level of predictive power I personally can't find motivation for right now.

So much for the upper boundary of that channel... broken, after just a short 4 day breather. In the end there was only little resistance at 600 -- partly because the orderbook is pretty empty. Yay for sellers' exhaustion! (12k coins asks in total on Bitstamp order book vs. 24k about a month ago)




Next likely point of resistance? Probably daily SMA200, currently ~640. No idea whether we can make it through that one as well, but I'm skeptical... it's starting to look a bit overextended to me. No good reason I can see to go short though, if you're only aiming to sell on the big swings down.

[seleme]

200 SMA won't go without a fight but if it does, then we might be into something 

[Bitcoin_is_here_to_stay]

200 SMA won't go without a fight but if it does, then we might be into something 

If it was ~640, it is left far behind ... Does bitcoin ever corrects properly in the bull market, or do we only have flat price action instead of corrections? So far there was not a meaningful correction since the breakout from $450 happened 

[igorr]

Willy bot working hard to rise up the bitcoin price, and trying to adapt us to the new level price,
but this will be short term, and after that coming final fall and bitcoin the end.
Bistamp or or any other exchange will be shutdown.
(mining factor will be below 1 cents per GH at 24hr)

View Screen Capture[/u
[/quote]

[seleme]

Willy bot working hard to rise up the bitcoin price, and trying to adapt us to the new level price,
but this will be short term, and after that coming final fall and bitcoin the end.
Bistamp or or any other exchange will be shutdown.
(mining factor will be below 1 cents per GH at 24hr)

View Screen Capture[/u

[/quote]

and you're still be idiot, your usual self

[Bitcoin_is_here_to_stay]

Everything but the blue line is pretty bullish (except for a bit of swinging around). Everything that comes after this channel requires a level of predictive power I personally can't find motivation for right now.

Your pink line, crashes right through the trend line which was tested last week around $440, met at the $340 bottom, met again in the Oct Silk Road Crash, and trended along in Jan 2013.

If your pink line comes to pass, I would need to look at only shorting Bitcoin as a long term uptrend would be confirmed as finished, which would of course mean that we would be in a downtrend.

Not by my analysis. I have argued strenuously in here that I see strong evidence of (natural) buying support in the mid 400s. You're free to reject that conclusion obviously, but by my interpretation, pink line would just be 'ever so weakly upwards leaning consolidation'.

Basically, broken trendline doesn't mean much to me if there's a stronger factor in the back of my mind. Short term, it would be bearish, sure: we'd go below the 23% fib 1200-340, which means you'll hear the bulls cry again. Could be however that breaking through it without closing under it is the confirmation we need that we're out of the larger downtrend for good.

EDIT: and that particular trendline, the one that goes through the SR crash, is not a favorite of mine anyway. SR is a borderline outlier, so I weigh it less to begin with, it's far far in the past, with zero point between then and now even getting close to it, and it's angle is way too steep to really be a realistic line of support. the trendline that formed the triangle I looked at (until we broke out 9 days ago) was simply the slightly rising support through ~400.

Oda, do you think your violet scenario - retrace to ~540 - is occurring right now?

[zimmah]

Willy bot working hard to rise up the bitcoin price, and trying to adapt us to the new level price,
but this will be short term, and after that coming final fall and bitcoin the end.
Bistamp or or any other exchange will be shutdown.
(mining factor will be below 1 cents per GH at 24hr)

View Screen Capture[/u

and you're still be idiot, your usual self

-200 by march 2015. I think i'll wait with buying bitcoin, by march i can get a bitcoin for free and get $200 with it.

[Broseph Stalin]

My sloppily drawn chart. Two more legs to go?

[Bitcoin_is_here_to_stay]

My sloppily drawn chart. Two more legs to go?

Looks interesting, although price scale on the right is missing

[oda.krell]

Everything but the blue line is pretty bullish (except for a bit of swinging around). Everything that comes after this channel requires a level of predictive power I personally can't find motivation for right now.

Your pink line, crashes right through the trend line which was tested last week around $440, met at the $340 bottom, met again in the Oct Silk Road Crash, and trended along in Jan 2013.

If your pink line comes to pass, I would need to look at only shorting Bitcoin as a long term uptrend would be confirmed as finished, which would of course mean that we would be in a downtrend.

Not by my analysis. I have argued strenuously in here that I see strong evidence of (natural) buying support in the mid 400s. You're free to reject that conclusion obviously, but by my interpretation, pink line would just be 'ever so weakly upwards leaning consolidation'.

Basically, broken trendline doesn't mean much to me if there's a stronger factor in the back of my mind. Short term, it would be bearish, sure: we'd go below the 23% fib 1200-340, which means you'll hear the bulls cry again. Could be however that breaking through it without closing under it is the confirmation we need that we're out of the larger downtrend for good.

EDIT: and that particular trendline, the one that goes through the SR crash, is not a favorite of mine anyway. SR is a borderline outlier, so I weigh it less to begin with, it's far far in the past, with zero point between then and now even getting close to it, and it's angle is way too steep to really be a realistic line of support. the trendline that formed the triangle I looked at (until we broke out 9 days ago) was simply the slightly rising support through ~400.

Oda, do you think your violet scenario - retrace to ~540 - is occurring right now?

That channel was invalidated some days ago, and the lines I drew in hardly deserve the word 'scenario'... I wouldn't try to derive a price target from them (which I said in my post).

That said, I do see some evidence that we're seeing the first major retracement of this rally. For example, daily close below 1d SMA200, and what arguably looks like a shooting star pattern forming...








So, yes, unless buying pressure suddenly returns and turns this around, I expect a further retrace, to $590 perhaps, ~$530 if it gets nasty.

To be clear, I don't see any signs that our rally is over for good, so if you only care about the really large swings, or the really long stagnation periods, there's little need to act yet in my opinion.

[windjc]

Everything but the blue line is pretty bullish (except for a bit of swinging around). Everything that comes after this channel requires a level of predictive power I personally can't find motivation for right now.

Your pink line, crashes right through the trend line which was tested last week around $440, met at the $340 bottom, met again in the Oct Silk Road Crash, and trended along in Jan 2013.

If your pink line comes to pass, I would need to look at only shorting Bitcoin as a long term uptrend would be confirmed as finished, which would of course mean that we would be in a downtrend.

Not by my analysis. I have argued strenuously in here that I see strong evidence of (natural) buying support in the mid 400s. You're free to reject that conclusion obviously, but by my interpretation, pink line would just be 'ever so weakly upwards leaning consolidation'.

Basically, broken trendline doesn't mean much to me if there's a stronger factor in the back of my mind. Short term, it would be bearish, sure: we'd go below the 23% fib 1200-340, which means you'll hear the bulls cry again. Could be however that breaking through it without closing under it is the confirmation we need that we're out of the larger downtrend for good.

EDIT: and that particular trendline, the one that goes through the SR crash, is not a favorite of mine anyway. SR is a borderline outlier, so I weigh it less to begin with, it's far far in the past, with zero point between then and now even getting close to it, and it's angle is way too steep to really be a realistic line of support. the trendline that formed the triangle I looked at (until we broke out 9 days ago) was simply the slightly rising support through ~400.

Oda, do you think your violet scenario - retrace to ~540 - is occurring right now?

That channel was invalidated some days ago, and the lines I drew in hardly deserve the word 'scenario'... I wouldn't try to derive a price target from them (which I said in my post).

That said, I do see some evidence that we're seeing the first major retracement of this rally. For example, daily close below 1d SMA200, and what arguably looks like a shooting star pattern forming...








So, yes, unless buying pressure suddenly returns and turns this around, I expect a further retrace, to $590 perhaps, ~$530 if it gets nasty.

To be clear, I don't see any signs that our rally is over for good, so if you only care about the really large swings, or the really long stagnation periods, there's little need to act yet in my opinion.

Well, I'm not sure if we need a lot of buying pressure. If sellers don't keep selling, is there any way to go but up?

If we don't close the day below 621 then that example is invalidated anyway.

Im not convinced we see lower. Maybe.

[oda.krell]

[...]

Well, I'm not sure if we need a lot of buying pressure. If sellers don't keep selling, is there any way to go but up?

If we don't close the day below 621 then that example is invalidated anyway.

Im not convinced we see lower. Maybe.

I'm not convinced either. Just pointing out two, comparably bearish, short term developments.

Anyway, confirmation or rejection should be there within today or tomorrow. Best case for the bulls, today goes back up to touch daily BB upper band, and I'd say from tomorrow onwards the rally is back on. On the other hand, very weak red or green candle today, but no major move, means we have to wait more.

re: "close the day below 621". I don't look at the shooting star pattern that way, by those precise rules some like to give... It's simply an "inverted hammer" to me, which is why I at least consider that it marks a (temporary) peak.

[sgbett]

not to mention candlesticks need a market open/close to even exist. you can make them by picking some arbitrary time as your cutoff, but depending on which time you pick, you get different patterns.

[RyNinDaCleM]

not to mention candlesticks need a market open/close to even exist. you can make them by picking some arbitrary time as your cutoff, but depending on which time you pick, you get different patterns.

This is true, however the consensus is that 23:59.59 UTC is the close and 00:00 UTC is the open (the same as Bitcoincharts.com)

[MatTheCat]

not to mention candlesticks need a market open/close to even exist. you can make them by picking some arbitrary time as your cutoff, but depending on which time you pick, you get different patterns.

Doesn't matter.

A 1 day or 4 hour candlestick or candlestick pattern still gives plenty clues about market psychology over that time period.

The 1 day shooting start between $618 and $680, I could smell coming, as the market got thinner and thinner yet continued to rise up and up. The switch in market psychology is obvious. We now had a load of leveraged trades that were growing very very fat but all waiting to come out probably around the area of last significant resistance in $700 zone, but who are now either out of their trades in a panic, or waiting on the market to come back up as much as possible before exiting their trades. It will be a seller driven market until the leveraged longs have taken their profits and we have consolidated, I suspect somewhere in mid $500s a base will be found from which the grounds will be fertile for another whale driven ramp.

[zimmah]

not to mention candlesticks need a market open/close to even exist. you can make them by picking some arbitrary time as your cutoff, but depending on which time you pick, you get different patterns.

Doesn't matter.

A 1 day or 4 hour candlestick or candlestick pattern still gives plenty clues about market psychology over that time period.

I agree, it doesn't really matter if there's an open and close or not. Charts can still be made and are still relevant.

Not a single chart or tool can perfectly predict the future, but some can give a very good indication. And whether or not a market closes does not matter for charts

[oda.krell]

not to mention candlesticks need a market open/close to even exist. you can make them by picking some arbitrary time as your cutoff, but depending on which time you pick, you get different patterns.

Others said it already: you have a point in that the exact partitioning of the price data (which is what candles are) is arbitrary (though well defined ahead of time, so you cannot just "pick" the ideal boundaries you like best... however, you can pick another time scale, which can hide or show patterns that don't exist on another time scale), but it turns out that, on average, quite a few usable patterns emerge even after that arbitrary choice. Thomas Bulkowski's "Pattern Site" is probably the closest we have (or at least: that I know of) to provide some empirical foundation for TA as she is practiced, so with the caveat that this is not peer reviewed quality stuff, I'd cite him as evidence that (candle based) patterns tend to work -- don't know if he has data for shooting star though...

[Broseph Stalin]

My sloppily drawn chart. Two more legs to go?

It would seem like I was correct in my analysis. Sorry for not including the price to the right, but the C at the end was $620.. which we passed a bit down to $613 I think, but whatever. Close enough.

This would now put us in the fourth wave of this rally. The question is; how high will we go? Unless these two remaining waves are steeper than the previous ones, I don't see us hitting a new ATH. Maybe $850-900.

If they are steeper though.. all bets are off.

[sgbett]

I accept it's midnight utc to *draw* the chart but what I'm getting at is that midnight utc doesn't actually have the same effect on trading that an actual market open/close might have.

I can see you are all very keen for that to not matter though. I'm a chart noob anyway, I probably haven't got a clue what I'm talking about. Probably best to ignore everything I say

[sgbett]

Just to further discredit myself I would add that I would put the moon phase indicator as a much more reliable indicator than candlesticks. No homo. Or whatever it is you crazy kids say when you aren't joking.

[Gingermod]

Just to further discredit myself I would add that I would put the moon phase indicator as a much more reliable indicator than candlesticks. No homo. Or whatever it is you crazy kids say when you aren't joking.

Stop posting

[zimmah]

pretty interesting how the price seems to bounce around the first fib line (which dates back several weeks) then, after a drop recovers to find a new fib line that is climbing even faster, then it overshoots both lines just before both lines meet, and after a correction it seems to try to follow the old line again.

Pretty curious behavior if you ask me, not sure if it means anything but thought i'd just share.

by the way when you zoom in on the marked points, most of them have like 3 or 4 points of contact. Even at the last point it has 3 points of contact, which drew my attention because i didn't expect a line that old to actually be that significant even now.

[sgbett]

Stop posting

At least the other people that disagree had their big boy pants on.  What was your point again? You know this chart stuff is an art right? You know some people like Rembrandt and some people like Picasso? Tell me about your favourite indicator and why it's so good. Be sure not to say anything that everyone disagrees with though, the consequences could be unthinkable. You'll never be in the cool gang unless you say the right words.  So tell me to stop posting again. See if it works as well as the first time.

[thezerg]

Stop posting

At least the other people that disagree had their big boy pants on.  What was your point again? You know this chart stuff is an art right? You know some people like Rembrandt and some people like Picasso? Tell me about your favourite indicator and why it's so good. Be sure not to say anything that everyone disagrees with though, the consequences could be unthinkable. You'll never be in the cool gang unless you say the right words.  So tell me to stop posting again. See if it works as well as the first time.

You're right.  Someplace in the pacific would be better.  I'd be interested to see if it matters?  Do the candlesticks change completely if centered around different TZs?  If yes a lot of math needs to be applied to integrate an average worldview.

[oda.krell]

Just to further discredit myself I would add that I would put the moon phase indicator as a much more reliable indicator than candlesticks. No homo. Or whatever it is you crazy kids say when you aren't joking.

I get the impression you're half-serious, half-trolling... but your comments are always fun to read, so I'm not taking offense. Anyway. I'll try to parse your earlier points in two ways, then give an answer:

Questioning TA's validity in general: no really satisfactory way to answer to that. True, it's not properly tested, and quite possibly untestable for now (no proper model yet of the human mind, and only incomplete models of the human mind in groups), but some of those who use TA produce results that are statistically unlikely. I'd put TA in the same class of "intuitionist" frameworks as chess opening theory or Go strategies: they work, but can't be formalized to the point where they become testable under academic standards.

