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Author Topic: "No Reserve" explanation  (Read 7952 times)
notme
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December 29, 2011, 03:17:28 AM
 #21

They can always do this.  How is this different from normal?

It's different because there are more longs... therefore the squeeze will be more severe.  I'm not saying someone will be willing to risk it since this is a very bullish indication, but if you could drop the price low enough (below 3.5 should start the ball rolling) you could buy a lot of coins at a discount.  However, there are so many buy orders on MtGox, this would take roughly $300k... or $30k on 1:10 margin.  But to trade on margin you have to use Bitcoinica, and much of your sale would be filled by pending Bitcoinica buys before it hits MtGox.  Probably not going to happen, but Zhoutong probably wishes it will.  Otherwise, he may have a liquidity problem for a while as people will be unwilling to take smaller profits out of the fear of not being able to reenter.

https://www.bitcoin.org/bitcoin.pdf
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chunglam
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December 29, 2011, 03:24:44 AM
 #22

Hi Zhoutong, are you sending the signal to "The Manipulator"? Smiley

I'm not, but everyone knows this.

So I assume that the Manipulator already knows and I just want to let traders know how serious this can be.

So, what is your recommendation for normal trader like me?
cypherdoc
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December 29, 2011, 03:35:30 AM
 #23

LOL!  please think of a fix that will make everyone money.

Well, the best way for you to make money right now is to take advantage of the imminent long squeeze.


Why do you believe there will be a long squeeze?

IMO, it's the other way around:
-Because you can't buy BTC on Bitcoinica, anyone who wishes to buy BTC will need to buy them on on MtGox, leading to higher prices.
-Because you can't buy BTC on Bitcoinica, any bull with BTC will be LESS likely to sell because they can't re-buy them if they sell too low.


I don't see your logic.  If something is in short supply, its price goes up, not down.

Am I missing something?

no, you are not.  this prolonged rise in the market has placed Zhoutong in an untenable position IMO.  when you go long, he has to go short.  IMO he is caught in a massive short squeeze and is desperate to get you guys to either sell or go short to provide btc liquidity so he can cover his losing positions.  i think the dam has broken and his advice smacks of manipulation in the name of self preservation.

when are you guys going to learn?  problem after problem after problem keeps cropping up.  Bitcoinica is doomed.
notme
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December 29, 2011, 03:37:56 AM
 #24

Hi Zhoutong, are you sending the signal to "The Manipulator"? Smiley

I'm not, but everyone knows this.

So I assume that the Manipulator already knows and I just want to let traders know how serious this can be.

So, what is your recommendation for normal trader like me?

That depends entirely on your timeframe.  Short term, we may see a big dip.  Longer term, there are obviously lots of buyers -> price rise, just make sure you don't use too much leverage or you will get liquidated in the squeeze if it occurs.  Personally, I have liquidated my long position for a nice profit and will reenter if it dips.  If it doesn't most of my margin balance will be moving to MtGox for my bot to play with.  Except for the recent profit (which I assume can't be converted) it's all BTC, so technically I'm still long, just no Bitcoinica position.

https://www.bitcoin.org/bitcoin.pdf
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mjcmurfy
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December 29, 2011, 03:41:07 AM
 #25

I do not believe the price will be going up further. There is simply too much profit to be made by squeezing out the longs. The temptation to pull the trigger is ramping up and up, and the market is already seriously overbought. And even if the bulls don't decide to cash out, bitcoinica is going to have to replenish their USD balances somehow.

I could be wrong, but it is going to be interesting finding out.
I'll be staying up for another few hours. I have moved 100% into USD.

http://www.bitcointorrentz.com/images/bct_button_117_30.png - BitCoinTorrentz.com: High-speed HTTP torrent downloads. 0.05 btc/gb. Up to 50% discount with free membership!
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December 29, 2011, 03:42:18 AM
 #26

LOL!  please think of a fix that will make everyone money.

Well, the best way for you to make money right now is to take advantage of the imminent long squeeze.


Why do you believe there will be a long squeeze?

IMO, it's the other way around:
-Because you can't buy BTC on Bitcoinica, anyone who wishes to buy BTC will need to buy them on on MtGox, leading to higher prices.
-Because you can't buy BTC on Bitcoinica, any bull with BTC will be LESS likely to sell because they can't re-buy them if they sell too low.


I don't see your logic.  If something is in short supply, its price goes up, not down.

Am I missing something?

There are a lot of long positions on Bitcoinica, so anyone with the power to push the price down will cause a lot of forced liquidations, and Bitcoinica will sell at very low prices.

Basically it's you sell X BTC, Bitcoinica will then sell X BTC to you at bottom price.


They can always do this.  How is this different from normal?

Now the opportunity is huge. And it's confirmed.

