Something, something, something, technical analysis

[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.