Questioning in particular candle based patterns: arbitrarily defined (but fixed) opening and closing times are de facto not a problem if the patterns that result from them produce statistically relevant effects. Like I said above, Bulkowski's methodology is not beyond reproach, but I wouldn't dismiss it out of hand either. Candle based patterns seem to work, on average, so whatever detrimental effect the arbitrary choice of data partitioning has, it doesn't ruin candle's usefulness entirely.


That said: turns out, that was not a shooting star (under the stricter rules of the pattern). Under my own (laxer) interpretation of looking at the June 1 candle as an inverted hammer, it starts to look like it didn't really mark a significant top (though we have to break 684 yet)

[sgbett]

I'm always at least half joking, I'm afraid its a condition I've developed whereby I find it best not to take anything too seriously, least of all myself! (and magnified on the internet)

I do accept there are patterns, I certainly couldn't say with any conviction there aren't. I've become more open minded to TA as practised by people like yourself, who do seem to understand how nuanced it is - an art form. As opposed to those that think its science, and seemingly refuse to accept that any given interpretation could be entirely wrong.

I think on a broader scale all patterns represent depictions of crowd psychology, and to this end their certainly is probably some information in them. That's why as outlandish as it sounds I think the moon indicator belongs in their. Human psychology and full moons seem to have some relationship, even if its along the same lines as people believe in chart patterns therefor they come true line of reasoning.

My reasoning behind the candlestick patterns being less relevant was due to that psychological effect of market open/close and how the intraday price in relation to the open/close price seemed to form some of the reasoning for certain candlestick patterns being described as they are.

I think the dailies (and weekly etc) are a different kind of beast to the intraday, 5 min, 10 min etc candles. Whilst, as you say, they both likely contain statistically relevant information, I suspect the kind of information they provide or the behaviour from which the two groups arise is likely different. Human psychology from one minute to the next is more a continuum, whereas the overall behaviour in a defined period with deadlines would be more discrete, and the time during which the market is closed provides quite a long period for significant changes to occur - a fairly simple example of this is the gap up/down one sees typically following some development out of hours. As BTC doesn't have out of hours we often get much smoother (although steep) moves on significant news, and these moves sometimes echo as other markets around the world enter their peak hours. In some way it may be that the always open nature of the bitcoin market somewhat dampens the volatility. In markets which gap up or down, they have to open somewhere and I think that initial jump may be much bigger due to people wanting to ensure they get in on the action (something like how an auction with sealed bids produces different results to one without). Again all of this is just me pondering the possible effects, not stating they are fact.

I suppose if I had to sum up what I am thinking, if one can intuit the difference in a regular market between the intra and inter day candles and what they show, then I would be more likely to treat all bitcoin candles regardless of period as 'intra' style. Given the market is continuos.

As I said before, I don't know really anything about it in practice and I'm just thinking out loud about the theory. Maybe it might be useful to someone, even if its only a starting point for a much deeper investigation.

(and definitely no offence intended)

[zimmah]

pretty interesting how the price seems to bounce around the first fib line (which dates back several weeks) then, after a drop recovers to find a new fib line that is climbing even faster, then it overshoots both lines just before both lines meet, and after a correction it seems to try to follow the old line again.

Pretty curious behavior if you ask me, not sure if it means anything but thought i'd just share.

by the way when you zoom in on the marked points, most of them have like 3 or 4 points of contact. Even at the last point it has 3 points of contact, which drew my attention because i didn't expect a line that old to actually be that significant even now.

happened again today, the top was exactly at the point where it hit the old line.

[Bitcoin_is_here_to_stay]

Nice to see this thread still alive, there is almost no TA left anywhere in this forum

Now we consolidating in 630-640 area on Stamp. Up or down from here?

The local bottom at ~$620 on Stamp was exactly the target of triple top formation, so we could try to go up from here. On the other hand, since $450 breakout, we went almost always up, without any substantial correction. Moreover, after at least 3 failed attempts to go above $680, even if we go North of $640, panic selling may begin even earlier this time? Yet on third hand  , some longs closed and new shorts opened on 'Finex. These shorts may be squeezed/scared by a move toward $680?

Thoughts?

[oda.krell]

We're getting closer to a decision point, I believe: Bollinger band width is near a point where the market usually starts moving again. The (hidden) bullish divergence on the 2h MFI (works on 6h as well) makes me lean towards upwards breakout, but daily MACD is about to go negative which means there's also reason to go down, short term.

Whatever way it moves at first though, I see a lot more potential to the upside than the downside currently: slow momentum is there (3d MACD positive, 1w MACD about to go positive), we're just banging our head against the daily SMA200 ~= 38% fib of entire downtrend ~= $650 resistance for now.

One way I could see it resolve is a dip at first, down to around daily SMA20 (~$612), then gathering the momentum to break the $650 resistance on the rebound.

[JustAnotherSheep]

It's also possible we'll continue to consolidate here for another week or two. My longest triangle count ends at the 22nd.



There also seems to be hidden bearish div on 30m MACD, though at that timescale I'm not sure what significance it has, if any. Yet that, and price being so close to the support lines, does make me a bit wary. It could further be argued that the real triangle (red support line in chart above) was already broken down on the 9th, although I'm hesitant to go with that idea and would rather await confirmation of the short-term bear scenario by the breaking of lower supports.

As for daily MACD about to go negative, that could mean two things in my view. It could "bounce", as it did it November 2013 where, just as it was about to cross down, the market resolved to shoot up instead. But that was within the bubble, and a fairer comparison could be September 2013 where it did cross down, which was followed by a month long consolidation period.

Also, the "magic" pre-bubble RSI level I noticed in my previous post has again seemingly been met (84.5), and now it's crossed down from being in overbought territory.

Though, looking at historic timescale on Stamp, I just noticed an interesting pattern: For every case of (daily) RSI being overbought outside of bubbles, the RSI top has been extremely consistent before price went down/consolidated: 83-85 (what do you even call that, RSI level?). Currently we're on 79, which according to this would give us some more room to go before the hypothesized correction (also assuming this is not the start of a bubble, which I doubt). Curious to see if this pattern holds again.

If that historic pattern continues to hold, it would support the longer consolidation/sideways movement scenario before the big rally can begin (which could be achieved by either a short-term price drop and formation of a much larger triangle pattern, a short spike (to $750-ish?) and the same, or just continuing within the longer triangle formation(s) at this level).

But then again lucif seems confident that it will (eventually?) go up from here, and I make it a habit to preemptively pack my bags when the clown prophet says we're going to the moon

[MatTheCat]

We're getting closer to a decision point, I believe: Bollinger band width is near a point where the market usually starts moving again. The (hidden) bullish divergence on the 2h MFI (works on 6h as well) makes me lean towards upwards breakout, but daily MACD is about to go negative which means there's also reason to go down, short term.

Whatever way it moves at first though, I see a lot more potential to the upside than the downside currently: slow momentum is there (3d MACD positive, 1w MACD about to go positive), we're just banging our head against the daily SMA200 ~= 38% fib of entire downtrend ~= $650 resistance for now.

One way I could see it resolve is a dip at first, down to around daily SMA20 (~$612), then gathering the momentum to break the $650 resistance on the rebound.

My thinking precisely!

Except the times in the past when we have actually agreed with each other, we have normally turned out to be wrong.

[cbeast]

So, what's urinalysis?

[sgbett]

My analysis (short to medium term) based on nothing but a gut feeling is the current rise is a tiny bit overextended, which is perfect for an engineered smack down designed to shake out a few loose coins to be snapped up cheap, before we resume a gentle uptrend.

Long term, I think this is it for super-exponential rises followed by blowoffs.

I think the 4-5 figure target is almost inevitable in the 2-5 year timeframe, but I think the route by which we get there is going to be very different to what people are used to and fraught with peril.

Forgive me for the lack of chart to back up my rambling

[Gingermod]

My analysis (short to medium term) based on nothing but a gut feeling is the current rise is a tiny bit overextended, which is perfect for an engineered smack down designed to shake out a few loose coins to be snapped up cheap, before we resume a gentle uptrend.

Long term, I think this is it for super-exponential rises followed by blowoffs.

I think the 4-5 figure target is almost inevitable in the 2-5 year timeframe, but I think the route by which we get there is going to be very different to what people are used to and fraught with peril.

Forgive me for the lack of chart to back up my rambling

Your rambling is unsubstantiated. There has yet to be a break in the overall trend line. We're going up:
https://www.tradingview.com/v/A1qSApSj/

Expect a couple weeks of this stability.

[sgbett]

If something hasn't broken it can never break?

I see.

[sgbett]

I have inspected your chart, that suggests history repeats itself...

[oda.krell]

My analysis (short to medium term) based on nothing but a gut feeling is the current rise is a tiny bit overextended, which is perfect for an engineered smack down designed to shake out a few loose coins to be snapped up cheap, before we resume a gentle uptrend.

Long term, I think this is it for super-exponential rises followed by blowoffs.

I think the 4-5 figure target is almost inevitable in the 2-5 year timeframe, but I think the route by which we get there is going to be very different to what people are used to and fraught with peril.

Forgive me for the lack of chart to back up my rambling

I have a hard time believing that. We agreed somewhere else that the patterns will probably become more difficult to recognize, but it's one of the very few bets I'd actually be willing to make: we will see another bubble cycle that differs from the previous ones only gradually (say, price increase by factor 5 instead of factor 10).

[sgbett]

I'll accept that premise *only* exponential rises from here on in

I think these rises will be much longer and drawn out, bit more like other markets. Mostly though, long term, up.

I just don't see how those really regular patterns go the last three highs can continue? Maybe thats what 'they' want people to think though. I sure won't complain if they do.

[JustAnotherSheep]

I have a hard time believing that. We agreed somewhere else that the patterns will probably become more difficult to recognize, but it's one of the very few bets I'd actually be willing to make: we will see another bubble cycle that differs from the previous ones only gradually (say, price increase by factor 5 instead of factor 10).

Summer 2012 would like to have a word with you

My own gut feeling tells me we're far from a "stable growth phase" yet, which can also be seen in these past few weeks/months of volatility on charts, which so far hasn't strayed from normal BTC behavior. If the anticipated "big investors" (wall street etc) are in fact beginning/going to buy in, I could definitely see bubble rises to at least $10k levels (though maybe not in the upcoming bubble, which imo (again based purely on gut feeling) is more likely to be like the 2012 one).

But as you say bett, this pattern can't hold forever. Unless we get a wonderfully drawn-out and bloody bear market somewhere in-between, taking us to fresh lows and giving the rocket some much-needed refuel time. Possibly coinciding with the more general upcoming markets crash luc and others keep going on about.

Maybe it's just wishful thinking though. Would be utterly shite for the rollercoaster-ride to end just as I was beginning to enjoy myself

[oda.krell]

I have a hard time believing that. We agreed somewhere else that the patterns will probably become more difficult to recognize, but it's one of the very few bets I'd actually be willing to make: we will see another bubble cycle that differs from the previous ones only gradually (say, price increase by factor 5 instead of factor 10).

Summer 2012 would like to have a word with you

My own gut feeling tells me we're far from a "stable growth phase" yet, which can also be seen in these past few weeks/months of volatility on charts, which so far hasn't strayed from normal BTC behavior. If the anticipated "big investors" (wall street etc) are in fact beginning/going to buy in, I could definitely see bubble rises to at least $10k levels (though maybe not in the upcoming bubble, which imo (again based purely on gut feeling) is more likely to be like the 2012 one).

But as you say bett, this pattern can't hold forever. Unless we get a wonderfully drawn-out and bloody bear market somewhere in-between, taking us to fresh lows and giving the rocket some much-needed refuel time. Possibly coinciding with the more general upcoming markets crash luc and others keep going on about.

Maybe it's just wishful thinking though. Would be utterly shite for the rollercoaster-ride to end just as I was beginning to enjoy myself

Maybe that was a misunderstanding then: My point was as well that I don't see us entering "stable growth" yet. Not for a few years, possibly.

I would however argue that volatility shows some signs of decreasing over time. By two relevant measures, rate of change and bollinger band width, used on a weekly or monthly time scale, the absolute peak is still the 2011 bubble cycle, and at least by bbw, the late 2013 cycle was slightly less volatile than the early 2013 one.

Not much to work with, admitted, but I can see the scenario where we have continued exponential run-ups to new ATHs, but each of them is slightly less violent than the previous one.

[JustAnotherSheep]

Maybe that was a misunderstanding then: My point was as well that I don't see us entering "stable growth" yet. Not for a few years, possibly.

I would however argue that volatility shows some signs of decreasing over time. By two relevant measures, rate of change and bollinger band width, used on a weekly or monthly time scale, the absolute peak is still the 2011 bubble cycle, and at least by bbw, the late 2013 cycle was slightly less volatile than the early 2013 one.

Not much to work with, admitted, but I can see the scenario where we have continued exponential run-ups to new ATHs, but each of them is slightly less violent than the previous one.

Ah, interesting and good points. Luckily, according to your chart, the decrease seems to be very slow, so it would indeed seem we, at the very least, have a few more bubble cycles to go.

Though an alternative scenario could be a fractal 3-bubble cycle, where (if 2012 is excluded) the last bubble was wave 3 of 5, and the next bubble will be akin to the 2011 one, breaking the pattern of decreasing volatility, which would also be a repeat of history as the two bubbles before the big one in 2011 saw slightly decreasing BBW and ROC peaks, just like the 2013 bubbles.

But again this is all just more wishful thinking I guess we'll have to wait and see if Bitcoin will defy expectations and explode in extreme volatile glory, or (more likely I guess) if it's slowly becoming stable and boring.

[birr]

My analysis (short to medium term) based on nothing but a gut feeling is the current rise is a tiny bit overextended, which is perfect for an engineered smack down designed to shake out a few loose coins to be snapped up cheap, before we resume a gentle uptrend.

Long term, I think this is it for super-exponential rises followed by blowoffs.

I think the 4-5 figure target is almost inevitable in the 2-5 year timeframe, but I think the route by which we get there is going to be very different to what people are used to and fraught with peril.

More or less the way I see it, too.