In normal situations, there are not that many long positions.

unfortunately, this is the first time i've seen a character flaw in Zhou.  a market maker like him should NEVER be talking like this.  the only reason he is IMO, is b/c he's trapped.
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December 29, 2011, 03:44:29 AM
 #27

i've told you what i think has happened.  in a small, immature market, the short selling Zhou provided has caused a long term unnatural suppression of the price over the past several months.

now we're seeing market fundamentals snap back in a vicious way.  lotsa ppl are going to get hurt...
mjcmurfy
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December 29, 2011, 03:45:52 AM
 #28

IMO, it has snapped back already and has overshot. It will be correcting in the other direction over the next few days/weeks.

http://www.bitcointorrentz.com/images/bct_button_117_30.png - BitCoinTorrentz.com: High-speed HTTP torrent downloads. 0.05 btc/gb. Up to 50% discount with free membership!
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December 29, 2011, 03:46:15 AM
 #29

IMO, it has snapped back already and has overshot. It will be correcting in the other direction over the next few days.

not until the carnage has occurred...
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December 29, 2011, 03:46:31 AM
 #30

OH FUCK
this is going against my expectations in a huge way

(BFL)^2 < 0
cypherdoc
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December 29, 2011, 03:47:44 AM
 #31

i smell blood in the water. 
cypherdoc
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December 29, 2011, 03:49:11 AM
 #32

btw, Dow futures are ramping right now and the USD is plunging again.  reflation is here. 

hold onto your Bitcoins.
mjcmurfy
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December 29, 2011, 03:49:48 AM
 #33

OH FUCK
this is going against my expectations in a huge way

It has only gone up 10c, or are we looking at different charts?

http://www.bitcointorrentz.com/images/bct_button_117_30.png - BitCoinTorrentz.com: High-speed HTTP torrent downloads. 0.05 btc/gb. Up to 50% discount with free membership!
Litt
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December 29, 2011, 03:52:06 AM
 #34

i've told you what i think has happened.  in a small, immature market, the short selling Zhou provided has caused a long term unnatural suppression of the price over the past several months.

now we're seeing market fundamentals snap back in a vicious way.  lotsa ppl are going to get hurt...

+1

BTC price won't be held down by Bitcoinica trading alone anymore and it's showing.
ineededausername
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December 29, 2011, 03:52:32 AM
 #35

OH FUCK
this is going against my expectations in a huge way

It has only gone up 10c, or are we looking at different charts?

I see upward momentum despite a massive amount of USD trapped in an insolvent bucket shop.  This is insanely bullish.

(BFL)^2 < 0
chunglam
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December 29, 2011, 03:53:04 AM
 #36

Hi Zhoutong, are you sending the signal to "The Manipulator"? Smiley

I'm not, but everyone knows this.

So I assume that the Manipulator already knows and I just want to let traders know how serious this can be.

So, what is your recommendation for normal trader like me?

That depends entirely on your timeframe.  Short term, we may see a big dip.  Longer term, there are obviously lots of buyers -> price rise, just make sure you don't use too much leverage or you will get liquidated in the squeeze if it occurs.  Personally, I have liquidated my long position for a nice profit and will reenter if it dips.  If it doesn't most of my margin balance will be moving to MtGox for my bot to play with.  Except for the recent profit (which I assume can't be converted) it's all BTC, so technically I'm still long, just no Bitcoinica position.

Thanks for your advice. I also have some Bitcoin holding (mining and profit from previous long position) besides current long position. I may consider to liquidate my current long position.
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December 29, 2011, 03:56:03 AM
 #37

I see upward momentum despite a massive amount of USD trapped in an insolvent bucket shop.  This is insanely bullish.

What I see is people buying without considering the implications of bitcoinica being insolvent.
I think whoever just bought those couple thousand coins is going to get burned badly.

http://www.bitcointorrentz.com/images/bct_button_117_30.png - BitCoinTorrentz.com: High-speed HTTP torrent downloads. 0.05 btc/gb. Up to 50% discount with free membership!
cypherdoc
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December 29, 2011, 03:58:19 AM
 #38

LOL!  please think of a fix that will make everyone money.

Well, the best way for you to make money right now is to take advantage of the imminent long squeeze.


Why do you believe there will be a long squeeze?

IMO, it's the other way around:
-Because you can't buy BTC on Bitcoinica, anyone who wishes to buy BTC will need to buy them on on MtGox, leading to higher prices.
-Because you can't buy BTC on Bitcoinica, any bull with BTC will be LESS likely to sell because they can't re-buy them if they sell too low.


I don't see your logic.  If something is in short supply, its price goes up, not down.

Am I missing something?

There are a lot of long positions on Bitcoinica, so anyone with the power to push the price down will cause a lot of forced liquidations, and Bitcoinica will sell at very low prices.

Basically it's you sell X BTC, Bitcoinica will then sell X BTC to you at bottom price.


They can always do this.  How is this different from normal?

Now the opportunity is huge. And it's confirmed.

In normal situations, there are not that many long positions.

this prolonged upward move has placed you into this untenable position.  further upward movement will make it even worse. 

so who will step up and sell to Zhou to allow him to cover and get out of a losing position?

i have lots of btc but am i going to sell to help you out?  NO.  you allowed everyone to sell them to me.
cypherdoc
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December 29, 2011, 03:59:34 AM
 #39

I see upward momentum despite a massive amount of USD trapped in an insolvent bucket shop.  This is insanely bullish.

What I see is people buying without considering the implications of bitcoinica being insolvent.
I think whoever just bought those couple thousand coins is going to get burned badly.

no, they are going to make a fortune as the price continues up to its equilibrium fundamental price which is MUCH higher than this.

are you short?
smickles
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December 29, 2011, 04:00:56 AM
 #40

I see upward momentum despite a massive amount of USD trapped in an insolvent bucket shop.  This is insanely bullish.

What I see is people buying without considering the implications of bitcoinica being insolvent.
I think whoever just bought those couple thousand coins is going to get burned badly.
That couldn't have been one trade, there was price fluctuation as the 7k went thru the pipes.

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