[CEG5952]

My analysis (short to medium term) based on nothing but a gut feeling is the current rise is a tiny bit overextended, which is perfect for an engineered smack down designed to shake out a few loose coins to be snapped up cheap, before we resume a gentle uptrend.

Long term, I think this is it for super-exponential rises followed by blowoffs.

I think the 4-5 figure target is almost inevitable in the 2-5 year timeframe, but I think the route by which we get there is going to be very different to what people are used to and fraught with peril.

Forgive me for the lack of chart to back up my rambling

Very much agree with this. I am not betting on the charts painting near replicas of the last bubbles, as many people are. 2-5 years is reasonable, and I think indeed that price action may pan out very differently than what many expect.

[sgbett]

If i did have to make a chart illustrate it, it might look like this...



Trend is up volatility slowly decreases over time 5k is only a few years out but the road there is strewn with doubt.

[CEG5952]

If i did have to make a chart illustrate it, it might look like this...



Trend is up volatility slowly decreases over time 5k is only a few years out but the road there is strewn with doubt.

But what will happen as price continues into this contracting range? Either way, it can't sustain forever, and a new trend must develop.

[sgbett]

If i did have to make a chart illustrate it, it might look like this...



Trend is up volatility slowly decreases over time 5k is only a few years out but the road there is strewn with doubt.

But what will happen as price continues into this contracting range? Either way, it can't sustain forever, and a new trend must develop.

I dunno but 2 years away is already far too long a timescale for 99% of people on this forum charts aren't my bag though, so absolutely don't make any decisions based on my hacked together pngs! This was just a visual that kind of shows what i thought might generally happen. id fully expect those lines to not actually be a meaningful price boundaries.

[MatTheCat]

I am calling it that this present rally has very little juice left in it. The following chart shows bearish divergences between the price action and the RSI and MACD, and also shows the Williams %R, which shows that Bitcoin has been hovering around in overbought zone and due a move down. This is all on 1hr chart which is about as close in as I like to base TA on. I am calling time on the rally and would suggest that potential sell points could range from right where are now ($610), up to the 62% Fib retracement target around $630, or the 76% retracement point at $645 at a push. I am not saying that Bitcoin is definitely going to find new lower lows than $538, but the weakness in buying pressure of this rally certainly gives cause for caution and suggests that the rally is of the corrective variety, or more likely, part of an emerging consolidation pattern.

[JustAnotherSheep]

Noticed the same div. Hourly MACD just crossed as well, so it seems less likely (at least to me) there will be a push to 630.

A similar sized bullish divergence on hourly occurred during the recent local bottom (between $550 and $537) resulting in this spike, so I think, judging from how far that pushed the price and how symmetrical it looks, this might mean a retest of long-term support (the 2013 line, currently at $555~ if I set it correct).

[MatTheCat]

Noticed the same div. Hourly MACD just crossed as well, so it seems less likely (at least to me) there will be a push to 630.

A similar sized bullish divergence on hourly occurred during the recent local bottom (between $550 and $537) resulting in this spike, so I think, judging from how far that pushed the price and how symmetrical it looks, this might mean a retest of long-term support (the 2013 line, currently at $555~ if I set it correct).

....yet three bars into negative hourly MACD territory and Bitcoin hasn't moved. Seems to be a lack of selling pressure for now and I wouldn't underestimate the power of Bitcoin to keep moving up against the grain of bearish chart indicators.

[Tzupy]

A small clarification: 1h MACD is still positive, just the divergence went negative.
MACD is a lagging indicator, the divergence is less lagging. This term confusion happens a lot in these forums.

[MatTheCat]

A small clarification: 1h MACD is still positive, just the divergence went negative.
MACD is a lagging indicator, the divergence is less lagging. This term confusion happens a lot in these forums.

Yeah...what I meant to say was negative crossover territory.

[Wary]

A small clarification: 1h MACD is still positive, just the divergence went negative.
MACD is a lagging indicator, the divergence is less lagging. This term confusion happens a lot in these forums.

 Possible way to explain it to someone with physics/math background:

TA               math                     physics

price            function                 coordinates
MACD           first derivative        speed
histogram      second derivative    acceleration

Edit: replaced "divergence" to "histogram", as more correct.

[Nicholas-Carraway]

I am calling it that this present rally has very little juice left in it. The following chart shows bearish divergences between the price action and the RSI and MACD, and also shows the Williams %R, which shows that Bitcoin has been hovering around in overbought zone and due a move down. This is all on 1hr chart which is about as close in as I like to base TA on. I am calling time on the rally and would suggest that potential sell points could range from right where are now ($610), up to the 62% Fib retracement target around $630, or the 76% retracement point at $645 at a push. I am not saying that Bitcoin is definitely going to find new lower lows than $538, but the weakness in buying pressure of this rally certainly gives cause for caution and suggests that the rally is of the corrective variety, or more likely, part of an emerging consolidation pattern.

I agree with this analysis.  Another reliable indicator to observe divergence is OBV.

Cheers,
Nick

[Tzupy]

A small clarification: 1h MACD is still positive, just the divergence went negative.
MACD is a lagging indicator, the divergence is less lagging. This term confusion happens a lot in these forums.

 Possible way to explain it to someone with physics/math background:

TA               math                     physics

price            function                 coordinates
MACD           first derivative        speed
divergence    second derivative    acceleration

Yes, good work.

[Tzupy]

Someone seems to be dumping on 4h MACD divergence... It was a reliable indicator in March, but the market has slowed down since.

I noticed something strange: the bid sum /ask sum ratio for BTCChina has been well below the price for the last 3 months.
The same ratio on Bitstamp has been 'normal', above price most of the time and only dropping when price dropped a lot.
So I have a conspiracy theory: arbitrage should have been easiest between Chinese exchanges, so I would expect the same
strange ratio to appear for Huobi and OKCoin (but I don't know if it is so, if you can get a graph for those it would be great).
However, if Huobi and OKCoin show a 'normal' ratio graph, my conspiracy theory is that they might show fake fiat to boost the bids.
By doing so, they would allow insiders to cash out at reasonably high prices, and after that they might show the true bids. 

[lebing]

Well, this thread has officially gone to shit. Where is Oda?

[oda.krell]

I've been playing around with an experimental indicator in here, but I wouldn't really suggest anyone yet to make any decisions based on the output. I know I don't take it too serious yet.

I lost interest in trading the swings a bit in the past weeks... "trading fatigue", is there such a thing? That's why I didn't post in here more often. For the record though, I enjoy all the other posts in here (justanothersheep makes a lot of good points imo, for example). Also, this is one of the few threads where traders/TAers don't have to defend themselves against the accusations coming from the "pure holder" mentality constantly.

I did take smaller profits twice during the swing down since May 31st/June 1st, but went long again afterwards. Both trades were pure momentum based, so nothing that warrants an analysis post.

So perhaps the following is not a really deep or interesting answer, but: I'm still long as a default position because I'm not really worried yet about the longer perspective upwards (say, looking forward a month from now).

That general positive outlook could change of course, but as long as we stay above what I think are key support lines at $560 (1w BB, 50% fib $440 to $680), and $535 (23% fib from $1160 to $340, 3d BB), I'm okay with the situation...

I think we are simply very cautiously moving ahead, in a "2 steps forward, 1 and 1/2 steps back" rhythm, if for no other reason than that the sentiment of the 2013/2014 bear market is still lingering, and because we are still waiting for that next "fiat floodgate" to open (an ETF, a new exchange associated with names from traditional finance, or even just a new national market that suddenly develops a taste). The USMS auction might play a role too, but I think its effects are overrated.

[MaxwellsDemon]

A small clarification: 1h MACD is still positive, just the divergence went negative.
MACD is a lagging indicator, the divergence is less lagging. This term confusion happens a lot in these forums.

 Possible way to explain it to someone with physics/math background:

TA               math                     physics

price            function                 coordinates
MACD           first derivative        speed
divergence    second derivative    acceleration

Thanks for that! It actually helps.
You should write a dictionary for TA-challenged scientists like me 

[cbeast]

A small clarification: 1h MACD is still positive, just the divergence went negative.
MACD is a lagging indicator, the divergence is less lagging. This term confusion happens a lot in these forums.

 Possible way to explain it to someone with physics/math background:

TA               math                     physics               Astrology

price            function                 coordinates         Birth Chart
MACD           first derivative        speed                 Star Chart
divergence    second derivative    acceleration         Planetary Motion

FTFY

[oda.krell]

http://link.springer.com/article/10.1007%2FBF02941226

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1006275

http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.19.4881

[zimmah]

A small clarification: 1h MACD is still positive, just the divergence went negative.
MACD is a lagging indicator, the divergence is less lagging. This term confusion happens a lot in these forums.

 Possible way to explain it to someone with physics/math background:

TA               math                     physics

price            function                 coordinates
MACD           first derivative        speed
divergence    second derivative    acceleration

Thanks for that! It actually helps.
You should write a dictionary for TA-challenged scientists like me  

i agree, as an engineer this makes perfect sense.

TA sometimes is easy, but some charts are very confusing.

[Wary]

To Tzupy, MaxwellsDemon, zimmah  -thanks for the appreciation. I wish I was good it TA, but I've just started learning it.
To cbeast  - special thanks. The sign of real popularity is people parodying you

[cbeast]

To Tzupy, MaxwellsDemon, zimmah  -thanks for the appreciation. I wish I was good it TA, but I've just started learning it.
To cbeast  - special thanks. The sign of real popularity is people parodying you

You made an analogy that TA is like math and physics. Math and physics make 100% accurate predictions. You imply that TA makes 100% accurate predictions. Please demonstrate your predictive science.

[Wary]

To Tzupy, MaxwellsDemon, zimmah  -thanks for the appreciation. I wish I was good it TA, but I've just started learning it.
To cbeast  - special thanks. The sign of real popularity is people parodying you

You made an analogy that TA is like math and physics. Math and physics make 100% accurate predictions. You imply that TA makes 100% accurate predictions. Please demonstrate your predictive science.

No such implications was made. The table is only about ways of processing raw data. The way we calculate MACD from price and histogram from MACD is similar to way we calculate speed from coordinates and acceleration from speed. The part of physics that deals with it is called kinematics and, being pure descriptional one, makes no predictions. To make a prediction we have to introduce idea of force. (Which would convert kinematics to dynamics. Dynamics does make predictions. To make TA a predictional science we have to introduce idea of "market forces". Which I didn't do, because it would be an analogy rather than science.

[oda.krell]

To Tzupy, MaxwellsDemon, zimmah  -thanks for the appreciation. I wish I was good it TA, but I've just started learning it.
To cbeast  - special thanks. The sign of real popularity is people parodying you

You made an analogy that TA is like math and physics. Math and physics make 100% accurate predictions. You imply that TA makes 100% accurate predictions. Please demonstrate your predictive science.

No such implications was made. The table is only about ways of processing raw data. The way we calculate MACD from price and histogram from MACD is similar to way we calculate speed from coordinates and acceleration from speed. The part of physics that deals with it is called kinematics and, being pure descriptional one, makes no predictions. To make a prediction we have to introduce idea of force. (Which would convert kinematics to dynamics. Dynamics does make predictions. To make TA a predictional science we have to introduce idea of "market forces". Which I didn't do, because it would be an analogy rather than science.

Hehehe. Nice.

One remark though: I like your table, but your original equivalence was: divergence - second derivative - acceleration. You sure about that one? I'm still trying myself to wrap my head around how to best conceptualize 'divergence' (in the TA sense), but I'm not sure if it's as straightforward as it being the second derivative.

In the paragraph above you seem to substitute 'histogram' for 'divergence', which I think is more accurate. 'Divergence' is, imo, at least another step removed from that.

[Wary]

To Tzupy, MaxwellsDemon, zimmah  -thanks for the appreciation. I wish I was good it TA, but I've just started learning it.
To cbeast  - special thanks. The sign of real popularity is people parodying you

You made an analogy that TA is like math and physics. Math and physics make 100% accurate predictions. You imply that TA makes 100% accurate predictions. Please demonstrate your predictive science.

No such implications was made. The table is only about ways of processing raw data. The way we calculate MACD from price and histogram from MACD is similar to way we calculate speed from coordinates and acceleration from speed. The part of physics that deals with it is called kinematics and, being pure descriptional one, makes no predictions. To make a prediction we have to introduce idea of force. (Which would convert kinematics to dynamics. Dynamics does make predictions. To make TA a predictional science we have to introduce idea of "market forces". Which I didn't do, because it would be an analogy rather than science.

Hehehe. Nice.

One remark though: I like your table, but your original equivalence was: divergence - second derivative - acceleration. You sure about that one? I'm still trying myself to wrap my head around how to best conceptualize 'divergence' (in the TA sense), but I'm not sure if it's as straightforward as it being the second derivative.

In the paragraph above you seem to substitute 'histogram' for 'divergence', which I think is more accurate. 'Divergence' is, imo, at least another step removed from that.

I had hope nobody would notice  Yes, I do think 'histogram' is more correct. I'll make correction in my original post, but the evidence of my stupidity would still remain in numerous quotes. Facepalm!  

[cbeast]

To Tzupy, MaxwellsDemon, zimmah  -thanks for the appreciation. I wish I was good it TA, but I've just started learning it.
To cbeast  - special thanks. The sign of real popularity is people parodying you

You made an analogy that TA is like math and physics. Math and physics make 100% accurate predictions. You imply that TA makes 100% accurate predictions. Please demonstrate your predictive science.

No such implications was made. The table is only about ways of processing raw data. The way we calculate MACD from price and histogram from MACD is similar to way we calculate speed from coordinates and acceleration from speed. The part of physics that deals with it is called kinematics and, being pure descriptional one, makes no predictions. To make a prediction we have to introduce idea of force. (Which would convert kinematics to dynamics. Dynamics does make predictions. To make TA a predictional science we have to introduce idea of "market forces". Which I didn't do, because it would be an analogy rather than science.

If you are describing objective data using science, then the data must be corroborated by multiple disciplines of science, else it is observational bias. And yes, in order to call it any science at all, you must be able to make some sorts of predictions. Otherwise, you have just another pseudoscience like astrology.

[Wary]

To Tzupy, MaxwellsDemon, zimmah  -thanks for the appreciation. I wish I was good it TA, but I've just started learning it.
To cbeast  - special thanks. The sign of real popularity is people parodying you

You made an analogy that TA is like math and physics. Math and physics make 100% accurate predictions. You imply that TA makes 100% accurate predictions. Please demonstrate your predictive science.

No such implications was made. The table is only about ways of processing raw data. The way we calculate MACD from price and histogram from MACD is similar to way we calculate speed from coordinates and acceleration from speed. The part of physics that deals with it is called kinematics and, being pure descriptional one, makes no predictions. To make a prediction we have to introduce idea of force. (Which would convert kinematics to dynamics. Dynamics does make predictions. To make TA a predictional science we have to introduce idea of "market forces". Which I didn't do, because it would be an analogy rather than science.

If you are describing objective data using science, then the data must be corroborated by multiple disciplines of science, else it is observational bias. And yes, in order to call it any science at all, you must be able to make some sorts of predictions. Otherwise, you have just another pseudoscience like astrology.

If you are saying that kinematics is a pseudoscience, like astrology, so be it. Who am I to argue with Hero member? 

[cbeast]

To Tzupy, MaxwellsDemon, zimmah  -thanks for the appreciation. I wish I was good it TA, but I've just started learning it.
To cbeast  - special thanks. The sign of real popularity is people parodying you

You made an analogy that TA is like math and physics. Math and physics make 100% accurate predictions. You imply that TA makes 100% accurate predictions. Please demonstrate your predictive science.

No such implications was made. The table is only about ways of processing raw data. The way we calculate MACD from price and histogram from MACD is similar to way we calculate speed from coordinates and acceleration from speed. The part of physics that deals with it is called kinematics and, being pure descriptional one, makes no predictions. To make a prediction we have to introduce idea of force. (Which would convert kinematics to dynamics. Dynamics does make predictions. To make TA a predictional science we have to introduce idea of "market forces". Which I didn't do, because it would be an analogy rather than science.

If you are describing objective data using science, then the data must be corroborated by multiple disciplines of science, else it is observational bias. And yes, in order to call it any science at all, you must be able to make some sorts of predictions. Otherwise, you have just another pseudoscience like astrology.

If you are saying that kinematics is a pseudoscience, like astrology, so be it. Who am I to argue with Hero member?  

I am saying that kinematics can be used to predict the future with certainty, but TA cannot. TA therefore is pseudoscience.

[MaxwellsDemon]

And yes, in order to call it any science at all, you must be able to make some sorts of predictions. Otherwise, you have just another pseudoscience like astrology.

You might want to leave Popper back in the 50's, where he belongs 

[Bitcoin_is_here_to_stay]

What about going back to more prosaic discussion of the current price movement? Where do you think is support and resistance? What chance the triangle will resolve up or down?

[oda.krell]

What about going back to more prosaic discussion of the current price movement? Where do you think is support and resistance? What chance the triangle will resolve up or down?

Not sure what you have in mind.

This one?




Daily RSI, Williams %R and MFI closed below 50, and don't seem to move for now. I can see us break out downwards, but I'd expect we find support at $533/$534 (3d BB, 23% fib $1160 to $340)

[MatTheCat]

Daily RSI, Williams %R and MFI closed below 50, and don't seem to move for now. I can see us break out downwards, but I'd expect we find support at $533/$534 (3d BB, 23% fib $1160 to $340)

As someone who is long Bitcoin, would it not concern you a bit that a break downwards, would mean breaking that trendline which dates back to Jan 2013, the very beginnings of the massive bull run that peaked in November 2013. When looking at charts through the lens of EW analysis, the breach of such a trendline would generally be seen as confirmation that the market was in a correction phase.

[windjc]

Daily RSI, Williams %R and MFI closed below 50, and don't seem to move for now. I can see us break out downwards, but I'd expect we find support at $533/$534 (3d BB, 23% fib $1160 to $340)

As someone who is long Bitcoin, would it not concern you a bit that a break downwards, would mean breaking that trendline which dates back to Jan 2013, the very beginnings of the massive bull run that peaked in November 2013. When looking at charts through the lens of EW analysis, the breach of such a trendline would generally be seen as confirmation that the market was in a correction phase.

No.

Why is breaking a long term trendline like that important? Trendlines are only important when they effect the mood of traders. If people are not going to sell their coins, as we saw in the low 400s, then trendlines will come and go until we go up again.

Since 2009 we are up and up.  You really think this is as high as it goes?

Its not going lower than what people are willing to sell for.

But it IS going up because there are still 6 billion+ people that don't know what it is.

[oda.krell]

Daily RSI, Williams %R and MFI closed below 50, and don't seem to move for now. I can see us break out downwards, but I'd expect we find support at $533/$534 (3d BB, 23% fib $1160 to $340)

As someone who is long Bitcoin, would it not concern you a bit that a break downwards, would mean breaking that trendline which dates back to Jan 2013, the very beginnings of the massive bull run that peaked in November 2013. When looking at charts through the lens of EW analysis, the breach of such a trendline would generally be seen as confirmation that the market was in a correction phase.

Said it before, but that particular trendline isn't really on my radar, if for no other reason that I never considered it sustainable in the first place. If we break out downwards, and we don't find support at 560, and we don't find support at ~530, then I'll have to reconsider my bullish outlook. Until then, I consider 'stretched out upwards consolidation' still more likely than 'mother of all bull traps'.

[Wary]

I am saying that kinematics can be used to predict the future with certainty, but TA cannot. TA therefore is pseudoscience.

Then you should use kinematics to predict future BTC prices. With certainty. But seriously, you've made 4 posts, but I still cannot understand which my statement, exactly, you are trying to refute?

[MatTheCat]

Said it before, but that particular trendline isn't really on my radar, if for no other reason that I never considered it sustainable in the first place. If we break out downwards, and we don't find support at 560, and we don't find support at ~530, then I'll have to reconsider my bullish outlook. Until then, I consider 'stretched out upwards consolidation' still more likely than 'mother of all bull traps'.

I suspect that you are right. I think the trendline will be breached, but it won't prove nearly as significant as many traders believe it will be. Try as I might, I just can't seem to rekindle the same bearish spirit that I had during the first part of 2014. Although, I would suggest that a correction right down to around $520 wouldn't be out of the question. $520 is the 61.8% Fib retracement from $420. The sort of retracement level where large money becomes very interesting in taking positions.

[Bitcoin_is_here_to_stay]

What about going back to more prosaic discussion of the current price movement? Where do you think is support and resistance? What chance the triangle will resolve up or down?

Not sure what you have in mind.

This one?




Daily RSI, Williams %R and MFI closed below 50, and don't seem to move for now. I can see us break out downwards, but I'd expect we find support at $533/$534 (3d BB, 23% fib $1160 to $340)

I was thinking of even smaller triangle, restricted from the top at $600-$613 and at the bottom by a rising support that stopped the falls at $540 and later $550. I use to be pretty sure we will break up out of it, but now I am more and more concerned that almost everybody turned bullish - even DanV is near term bullish . So who is going to buy btc on the way up when everybody seem long already, even leveraged long (I am referring to record high Bitfinex USD swaps and raising rates). Looks like even couple weeks or 2 months of flat price action can force some of these leveraged longs to liquidate ... It is more meta-TA than TA, but still concerning.

[Bitcoin_is_here_to_stay]

Daily RSI, Williams %R and MFI closed below 50, and don't seem to move for now. I can see us break out downwards, but I'd expect we find support at $533/$534 (3d BB, 23% fib $1160 to $340)

As someone who is long Bitcoin, would it not concern you a bit that a break downwards, would mean breaking that trendline which dates back to Jan 2013, the very beginnings of the massive bull run that peaked in November 2013. When looking at charts through the lens of EW analysis, the breach of such a trendline would generally be seen as confirmation that the market was in a correction phase.

Said it before, but that particular trendline isn't really on my radar, if for no other reason that I never considered it sustainable in the first place. If we break out downwards, and we don't find support at 560, and we don't find support at ~530, then I'll have to reconsider my bullish outlook. Until then, I consider 'stretched out upwards consolidation' still more likely than 'mother of all bull traps'.

Yeah, I would also be very surprised if it turned out to be a bull trap - and agree that long term exponentially growing support has to be breached soon, we do not seem to be ready for such quickly raising prices. Perhaps than sentiment will turn more bearish, so I will be more comfortable buying

[MatTheCat]

I was thinking of even smaller triangle, restricted from the top at $600-$613 and at the bottom by a rising support that stopped the falls at $540 and later $550. I use to be pretty sure we will break up out of it, but now I am more and more concerned that almost everybody turned bullish - even DanV is near term bullish . So who is going to buy btc on the way up when everybody seem long already, even leveraged long (I am referring to record high Bitfinex USD swaps and raising rates). Looks like even couple weeks or 2 months of flat price action can force some of these leveraged longs to liquidate ... It is more meta-TA than TA, but still concerning.

Any of these leveraged longs that got into Bitcoin anywhere above $540-ish last month, and who are still holding their positions, will be already underwater due to the compound interest rates of around 0.2% per day, or worse. I would tend to believe that maxed out state of the USD swaps is more like some whale (or the exchange itself) buying out the USD swap rate supply in order to decrease the supply and raise the USD swap rate price, into which he can then lend?

I dunno. But I find it hard to believe that all of those maxxed out USD swaps are sitting in leveraged long trades with 0.2% per day interest, whilst this market grinds along for the past two weeks going knowhere fast, yet pointing increasingly down. Or if I am wrong and there is a heap of leveraged longs feeling the creeping strain of those extortionate interest rates, then perhaps there will be some serious downside fireworks to come.

[Wary]

So who is going to buy btc on the way up when everybody seem long already

If the auction bidders, after losing the auction, will stick to their decision to buy BTC... Super-optimistic scenario: If competition at the auction is 10:1, it would mean 180M$ of fresh money. If almost nobody sells after the auction, like in rally stage, 1$ of fresh money pushes BTC capitalisation to 20$. Which increases the price on 180M$*20*(600/13000000000)=$166, i.e. to $770. Then media attention, hype, ATH, 5K$.  

[cbeast]

I am saying that kinematics can be used to predict the future with certainty, but TA cannot. TA therefore is pseudoscience.

Then you should use kinematics to predict future BTC prices. With certainty. But seriously, you've made 4 posts, but I still cannot understand which my statement, exactly, you are trying to refute?

I didn't say you made a statement in my first post. My interpretation was that you were implying that TA is analogous to math and physics when clearly it is analogous to astrology. You then went on to state that you only meant to imply that TA is "descriptive" to markets analogously as kinematics is to physics. You really should have said that to begin with. However, it's still a bad analogy since kinematics is used to make predictions in astrophysics. TA on the other hand is only used to make historical observations and has no demonstrable predictive value.

My refutation is that you made a bad analogy and followed it up with another bad analogy. If however, you compared TA to say "Transactional Analysis" or some other school of psychology, you might have a better analogy. I'm not implying that it would be of lesser value, just less empirical.

[Wary]

I am saying that kinematics can be used to predict the future with certainty, but TA cannot. TA therefore is pseudoscience.

Then you should use kinematics to predict future BTC prices. With certainty. But seriously, you've made 4 posts, but I still cannot understand which my statement, exactly, you are trying to refute?

I didn't say you made a statement in my first post. My interpretation was that you were implying that TA is analogous to math and physics when clearly it is analogous to astrology. You then went on to state that you only meant to imply that TA is "descriptive" to markets analogously as kinematics is to physics. You really should have said that to begin with. However, it's still a bad analogy since kinematics is used to make predictions in astrophysics. TA on the other hand is only used to make historical observations and has no demonstrable predictive value.

My refutation is that you made a bad analogy and followed it up with another bad analogy. If however, you compared TA to say "Transactional Analysis" or some other school of psychology, you might have a better analogy. I'm not implying that it would be of lesser value, just less empirical.

I highlighted the parts of your text that are, IMO, are partly(brown) or completely(red) false. However, I wouldn't like to keep polluting this thread. If you really wish to discuss it further, it would be better to open a separate thread for it, although I cannot promise participation, because we, it seems, cannot agree on anything at all.   Thank you, no hard feelings.


EDIT: As an illustration of one of brown points: Astrophysics Astrophysics (from Greek astron, ἄστρoν "star", and physis, φύσις "nature") is the branch of astronomy that deals with the physics of the universe, especially with "the nature of the heavenly bodies, rather than their positions or motions in space

[cbeast]

I am saying that kinematics can be used to predict the future with certainty, but TA cannot. TA therefore is pseudoscience.

Then you should use kinematics to predict future BTC prices. With certainty. But seriously, you've made 4 posts, but I still cannot understand which my statement, exactly, you are trying to refute?

I didn't say you made a statement in my first post. My interpretation was that you were implying that TA is analogous to math and physics when clearly it is analogous to astrology. You then went on to state that you only meant to imply that TA is "descriptive" to markets analogously as kinematics is to physics. You really should have said that to begin with. However, it's still a bad analogy since kinematics is used to make predictions in astrophysics. TA on the other hand is only used to make historical observations and has no demonstrable predictive value.

My refutation is that you made a bad analogy and followed it up with another bad analogy. If however, you compared TA to say "Transactional Analysis" or some other school of psychology, you might have a better analogy. I'm not implying that it would be of lesser value, just less empirical.

I highlighted the parts of your text that are, IMO, are partly(brown) or completely(red) false. However, I wouldn't like to keep polluting this thread. If you really wish to discuss it further, it would be better to open a separate thread for it, although I cannot promise participation, because we, it seems, cannot agree on anything at all.   Thank you, no hard feelings.


EDIT: As an illustration of one of brown points: Astrophysics Astrophysics (from Greek astron, ἄστρoν "star", and physis, φύσις "nature") is the branch of astronomy that deals with the physics of the universe, especially with "the nature of the heavenly bodies, rather than their positions or motions in space

lol

[Bitcoin_is_here_to_stay]

So who is going to buy btc on the way up when everybody seem long already

If the auction bidders, after losing the auction, will stick to their decision to buy BTC... Super-optimistic scenario: If competition at the auction is 10:1, it would mean 180M$ of fresh money. If almost nobody sells after the auction, like in rally stage, 1$ of fresh money pushes BTC capitalisation to 20$. Which increases the price on 180M$*20*(600/13000000000)=$166, i.e. to $770. Then media attention, hype, ATH, 5K$.  

I do not believe that there is a chance SR btc will be sold above the market (unless market suddenly crashes after the bids were made). I also think many /most of the bidders will be opportunistic buyers: for likes of SecondMarket, Bitpay or Coinbase, it always makes sense to buy btc at considerable discount.

I do not understand why many people think that buying these btc from US government should be such "once in a lifetime" opportunity for institutional investors  . There are many other options for them to buy substantial amounts of btc perfectly legally and safely. The second condition likely excludes exchanges , but they can still buy from big miners, SecondMarket, early adopters, btc processors (e.g. Bitpay) etc

[Wary]

I do not believe that there is a chance SR btc will be sold above the market (unless market suddenly crashes after the bids were made).

I've no opinion about this.

I also think many /most of the bidders will be opportunistic buyers: for likes of SecondMarket, Bitpay or Coinbase, it always makes sense to buy btc at considerable discount.

If they are even moderately bullish, they would believe the current price is probably very good discount comparing with half-year from now. So if they won't be able to win on the auction, they would took the second-best option, i.e. buy for market prices.

I do not understand why many people think that buying these btc from US government should be such "once in a lifetime" opportunity for institutional investors  

Agree, that is not a big deal. But a lot of them are now hesitating - to buy or not to buy. The auction adds couple of small weights to the "buy" scale: a bit safer, a bit cheaper.

There are many other options for them to buy substantial amounts of btc perfectly legally and safely. The second condition likely excludes exchanges , but they can still buy from big miners, SecondMarket, early adopters, btc processors (e.g. Bitpay) etc

Agree. But a bitcoin, purchased off-exchange would affects prices in exactly the same way as a bitcoin, purchased on-exchange. It would just take a bit more time for the price change information to propagate.

EDIT: About the last point. The information would propagate quite fast if somebody is doing an arbitrage between on and off-exchange. If nobody does it now yet, somebody would be doing it pretty soon. I imagine, it would be quite a big business in China and other BTC-hostile countries.

EDIT2: To oda.krell  Sorry for hijacking your thread. 

[oda.krell]

So who is going to buy btc on the way up when everybody seem long already

If the auction bidders, after losing the auction, will stick to their decision to buy BTC... Super-optimistic scenario: If competition at the auction is 10:1, it would mean 180M$ of fresh money. If almost nobody sells after the auction, like in rally stage, 1$ of fresh money pushes BTC capitalisation to 20$. Which increases the price on 180M$*20*(600/13000000000)=$166, i.e. to $770. Then media attention, hype, ATH, 5K$.  :)

I do not believe that there is a chance SR btc will be sold above the market (unless market suddenly crashes after the bids were made). I also think many /most of the bidders will be opportunistic buyers: for likes of SecondMarket, Bitpay or Coinbase, it always makes sense to buy btc at considerable discount.

I do not understand why many people think that buying these btc from US government should be such "once in a lifetime" opportunity for institutional investors  ???. There are many other options for them to buy substantial amounts of btc perfectly legally and safely. The second condition likely excludes exchanges ;), but they can still buy from big miners, SecondMarket, early adopters, btc processors (e.g. Bitpay) etc

Me neither. Or at least not significantly above. But neither will they be sold significantly below in all likelihood.

I'm afraid that whole thing will fizzle out without much effect. We probably won't get to know the price per lot immediately anyway (if ever), and will continue to drag on, eventually forgetting about the whole thing.


@wary: Nevermind the hijack :) But I'm afraid a discussion with cbeast about the validity of TA is pointless. I threw out a few links (on the previous page) to academic studies about TA, all three of them peer reviewed (as far as I can tell, it's not my own field, so I don't know the journals well enough), but he seems rather biased, ignoring evidence to the contrary and instead harps on about tangential points.

In any case, there's no point arguing with someone who _opens_ the discussion with "hur dur it's basically astrology"... imagine someone comes into this forum stating "Bitcoin's a ponzie!". (well, happens often enough). The assumption is, predictably, that he's trolling, and not seriously interested in engaging in a discussion.

Same thing here: the validity of TA is up for debate. But the starting positions need to be at least compatible enough to _have_ a discussion, and not just a troll fest.

[windjc]

So who is going to buy btc on the way up when everybody seem long already

If the auction bidders, after losing the auction, will stick to their decision to buy BTC... Super-optimistic scenario: If competition at the auction is 10:1, it would mean 180M$ of fresh money. If almost nobody sells after the auction, like in rally stage, 1$ of fresh money pushes BTC capitalisation to 20$. Which increases the price on 180M$*20*(600/13000000000)=$166, i.e. to $770. Then media attention, hype, ATH, 5K$.  

I do not believe that there is a chance SR btc will be sold above the market (unless market suddenly crashes after the bids were made). I also think many /most of the bidders will be opportunistic buyers: for likes of SecondMarket, Bitpay or Coinbase, it always makes sense to buy btc at considerable discount.

I do not understand why many people think that buying these btc from US government should be such "once in a lifetime" opportunity for institutional investors  . There are many other options for them to buy substantial amounts of btc perfectly legally and safely. The second condition likely excludes exchanges , but they can still buy from big miners, SecondMarket, early adopters, btc processors (e.g. Bitpay) etc

Me neither. Or at least not significantly above. But neither will they be sold significantly below in all likelihood.

I'm afraid that whole thing will fizzle out without much effect. We probably won't get to know the price per lot immediately anyway (if ever), and will continue to drag on, eventually forgetting about the whole thing.


@wary: Nevermind the hijack But I'm afraid a discussion with cbeast about the validity of TA is pointless. I threw out a few links (on the previous page) to academic studies about TA, all three of them peer reviewed (as far as I can tell, it's not my own field, so I don't know the journals well enough), but he seems rather biased, ignoring evidence to the contrary and instead harps on about tangential points.

In any case, there's no point arguing with someone who _opens_ the discussion with "hur dur it's basically astrology"... imagine someone comes into this forum stating "Bitcoin's a ponzie!". (well, happens often enough). The assumption is, predictably, that he's trolling, and not seriously interested in engaging in a discussion.

Same thing here: the validity of TA is up for debate. But the starting positions need to be at least compatible enough to _have_ a discussion, and not just a troll fest.

This idea that these bitcoins are going to go for a discount is ludicrious, imo. This is a blind auction, meaning if ONE, just one, entity bids over the market rate they are going over market rate.

Now all the bidders know most of their competition, its going to make the bid prices go up.

Noone is dumping on exchanges. In fact, its hard for me to comprehend the ignorance/stupidity of anyone who thinks someone is going to buy cheap from the government, transfer that money to an exchange and then try to sell for a profit. That's beyond imagination. These are serious buyers and players, not people/groups looking to go through the hassle to make maybe $5 a bitcoin profit on an illiquid exchange, where they couldn't sell that many coins anyway. Im getting stupidier just writing about this nonsense.

The coins may not go for a big premium, but I wouldn't be surprised at 5%+ over exchange rate.

These players was transparency. They want to legitimize their purchase by buying from the government. Most large investors want SAFETY first.

And there will be competition.

And the market will probably go up, simply because of a release of tension as to the outcome. Probably wont be sustained.

Although, I wouldn't be surprised if the markets has a semi-crash first.

[Bagatell]

The coins may not go for a big premium, but I wouldn't be surprised at 5%+ over exchange rate.

I assume the bids will be for fixed amounts so the exchange rate is kind of moot, no?

[cbeast]

And yes, in order to call it any science at all, you must be able to make some sorts of predictions. Otherwise, you have just another pseudoscience like astrology.

You might want to leave Popper back in the 50's, where he belongs 

His paradigm is still beyond your grasp. 
I'm not against new hypotheses, but TA is simply pattern seeking behavior with no utility. I have my own Bitcoin pseudoscience I call "Rule of Thirds and Superstitious Numbers." It's just as useful as TA. I just don't take it seriously.

[MatTheCat]

I'm not against new hypotheses, but TA is simply pattern seeking behavior with no utility. I have my own Bitcoin pseudoscience I call "Rule of Thirds and Superstitious Numbers." It's just as useful as TA. I just don't take it seriously.

Larry Williams. In 1987, he wins the World Championship in futures trading putting to use TA indicators which he developed himself, to turn $10K to $ 1 million within the space of a year. Someone should have told him that he could have have saved himself the bother of developing his own indicators and just plunked for the 'Rule of Thirds and Superstitious Numbers' method, as it just as good.

[oda.krell]

His paradigm is still beyond your grasp. 
I'm not against new hypotheses, but TA is simply pattern seeking behavior with no utility. I have my own Bitcoin pseudoscience I call "Rule of Thirds and Superstitious Numbers." It's just as useful as TA. I just don't take it seriously.

Right. It's moments like this when I understand the point of self-moderated threads (I still intensely dislike them, though).

I'm still waiting for you to make a coherent point of why you consider TA a "pseudoscience". Is it because of the EMH, that the market is essentially a random walk? Or because "regular" TA, i.e. chart analysis and discretionary trading, is difficult to test (in which case fully automated systems that can be tested shouldn't fall under your dismissive definition, right?).

In any case, it's pretty clear to me you're not actually trying to engage in an (admittedly interesting) discussion about the validity of TA, but are rather interested in getting a rise out of other users. Which is kind of... boring. So unless I'm going to see a post from you on this topic with a minimal amount of effort put into it, I'll file this under trolling.

[Torque]

Noone is dumping on exchanges. In fact, its hard for me to comprehend the ignorance/stupidity of anyone who thinks someone is going to buy cheap from the government, transfer that money to an exchange and then try to sell for a profit. That's beyond imagination. These are serious buyers and players, not people/groups looking to go through the hassle to make maybe $5 a bitcoin profit on an illiquid exchange, where they couldn't sell that many coins anyway. Im getting stupidier just writing about this nonsense.

And the market will probably go up, simply because of a release of tension as to the outcome. Probably wont be sustained.

Although, I wouldn't be surprised if the markets has a semi-crash first.

Can we make your post a sticky in this sub forum?  Or maybe we need a bumper sticker or something.  Like you, every time I hear someone say that these buyers are going to immediately dump their coins on exchanges, I feel like I'm trapped in that movie "Idiocracy."

If the price goes down after the auction, it won't have anything to do with the buyers.  It will simply be troll whale traders just trying to use FUD to incite a panic in order to get cheaper coins.  Most likely a huge bear trap before the start of a run up.

Also, since the last 2 pages this thread has become a pointless bear circle-jerk.

[oda.krell]

Can we make your post a sticky in this sub forum?  Or maybe we need a bumper sticker or something.  Like you, every time I hear someone say that these buyers are going to immediately dump their coins on exchanges, I feel like I'm trapped in that movie "Idiocracy."

Which simply means you don't understand how arbitrage works.

Also, since the last 2 pages this thread has become a pointless bear circle-jerk.

[Torque]

Can we make your post a sticky in this sub forum?  Or maybe we need a bumper sticker or something.  Like you, every time I hear someone say that these buyers are going to immediately dump their coins on exchanges, I feel like I'm trapped in that movie "Idiocracy."

Which simply means you don't understand how arbitrage works.

Which simply means you don't understand that HNW investors are not stupid troll day traders.  Have you even seen the list of auction buyers?  Point me to one on that list that would even care about arbitrage.  Just one.  Go on, I'll wait.

Or is it just more convenient to disregard common sense?

[oda.krell]

Can we make your post a sticky in this sub forum?  Or maybe we need a bumper sticker or something.  Like you, every time I hear someone say that these buyers are going to immediately dump their coins on exchanges, I feel like I'm trapped in that movie "Idiocracy."

Which simply means you don't understand how arbitrage works.

Which simply means you don't understand that HNW investors are not stupid troll day traders.

No, you're right of course. They clearly became HNW by being hodlors foreva ^__^ lol!!1!


In any case, believe what you want. I don't assume coins will be dumped after the auction either, but that's not the same as calling the idea that it might happen "idiotic".

[cbeast]

I'm not against new hypotheses, but TA is simply pattern seeking behavior with no utility. I have my own Bitcoin pseudoscience I call "Rule of Thirds and Superstitious Numbers." It's just as useful as TA. I just don't take it seriously.

Larry Williams. In 1987, he wins the World Championship in futures trading putting to use TA indicators which he developed himself, to turn $10K to $ 1 million within the space of a year. Someone should have told him that he could have have saved himself the bother of developing his own indicators and just plunked for the 'Rule of Thirds and Superstitious Numbers' method, as it just as good.

I think I saw his infomercial. Thanks, but I'll stick to HODL.

[Bitcoin_is_here_to_stay]

Can we make your post a sticky in this sub forum?  Or maybe we need a bumper sticker or something.  Like you, every time I hear someone say that these buyers are going to immediately dump their coins on exchanges, I feel like I'm trapped in that movie "Idiocracy."

Which simply means you don't understand how arbitrage works.

Also, since the last 2 pages this thread has become a pointless bear circle-jerk.

Yes, neither me or Oda said they are going immediately to dump. I have no opinion on that.

I just do not see why buying above the market would be such a great opportunity for the institutional investors - there are many other opportunities to do it legally in US for large batches of btc, as I pointed out in the previous post.

EDIT: And why is saying that SR coins are not likely to sell above market a "bear talk"? It is one of the many OTC transactions happening now, this one has chance to influence the market because price may be known publicly, but generally transaction of this size should be negligible and anyway the price will be close to the market in comparison with early adopters . Talking about Satoshi's likely ~ 1 million BTC stash acquired at close to 0 cost would be a true bear talk, LOL.

[lebing]

Thanks for the update Oda - and lol 

[windjc]

Can we make your post a sticky in this sub forum?  Or maybe we need a bumper sticker or something.  Like you, every time I hear someone say that these buyers are going to immediately dump their coins on exchanges, I feel like I'm trapped in that movie "Idiocracy."

Which simply means you don't understand how arbitrage works.

Which simply means you don't understand that HNW investors are not stupid troll day traders.

No, you're right of course. They clearly became HNW by being hodlors foreva ^__^ lol!!1!


In any case, believe what you want. I don't assume coins will be dumped after the auction either, but that's not the same as calling the idea that it might happen "idiotic".

Ummmm. It's pretty idiotic.

[windjc]

Can we make your post a sticky in this sub forum?  Or maybe we need a bumper sticker or something.  Like you, every time I hear someone say that these buyers are going to immediately dump their coins on exchanges, I feel like I'm trapped in that movie "Idiocracy."

Which simply means you don't understand how arbitrage works.

Also, since the last 2 pages this thread has become a pointless bear circle-jerk.

Yes, neither me or Oda said they are going immediately to dump. I have no opinion on that.

I just do not see why buying above the market would be such a great opportunity for the institutional investors - there are many other opportunities to do it legally in US for large batches of btc, as I pointed out in the previous post.

EDIT: And why is saying that SR coins are not likely to sell above market a "bear talk"? It is one of the many OTC transactions happening now, this one has chance to influence the market because price may be known publicly, but generally transaction of this size should be negligible and anyway the price will be close to the market in comparison with early adopters . Talking about Satoshi's likely ~ 1 million BTC stash acquired at close to 0 cost would be a true bear talk, LOL.

There's no advantage to buying above market. But it only takes 1 bid.

I'll be happy to take bets that we go above market.

[Bitcoin_is_here_to_stay]

Can we make your post a sticky in this sub forum?  Or maybe we need a bumper sticker or something.  Like you, every time I hear someone say that these buyers are going to immediately dump their coins on exchanges, I feel like I'm trapped in that movie "Idiocracy."

Which simply means you don't understand how arbitrage works.

Also, since the last 2 pages this thread has become a pointless bear circle-jerk.

Yes, neither me or Oda said they are going immediately to dump. I have no opinion on that.

I just do not see why buying above the market would be such a great opportunity for the institutional investors - there are many other opportunities to do it legally in US for large batches of btc, as I pointed out in the previous post.

EDIT: And why is saying that SR coins are not likely to sell above market a "bear talk"? It is one of the many OTC transactions happening now, this one has chance to influence the market because price may be known publicly, but generally transaction of this size should be negligible and anyway the price will be close to the market in comparison with early adopters . Talking about Satoshi's likely ~ 1 million BTC stash acquired at close to 0 cost would be a true bear talk, LOL.

There's no advantage to buying above market. But it only takes 1 bid.

I'll be happy to take bets that we go above market.

Ok, so we agree it does not make sense to overpay, you are just more pessimistic than me about the common sense of the bidders.

Do we know when the bids will be placed? I am not particularly interested in conditions of this auction so I have never researched it. If we would not have exact knowledge of the time bid was placed we may not even know if the bit was e.g. intentionally placed over market or end up that way, lol. Anyway, I am not interested in betting on it, either .

BTW, some people on this forum say they would gladly pay 110% or 120% themselves for reasons they do not clarify .

[Dragonkiller]

I think the coins will go for a small premium.

Say I want to buy 3000 coins, I can buy that much on the exchanges and only push the price up to ~600. So I would place a bid for slightly lower than that.

Now, if there is an entity that wants to buy all 30,000, they would push up the price much higher than ~600 if they try to buy them on the exchanges. So they will bid higher.

I think all (or at least most) of the coins will go to a single entity for a small premium.

[zimmah]

Noone is dumping on exchanges. In fact, its hard for me to comprehend the ignorance/stupidity of anyone who thinks someone is going to buy cheap from the government, transfer that money to an exchange and then try to sell for a profit. That's beyond imagination. These are serious buyers and players, not people/groups looking to go through the hassle to make maybe $5 a bitcoin profit on an illiquid exchange, where they couldn't sell that many coins anyway. Im getting stupidier just writing about this nonsense.

And the market will probably go up, simply because of a release of tension as to the outcome. Probably wont be sustained.

Although, I wouldn't be surprised if the markets has a semi-crash first.

Can we make your post a sticky in this sub forum?  Or maybe we need a bumper sticker or something.  Like you, every time I hear someone say that these buyers are going to immediately dump their coins on exchanges, I feel like I'm trapped in that movie "Idiocracy."

If the price goes down after the auction, it won't have anything to do with the buyers.  It will simply be troll whale traders just trying to use FUD to incite a panic in order to get cheaper coins.  Most likely a huge bear trap before the start of a run up.

Also, since the last 2 pages this thread has become a pointless bear circle-jerk.

Agreed, would be similar to people bidding on a confiscated yacht from a drug baron just for the sole purpose of instantly re-selling it for a nice markup.

Most people who by at an auction do not immediately resell, although they might intend to resell it later, when the value of the product improved (either by improving it yourself or by waiting for the market to appreciate the product more).

[MatTheCat]

There's no advantage to buying above market. But it only takes 1 bid.

I'll be happy to take bets that we go above market.

Right there is no advantage as any Whale entity looking to build up a Bitcoin position will have access to channels of miner BTC which will be sold in large quantities at a discounted rate to any given market spot price. But should just one bidder take leave of their common sense and bid above spot price, then the BTC will indeed go for a premium.

The other argument against these coins going for a premium is that the Bitcoin market would be so easy for any entity with deep pockets to boss around like a bitch. They could use their market clout to create negative trading signals and push price down and keep it held down as they soak up batch upon batch of 'cheap(er)' Bitcoin. Perhaps this has already been happening? Perhaps it will happen to some extent between now and the auction on Friday?

[windjc]

There's no advantage to buying above market. But it only takes 1 bid.

I'll be happy to take bets that we go above market.

Right there is no advantage as any Whale entity looking to build up a Bitcoin position will have access to channels of miner BTC which will be sold in large quantities at a discounted rate to any given market spot price. But should just one bidder take leave of their common sense and bid above spot price, then the BTC will indeed go for a premium.

The other argument against these coins going for a premium is that the Bitcoin market would be so easy for any entity with deep pockets to boss around like a bitch. They could use their market clout to create negative trading signals and push price down and keep it held down as they soak up batch upon batch of 'cheap(er)' Bitcoin. Perhaps this has already been happening? Perhaps it will happen to some extent between now and the auction on Friday?

You don't know this. Show proof.

And...do you want to bet on it?

[MatTheCat]

You don't know this. Show proof.

And...do you want to bet on it?

I don't know this and I have no proof....

.....but I have seen miners going on UK LocalBitcoins selling BTC at around 5% below Bitstamp, but with the minimum trade size being 10K GBP.

[Wary]

In normal countries that's exactly what would happen. The confiscated goods sold to right people, for half price, and dumped to market immediately. The wrong bidders won't take part in the auction because they failed to fill application forms correctly or something like this. But US is not quite normal country (yet  ), so I don't really know.

[windjc]

You don't know this. Show proof.

And...do you want to bet on it?

I don't know this and I have no proof....

.....but I have seen miners going on UK LocalBitcoins selling BTC at around 5% below Bitstamp, but with the minimum trade size being 10K GBP.

Good grief. 95% of all bitcoins sell for a premium on LocalBitcoins.

This is as good as you got?

[MatTheCat]

Good grief. 95% of all bitcoins sell for a premium on LocalBitcoins.

This is as good as you got?

Indeed they do. Which is why it was all the more telling that this chap (with a lot of Bitcoins to sell) was selling these coins at a rebate (the opposite of a premium) for those with deep enough pockets to stump a minimum of 10K. The '5%' thing is a number I am just putting in cos I don't remember the exact amount. I do remember kicking myself that all my liquidity was on Stamp and that I wasn't in a position to take advantage of it.....I could have just flipped them right away in lower quantities on LocalBitcoins itself for a tidy profit.

[Bitcoin_is_here_to_stay]

Good grief. 95% of all bitcoins sell for a premium on LocalBitcoins.

This is as good as you got?

Indeed they do. Which is why it was all the more telling that this chap (with a lot of Bitcoins to sell) was selling these coins at a rebate (the opposite of a premium) for those with deep enough pockets to stump a minimum of 10K. The '5%' thing is a number I am just putting in cos I don't remember the exact amount. I do remember kicking myself that all my liquidity was on Stamp and that I wasn't in a position to take advantage of it.....I could have just flipped them right away in lower quantities on LocalBitcoins itself for a tidy profit.

Or perhaps he was a scammer?

[lebing]

In normal countries that's exactly what would happen. The confiscated goods sold to right people, for half price, and dumped to market immediately. The wrong bidders won't take part in the auction because they failed to fill application forms correctly or something like this. But US is not quite normal country (yet  ), so I don't really know.

I guess if your "normal" is hilariously, overtly corrupt, then sure.

In America, we like to keep our corruption slightly more opaque.

[oda.krell]

Why I'm still long as a default position: fib levels and the uptrend so far


Okay, time for another "serious" TA post, after a bit of a break. I've been asked a few times if, and why, I'm still long currently, despite the recent price action and uncertainty about the near future.

I should mention that I did make a small number of trades during this swing (since the June 1 peak), but they were all purely momentum based, when it became very clear that a move down was picking up speed. However, perhaps the most important question for a swing trader is "what is your default position", i.e. whether you take profits in USD or BTC (in this market). For me, that default position is  BTC currently, and I'll explain why in a moment.

First, though, let me clearly say what I am NOT going to argue for: a meteoric rise in the near future. Here's what I wrote (a bit too angrily maybe) in another thread, where someone posted another one of those "$10,000 USD next year" predictions:

Stop with the TO DA MOON projection bullshit, bulls. That's my opinion.

My patience is starting to wear thin.

2014 is starting to look like 2011/2012: time for the network to grow, services to develop, the community to grow, etc. And price, to, well, stagnate a bit.

Don't think that's true? I don't give a fuck, we all make our bets accordingly (some sold, sold are holding, some are buying more), but whatever you decided to do, the desperate repetition of those "$10,000/$100,000 next month/year" threads is getting ridiculous.

If price really goes up that much, that fast, we will notice, I'm sure. Until then, work to improve the network in your own ways.

(And I realize that this is what Blitz has been saying for close to 6 months now. Good guy.)

Note please: I don't completely rule out another parabolic rally later this year, but I'm far from sure it'll happen. In fact, I'm slightly more inclined to think the next ATH rally will only happen next year at the earliest, and probably not to a "moon" number like $10k, but more likely a doubling or so of the previous ATH, which would still be extremely impressive.

But none of that matters right now. I'm simply trying to figure out if, right now, it makes sense to sell (to protect the USD value of your position), or whether the mid term direction is more likely to be up.

* * *

My analysis is based on the following two premises. You don't need to agree with them, but if you don't, you probably won't see much value in the argument I'm going to present.

1) $340 was, most likely, the capitulation bottom of the 2013/2014 bear market.

2) The period following the bear market, now, will be somewhat "reluctant" in moving up, with long periods of stagnation and possibly some serious setbacks.

I have argued previously why I believe 1) holds, won't repeat that now. I believe point 2) holds mainly for the following reasons: a) because the bear market was a lot more crushing than for example the short recovery period after the April 2013 ATH, b) because there were a few seriously disturbing news/developments that the market is still recovering from, mainly: mtgox, and uncertainty about China, and finally c) because no new "market explosion event" has taken place yet, that brings in an abundance of new fiat.

Examples of point c) are for example China entering the market big time in the 2nd half of 2013. What an event like that could look like now is, for example, the approval and listing of one of the ETFs, a new "serious" exchange backed by "old money" that brings in new types of investors, or a large enough country suddenly developing a taste for investing and/or using Bitcoin.

Those are the premises, on which my following technical arguments rest. In other words, I assume, from point 1), that we are in principle moving upwards, from point 2) that this is only going to proceed slowly.


Fib comparison #1

The longer historical comparison.

First graph shows the immediate recovery after the extremely crushing 2011 bear market. After the bottom of around $2, the first swing up ended at around $7. Then followed a retracement of that swing to 50%, where it stayed a long time, with and additional spike even deeper to the 62% fib level.





Next, the recovery after the July 2013 bottom at $63. Swing up to $100, followed by retracement to, you guessed it, 50%, and a spike to 62%. Now, to be clear: the recovery in mid 2013 was a lot smoother than what I expect to see now, but at least in terms of fib levels, we tested those two then as well.





Finally, our current view. The situation looks a lot different because of the intermediate period (after the assumed $340 bottom) in May, but from my perspective, what matters is how far we have progressed from that bottom. And as you can see, in today's situation we're not even near a 50%, let alone a 62% retracement. Which is why I'm not really worried yet.





Fib comparison #2

The next is pretty much a fractal view of the above. Let's compare the May consolidation period to the current one. After the $548 peak, most of May 2014 saw a period mostly of stagnation, that touched (surprise) 50% and 62% fib levels again.





Which is precisely where we are now again, in terms of fib levels.






The recovery so far

Here's another way to look at it. The following graph is a series of the intermediate highs and lows so far. Since the $340 bottom, we can see that a series of higher highs and higher lows is forming, in other words, an uptrend.





Marked in yellow is the range that could invalidate that picture. If price falls below the previous low of $538 on June 14, I won't automatically assume that we're back in a bear market, but it will be a sign for me to start questioning my default position. Should we hit, and break through, ~$530, what matters then is how price behaves afterwards wrt to the fib levels I've mentioned above. But that's another post, should it come to that.

[Dragonkiller]

You list 'market explosion' events such as an ETF being approved or a new 'serious' exchange popping up. We know these things will happen in the remainder of 2014, so why do you say a new ATH rally will not take place until at least next year?

[oda.krell]

You list 'market explosion' events such as an ETF being approved or a new 'serious' exchange popping up. We know these things will happen in the remainder of 2014, so why do you say a new ATH rally will not take place until at least next year?

I only know that more than one ETF has been under consideration for some time now. If and when it gets approved, we will see whether it does in fact lead to another 'explosion event' or not.

Keep in mind, there were almost 2 years between the 2011 ATH and the next one, so having to wait for a bit more than year to get to the next one (especially after seeing two in quick succession in 2013) isn't exactly a gloomy prediction.

[Dragonkiller]

You list 'market explosion' events such as an ETF being approved or a new 'serious' exchange popping up. We know these things will happen in the remainder of 2014, so why do you say a new ATH rally will not take place until at least next year?

I only know that more than one ETF has been under consideration for some time now. If and when it gets approved, we will see whether it does in fact lead to another 'explosion event' or not.

Keep in mind, there were almost 2 years between the 2011 ATH and the next one, so having to wait for a bit more than year to get to the next one (especially after seeing two in quick succession in 2013) isn't exactly a gloomy prediction.

Well we know Barry Silbert is hoping to launch his exchange this summer and his ETF in Q4.

The Winklevoss ETF will likely be approved this year too.

Yes, it isn't a gloomy prediction and in fact I agree with your prediction for the size of the next ATH. But I don't agree with the timing.

[windjc]

Excellent new post Oda. I agree on almost all points. I dont know if we will test50 and 62 fibs of bottom again, since we did it so long already after the first leg up. But i do expect that we will have another upward movement soon. I also agree on ATHs. They are not around the corner and they will always be of less magnitude than they were in the past.

[inca]

Excellent new post Oda. I agree on almost all points. I dont know if we will test50 and 62 fibs of bottom again, since we did it so long already after the first leg up. But i do expect that we will have another upward movement soon. I also agree on ATHs. They are not around the corner and they will always be of less magnitude than they were in the past.

I don't think trying to predict the timing of the next bubble is very useful. History rhymes etc.

[RyNinDaCleM]

Great observations, oda!

One thing I would like to point out. The Feb '12 bottom after the $7.22 high (the lower one) was caused by a trader who thought he would slam the market and make all this money. He even gloated about it on this forum with screen shot and all. Big mistake! Someone else quickly short squoze him in one of the fastest 100% swing volatility we have seen. This doesn't change that it happened, and it still stirred the psychology in the market, so by default, valid to use the data, but it was something that wouldn't have normally happened without the help of the #2 worst exchange (maybe #3?) Bitcoinica.

[oda.krell]

Great observations, oda!

One thing I would like to point out. The Feb '12 bottom after the $7.22 high (the lower one) was caused by a trader who thought he would slam the market and make all this money. He even gloated about it on this forum with screen shot and all. Big mistake! Someone else quickly short squoze him in one of the fastest 100% swing volatility we have seen. This doesn't change that it happened, and it still stirred the psychology in the market, so by default, valid to use the data, but it was something that wouldn't have normally happened without the help of the #2 worst exchange (maybe #3?) Bitcoinica.

Thanks! Really interesting to hear that bit about 2012.

I know the history 'first hand' since last year, and have done some reading into the 2011/2012 era, but it's different if you experienced it directly or not. The entire Bitcoinica debacle is something I only know of vaguely, and it almost feels a bit like "grandfather reminisces about the war" when I hear the 2010/2011 members talk about it... and it's aweseome, I hope I can do the same in 2016 for the new members "I will never forget the SR coins auction in June 2014, kids" :D

[lebing]

Thanks again Oda for the great analysis as usual. Bare with me for a minute while I poke the subject few analysts like to touch. I am wondering why everyone is so confident about the next run up being smaller in % than 2013. Imo the next run up starts when an ETF is released and all of that pent up non technical buying demand is finally provided with their preferred buying option. Once that starts I do not see this run up playing out any differently than the others. Something to consider as well is just how different the medias opinion is now vs 2013. We did not have a resident spokesperson bloomberg tv in 2013, that would have been unfathomable.  For these reasons I believe the market is still far too small of a market cap to absorb the pent up demand and corresponding usual frenzy without moving the price at least over 5k, probably 10k. This will happen within a few weeks of the etf release so I am also optimistic that it will happen this year.

[oda.krell]

Thanks again Oda for the great analysis as usual. Bare with me for a minute while I poke the subject few analysts like to touch. I am wondering why everyone is so confident about the next run up being smaller in % than 2013. Imo the next run up starts when an ETF is released and all of that pent up non technical buying demand is finally provided with their preferred buying option. Once that starts I do not see this run up playing out any differently than the others. Something to consider as well is just how different the medias opinion is now vs 2013. We did not have a resident spokesperson bloomberg tv in 2013, that would have been unfathomable.  For these reasons I believe the market is still far too small of a market cap to absorb the pent up demand and corresponding usual frenzy without moving the price at least over 5k, probably 10k. This will happen within a few weeks of the etf release so I am also optimistic that it will happen this year.

Thanks for the kind words. Keep in mind, my initial remarks (about how far the next "bubble" will go) are comparably off-handed. I don't have the tools to predict the long term price, and I don't trust the tools that I know to exist (log linear extrapolation), so what I believe I _can_ do is short and mid term predictions and calculations.

That said, the main reason that I do believe bubble size growth will decrease over time is that I believe that as the market gets bigger, the market also becomes more professional, which also entails it becomes more opportunistic, which entails profits will be taken earlier (because if you don't take profits comparably early, someone else will, and suddenly there are no profits for you to take anymore - i.e. a game theoretic understanding emerges that profits need to be taken earlier as time progresses), which entails the bubbles will overshoot less than they did in the past.

But I'm not firmly committed to this, or rather: I don't really base my trading decisions on this (relatively vague) intuition, which in a way means I don't trust my own intuition. It's just that I trust others' intuition about the 10k coin in 2015 even less.


Update: Watch out for $614 to $616. Daily SMA200 (which threw us back earlier this month) is sitting there right now, and it is the previous peak from mid June. Won't be trivial to break it, I'm afraid, but if we make it through it, we'll probably pick up speed.

[Bitcoin_is_here_to_stay]

Thanks again Oda for the great analysis as usual. Bare with me for a minute while I poke the subject few analysts like to touch. I am wondering why everyone is so confident about the next run up being smaller in % than 2013. Imo the next run up starts when an ETF is released and all of that pent up non technical buying demand is finally provided with their preferred buying option. Once that starts I do not see this run up playing out any differently than the others. Something to consider as well is just how different the medias opinion is now vs 2013. We did not have a resident spokesperson bloomberg tv in 2013, that would have been unfathomable.  For these reasons I believe the market is still far too small of a market cap to absorb the pent up demand and corresponding usual frenzy without moving the price at least over 5k, probably 10k. This will happen within a few weeks of the etf release so I am also optimistic that it will happen this year.

Thanks for the kind words. Keep in mind, my initial remarks (about how far the next "bubble" will go) are comparably off-handed. I don't have the tools to predict the long term price, and I don't trust the tools that I know to exist (log linear extrapolation), so what I believe I _can_ do is short and mid term predictions and calculations.

That said, the main reason that I do believe bubble size growth will decrease over time is that I believe that as the market gets bigger, the market also becomes more professional, which also entails it becomes more opportunistic, which entails profits will be taken earlier (because if you don't take profits comparably early, someone else will, and suddenly there are no profits for you to take anymore - i.e. a game theoretic understanding emerges that profits need to be taken earlier as time progresses), which entails the bubbles will overshoot less than they did in the past.

But I'm not firmly committed to this, or rather: I don't really base my trading decisions on this (relatively vague) intuition, which in a way means I don't trust my own intuition. It's just that I trust others' intuition about the 10k coin in 2015 even less.


Update: Watch out for $614 to $616. Daily SMA200 (which threw us back earlier this month) is sitting there right now, and it is the previous peak from mid June. Won't be trivial to break it, I'm afraid, but if we make it through it, we'll probably pick up speed.

Another very simple reason for much smaller bubbles is a sheer amount of money it would require. I mean, raising the current price X to 2X would require twice as much money as would be needed to raise price from 1/2X to X. This is of course very simplified, but you get the idea: e.g. price cannot raise "as easily" from $700 to $1400 as it did from $350 to $700.

[MatTheCat]

But I'm not firmly committed to this, or rather: I don't really base my trading decisions on this (relatively vague) intuition, which in a way means I don't trust my own intuition. It's just that I trust others' intuition about the 10k coin in 2015 even less.

Update: Watch out for $614 to $616. Daily SMA200 (which threw us back earlier this month) is sitting there right now, and it is the previous peak from mid June. Won't be trivial to break it, I'm afraid, but if we make it through it, we'll probably pick up speed.

Intution, ah that old chestnut.

The indicators and common sense all suggest that Bitcoin should correct a bit from here but my intuition says that that $615 target will be taken out and then some. B4 or after a correction I don't know, but I am finding it very difficult to get my heart behind the bearish cause at the moment.

As I type, all the rampy, leveragey, fake volumey exchanges are bursting and squeeling to go higher....but Stamp won't let them. If whales on all the other big exchanges think that Bitcoin is such a great buy at these prices, why aren't they buying on Stamp?

[CEG5952]

The indicators and common sense all suggest that Bitcoin should correct a bit from here but my intuition says that that $615 target will be taken out and then some. B4 or after a correction I don't know, but I am finding it very difficult to get my heart behind the bearish cause at the moment.

I'm bullish -- soon -- but this last leg looks like a fakeout. I think we might correct down from here before approaching that target. Still looking for 580 level, unless I see a breakout up first.

[MatTheCat]

The indicators and common sense all suggest that Bitcoin should correct a bit from here but my intuition says that that $615 target will be taken out and then some. B4 or after a correction I don't know, but I am finding it very difficult to get my heart behind the bearish cause at the moment.

Intuition calls it again! I do this all the time! But did I have a Bitcoin position during that break out? Did I fuck! I sold my $600 buy-in at $601.41 yesterday, and had buy-in set at $567. I really am fucking awful at trading. Why can I generally be pretty good at calling market but so fucking damn awful at trading? What is it about my decision making process that has such a strong desire to LOSE!?

Bought in at $628, and am proud to admit that due to all my ill-timed faffinf around, I have 0.5 Bitcoins less than I had when I sold at $645 before the correction down to $538......lowest I bought was $555.....sold at $540.  

Going offshore today...be gone for weeks.....probably won't be in position to sit staring at charts and make 'judgement' calls and try and outwit the market. It either trends North from here, or hits $750 - $800 and is smashed back down for C leg of DanV's Wave 4 correction.

[windjc]

The indicators and common sense all suggest that Bitcoin should correct a bit from here but my intuition says that that $615 target will be taken out and then some. B4 or after a correction I don't know, but I am finding it very difficult to get my heart behind the bearish cause at the moment.

Intuition calls it again! I do this all the time! But did I have a Bitcoin position during that break out? Did I fuck! I sold my $600 buy-in at $601.41 yesterday, and had buy-in set at $567. I really am fucking awful at trading. Why can I generally be pretty good at calling market but so fucking damn awful at trading? What is it about my conscious decision making process that has such a strong desire to LOSE!?

Bought in at $628, and am proud to admit that due to all my ill-timed faffinf around, I have 0.5 Bitcoins less than I had when I sold at $645 before the correction down to $538......lowest I bought was $555.....sold at $540.  

Going offshore today...be gone for weeks.....probably won't be in position to sit staring at charts and make 'judgement' calls and try and outwit the market. It either trends North from here, or hits $750 - $800 and is smashed back down for C leg of DanV's Wave 4 correction.

Yes. You suck at trading because you fail to follow any of the rules of trading. I and others told you to hold your long position. And you said "no." Until you can say "yes" you don't deserve trading profits.

Have fun on your vacation.

[oda.krell]

Daily SMA200. 2nd attempt.

[sgbett]

That said, the main reason that I do believe bubble size growth will decrease over time is that I believe that as the market gets bigger, the market also becomes more professional, which also entails it becomes more opportunistic, which entails profits will be taken earlier (because if you don't take profits comparably early, someone else will, and suddenly there are no profits for you to take anymore - i.e. a game theoretic understanding emerges that profits need to be taken earlier as time progresses), which entails the bubbles will overshoot less than they did in the past.

I think that is spot on what is going to happen, its the best I'm hoping for in the circumstances. Any other crazy MOON ideas occupy the same part of my brain that thinks I'm gonna win the lottery or something, nice to dream but unlikely to happen!

That kind of choppy slower growth ties in with how I felt about it being harder now to hold as it rises, because there will be so many more profit-taking driven sell offs. They'll keep spooking the holders. If you are long term hold and skim though you should realise this isn't a problem, it doesn't matter if any price action is super-exponential or merely linear, your strategy remains the same, and it still works.

(Until it doesn't of course, but that should never be a surprise to anyone signed up for this roller coaster.)

[sgbett]

Daily SMA200. 2nd attempt.

I'm no chart expert but that first test was never gonna hold as the SMA50 was miles away, this one might - esp if the 50 crosses this time. Could be all kinds of gains if that happens!

edit: i dunno if its relevant but the SMA30 is very close to crossing, if i did this chart thing then i'd probably go for a 30/200 crossover as 200 is always the default 'long term' and 30 seems like the logical (monthly) medium term one to choose. like i say, i'm no expert though

[Torque]

That said, the main reason that I do believe bubble size growth will decrease over time is that I believe that as the market gets bigger, the market also becomes more professional, which also entails it becomes more opportunistic, which entails profits will be taken earlier (because if you don't take profits comparably early, someone else will, and suddenly there are no profits for you to take anymore - i.e. a game theoretic understanding emerges that profits need to be taken earlier as time progresses), which entails the bubbles will overshoot less than they did in the past.

I think that is spot on what is going to happen, its the best I'm hoping for in the circumstances. Any other crazy MOON ideas occupy the same part of my brain that thinks I'm gonna win the lottery or something, nice to dream but unlikely to happen!

I generally agree, as it will take an even higher volume of money to make a bubble go parabolic to the same relative level (5x - 6x) as past bubbles.  But to play devil's advocate, suppose we go through future periods where the bitcoin "awareness factor" spreads faster than previous times, and an influx of new bitcoiners has a higher incoming velocity (i.e., say 20x vs. 10x) than past bubbles?  So hyper userbase growth?  Higher velocity of new incoming users = higher volume of incoming fiat, resulting in possibly the same relative bubble height.

In terms of awareness growth, I believe we are going through one of those periods now, in that bitcoin awareness is spreading globally at a hyper-exponential rate than past periods.  This is what I think may fuel a hyper-bubble in the future.  Maybe not this next time, but at some future date.

Hopefully what I'm saying is making some sense.

Thoughts?

[sgbett]

That said, the main reason that I do believe bubble size growth will decrease over time is that I believe that as the market gets bigger, the market also becomes more professional, which also entails it becomes more opportunistic, which entails profits will be taken earlier (because if you don't take profits comparably early, someone else will, and suddenly there are no profits for you to take anymore - i.e. a game theoretic understanding emerges that profits need to be taken earlier as time progresses), which entails the bubbles will overshoot less than they did in the past.

I think that is spot on what is going to happen, its the best I'm hoping for in the circumstances. Any other crazy MOON ideas occupy the same part of my brain that thinks I'm gonna win the lottery or something, nice to dream but unlikely to happen!

I generally agree, as it will take an even higher volume of money to make a bubble go parabolic to the same relative level (5x - 6x) as past bubbles.  But to play devil's advocate, suppose we go through future periods where the bitcoin "awareness factor" spreads faster than previous times, and an influx of new bitcoiners has a higher incoming velocity (i.e., say 20x vs. 10x) than past bubbles?  So hyper userbase growth?  In terms of awareness growth, I believe we are going through one of those periods now, in that bitcoin awareness is spreading globally at a hyper-exponential rate than past periods.  This is what I think may fuel a hyper-bubble in the future.  Maybe not this next time, but at some future date.

Thoughts?

It certainly could [says the I'm-gonna-win-the-lottery part of my brain]

[oda.krell]

Agreed, sgbett, there's a better chance to tackle the SMA200 today in my opinion. Still not 100% sure we're going to stay above it then in the next days. Don't underestimate the sheer weight of the preceding bear market that's still lasting on us. Could take another few attempts before we conclusively leave it behind.

re: the "bubble size" discussion... agreed, the increased awareness of btc could lead to ever increasing numbers of new users which brings in multiples of the previous "fresh fiat" amounts needed to sustain the bubble growth rate. I still don't buy it. I probably have a somewhat lower "final" valuation in mind than many, and I almost certainly think it'll take a lot longer to get there than most here (in the range of up to a generation), so there's plenty of time for that, even with declining growth rate.

[sgbett]

yes 5 figures in 10 years is probably a more realistic target, though thoroughly less popular an opinion.

I hold for that scenario, prepared for zero, and insured against the outrageously unlikely moon scenario. I sleep well at night.

[oda.krell]

yes 5 figures in 10 years is probably a more realistic target, though thoroughly less popular an opinion.

I hold for that scenario, prepared for zero, and insured against the outrageously unlikely moon scenario. I sleep well at night.

I'd be happy with putting that one into the official Bitcoin investment brochure.

[BitchicksHusband]

5 figures won't take 10 months.

[sgbett]

5 figures won't take 10 months.

That's certainly another point of view!

[bitebits]

5 figures won't take 10 months.

$666.66 could even happen within 24 hours!

Going to put your post in my top5 posts sgbett

yes 5 figures in 10 years is probably a more realistic target, though thoroughly less popular an opinion.

I hold for that scenario, prepared for zero, and insured against the outrageously unlikely moon scenario. I sleep well at night.

[zimmah]

5 figures won't take 10 months.

That's certainly another point of view!

though i agree with this, i think it will be much closer to 10 months than to 10 years.

[Bitcoin_is_here_to_stay]

SMA 200 easily taken - do you think we will now take ~$676 resistance also soon?

[oda.krell]

6h, 12h, 1d, 3d and 1w MACD, all positive as of now. The 3d is declining and somewhat close to zero perhaps, and technically there's no closed green 1w candle yet, but you get the idea: confluence of momentum across all relevant time scales is overwhelmingly pointing towards another decisive move up.

Exceptions are always possible of course, but I personally wouldn't dare shorting right now.

[lebing]

 

[zimmah]

Some old charts i made back in may with fib fans seem still pretty accurate (not perfect, but still not bad).





If the chart manages to hold, than we will see $1000 no later than september 12th.

So far, the fib lines have shown support and resistance, although they do sometimes get broken for a short while. But usually not more than a couple of minutes. The middle lines also show some amount of support/resistance but much less than the outer lines. (Around June i thought we would stay above the 2nd lowest line instead of the lowest, but we fell down below it after a few days and stayed there, for now at least, as i expect us to climb towards higher lines soon). Possibly even the top line, but that would mean a serious rally.

[oda.krell]

This is starting to look a lot like the SMA200 re-test I've been arguing for in RyNin's thread. Staying above, or at least closing above $611, would mean support from SMA200. Not sure if that'll happen though, panic seems to be kicking in. Daily close above would be a pretty bullish sign on the other hand.

Next step in case it breaks: I'd much prefer if $600 holds, for the obvious psychological reasons, but even until $580 to $590 (SMA50) we're safe in my opinion, but that's about as low as I currently expect it to go, if at all.

It becomes problematic from $550 to $560, I think. Not finding support there will put a damper on the entire upwards trend we've been starting to trust since the April 11 bottom. If it would come to that, which I don't really believe to be that likely, we're probably going back to fight for the $470 to $510 region again.

[T.Stuart]

This is starting to look a lot like the SMA200 re-test I've been arguing for in RyNin's thread. Staying above, or at least closing above $611, would mean support from SMA200. Not sure if that'll happen though, panic seems to be kicking in. Daily close above would be a pretty bullish sign on the other hand.

Next step in case it breaks: I'd much prefer if $600 holds, for the obvious psychological reasons, but even until $580 to $590 (SMA50) we're safe in my opinion, but that's about as low as I currently expect it to go, if at all.

It becomes problematic from $550 to $560, I think. Not finding support there will put a damper on the entire upwards trend we've been starting to trust since the April 11 bottom. If it would come to that, which I don't really believe to be that likely, we're probably going back to fight for the $470 to $510 region again.

A balanced view.

But with a bit of luck we may not panic quite so much. I mean, there is absolutely no substantial meaning behind the latest news flash at all. It's a continuation of the current European attitude, nothing more, nothing less.

[oda.krell]

This is starting to look a lot like the SMA200 re-test I've been arguing for in RyNin's thread. Staying above, or at least closing above $611, would mean support from SMA200. Not sure if that'll happen though, panic seems to be kicking in. Daily close above would be a pretty bullish sign on the other hand.

Next step in case it breaks: I'd much prefer if $600 holds, for the obvious psychological reasons, but even until $580 to $590 (SMA50) we're safe in my opinion, but that's about as low as I currently expect it to go, if at all.

It becomes problematic from $550 to $560, I think. Not finding support there will put a damper on the entire upwards trend we've been starting to trust since the April 11 bottom. If it would come to that, which I don't really believe to be that likely, we're probably going back to fight for the $470 to $510 region again.

A balanced view.

But with a bit of luck we may not panic quite so much. I mean, there is absolutely no substantial meaning behind the latest news flash at all. It's a continuation of the current European attitude, nothing more, nothing less.

Oh, I agree. It's more or less "no news" news: Banks are still allowed to take customers that work in the Bitcoin field, but are not supposed to dabble in it themselves until: regulation regulation regulation (let's see what that'll look like).

But as always, technicals and fundamentals work in tandem. And this news item came a time where the market is, once again, in doubt about where to go. Small scale volume is surprisingly supportive of the ~$600 level, but larger volume orders are, by and large, of the selling variety, for whatever reason (impatience, risk control, "directing" the market -- doesn't really matter). So even "no news" news can be enough to trigger a brief burst of panic.

[Bitcoin_is_here_to_stay]

6h, 12h, 1d, 3d and 1w MACD, all positive as of now. The 3d is declining and somewhat close to zero perhaps, and technically there's no closed green 1w candle yet, but you get the idea: confluence of momentum across all relevant time scales is overwhelmingly pointing towards another decisive move up.

All MACDs between 1h and 12h became red now.

[Tzupy]

I wonder if oda.krell will post a bearish scenario. So far he was called a 'short-sighted perma-bear' for being rationally bullish.
If he posts a bearish analysis he may be called a 'bear troll'!  Seriously, there are reasons to look at the bearish scenario:
- the uptrend above 600$ (since 26th May) was pumped with $ swaps on BFX and the loans have since ballooned to almost 30M$.
- the uptrend was helped by a (temporary?) removal of BTC from the market, possibly used to pump certain altcoins.
- the Chinese bagholders are getting impatient, and just the lack of new FUD prevents some serious dumping.

[Bitcoin_is_here_to_stay]

I wonder if oda.krell will post a bearish scenario. So far he was called a 'short-sighted perma-bear' for being rationally bullish.
If he posts a bearish analysis he may be called a 'bear troll'!   Seriously, there are reasons to look at the bearish scenario:
- the uptrend above 600$ (since 26th May) was pumped with $ swaps on BFX and the loans have since ballooned to almost 30M$.
- the uptrend was helped by a (temporary?) removal of BTC from the market, possibly used to pump certain altcoins.
- the Chinese bagholders are getting impatient, and just the lack of new FUD prevents some serious dumping.

I agree. I am most worried about almost everybody (reasonable) being convinced we are going up and too many leveraged longs on 'Finex (in proportion to actual bids). Will see.

[inca]

I wonder if oda.krell will post a bearish scenario. So far he was called a 'short-sighted perma-bear' for being rationally bullish.
If he posts a bearish analysis he may be called a 'bear troll'!   Seriously, there are reasons to look at the bearish scenario:
- the uptrend above 600$ (since 26th May) was pumped with $ swaps on BFX and the loans have since ballooned to almost 30M$.
- the uptrend was helped by a (temporary?) removal of BTC from the market, possibly used to pump certain altcoins.
- the Chinese bagholders are getting impatient, and just the lack of new FUD prevents some serious dumping.

Tzupy = perma bear

[oda.krell]

6h, 12h, 1d, 3d and 1w MACD, all positive as of now. The 3d is declining and somewhat close to zero perhaps, and technically there's no closed green 1w candle yet, but you get the idea: confluence of momentum across all relevant time scales is overwhelmingly pointing towards another decisive move up.

All MACDs between 1h and 12h became red now.

Yes. One of the weakest, and admittedly, most thoughtless predictions I made in there, in my opinion.

I suppose the confluence of upwards momentum has prevented us from a sharper drop so far, but nonetheless: at the time of posting, price was at ~$650, and it went down as much as $40 in between. Not enough for me personally to be tempted to trade the swing, but definitely not what I thought was going to happen when I posted the above.

I'm planning to run a test on a a MACD combination strategy, to see if the intuition that I (and many others, as far as I know) have about matching momentum across several time scales is actually correct and profitable.

[Bitcoin_is_here_to_stay]

Everybody on vacation or not interested in TA anymore?

I think we haven't bottomed up yet in $590s, so far we are more like going down, step by step.

Where do you think it will end? I hope somewhere above $550, although it looks like we are in a short-term bearish phase and even 3d MACD are consistently red across exchanges.

[Bitcoin_is_here_to_stay]

I agree that it started to look better last couple of hours, although feels like this stalemate can last for weeks if not months. Is it true that the # of btc transactions if falling?

Btw, I am not shorting, I am buying at the dips, believing that we are going up *sometime*, although would not be surprised if it would take months. On the other hand, I do not think we can go down much lower, $450 would be absolute bottom, but I do not think it happen, bottom somewhere in $5xxs much more likely. The bigger problem seems to be lack of enthusiasms and buyers for new rally. Let's hope ETF etc will take care of it.

[oda.krell]

Interesting observation, MAbtc. Thanks.

To answer an earlier question: myself, I'm on vacation currently, and, yes, I personally do notice a bit of "analysis fatigue".

That said, I am watching, peripherally, if selling pressure is substantially increasing to the point where the current price level 500s to 600s breaks down , but I don't see that happening so far. In absence of that, I am watching the development through the fibonnacci lense I posted about a few pages ago. From that perspective, we're still on course for leaving the 2013/14 bear market behind.

[Bitcoin_is_here_to_stay]

we're still on course for leaving the 2013/14 bear market behind.

I hope so, too, although last developments are not for those faint of heart .

Strangely, according to their webpage, Bitfinex longs are still almost unchanged at 30M. Would be nice to get it over with with a flash crash or at least consistent decline over couple weeks.

[Tzupy]

oda.krell, you missed the chance to post the bearish scenario I was asking for.
Now the bullish scenario has been invalidated and the bearish one (capitulation) is going strong.

IIRC you advised someone to buy a couple of months ago because it looked 'safe' (bear market seemed over).
If so, then IMO you should advise them to sell now or on the rebound that will follow, they can buy back below 300$.

[oda.krell]

oda.krell, you missed the chance to post the bearish scenario I was asking for. :D
Now the bullish scenario has been invalidated and the bearish one (capitulation) is going strong.

IIRC you advised someone to buy a couple of months ago because it looked 'safe' (bear market seemed over).
If so, then IMO you should advise them to sell now or on the rebound that will follow, they can buy back below 300$.

Different time scales, and different trading goals. My posts from May talking about buying support in the mid 400s, leading to the relatively unconditional (compared to my usual statements at least :D) buying recommendation at $459, were on a different, larger trading time scale compared to what you have in mind, I believe.

Also, I don't see evidence that this level (the 400s) won't be supported by buying now, if we should even go there. Not saying it's impossible that we break through into the 300s, but I'm not expecting it.

That said, lots of trading opportunity in between then and now. But for a lack of time to write long essays, but also because of the above mentioned different goals I have in mind for this thread, I'd rather leave the shorter term trades out of my analysis.

[ElectricMucus]

[Wilhelm]

Is it me or did the triangle break upwards with some volume... meaning your analysis could be faulty. 

[ElectricMucus]

That's not how Bollinger Band Width works. It's a measure of volatility.

[oda.krell]

I figured that BBW graph wasn't supposed to be a (broken) triangle, but care to explain what you did do there? I'll freely admit, I have no idea what indicator/technique you're using there, and I'm on TV myself.

[ElectricMucus]

The idea is that after a period of decreasing volatility (that "triangle" on BBW) the market tends to "remember" the volatility of the prior breakout and tries to relive it.  The real target is where BBW slows down and forms a top, the price target is more of a guess of how that might happen.

[ElectricMucus]

Oh wow that failed epically. Punched right through.

[Ovum]

The idea is that after a period of decreasing volatility (that "triangle" on BBW) the market tends to "remember" the volatility of the prior breakout and tries to relive it.  The real target is where BBW slows down and forms a top, the price target is more of a guess of how that might happen.

So, what is (was) in this case the previous breakout. For what you said it seemed the price would break up, but from the graphic, there's the sign down that was accurately correct. So why you say that failed epically?

[ElectricMucus]

The idea is that after a period of decreasing volatility (that "triangle" on BBW) the market tends to "remember" the volatility of the prior breakout and tries to relive it.  The real target is where BBW slows down and forms a top, the price target is more of a guess of how that might happen.

So, what is (was) in this case the previous breakout. For what you said it seemed the price would break up, but from the graphic, there's the sign down that was accurately correct. So why you say that failed epically?

To be fair we had a little support at the predicted target as the fall halted for about half a day, what I didn't expect was that it didn't bounce at all. Too fiddly for me, but if you think I'm on to something feel free to use it.

[wasserman99]

we're still on course for leaving the 2013/14 bear market behind.

I hope so, too, although last developments are not for those faint of heart .

Strangely, according to their webpage, Bitfinex longs are still almost unchanged at 30M. Would be nice to get it over with with a flash crash or at least consistent decline over couple weeks.

This is likely what will happen. A massive decline in the bitcoin price will not permanently damage the bitcoin network, the bitcoin economy, nor bitcoin itself. Booms and busts are natural to happen in any economy or industry or sector and is appears that we may be going through at least a mini bust.