Having Fun: Bitcoinica 24-Hour Spread-Free!

[Koekiemonster]

I was having the same problem as you Notme, but I fixed it in the way Zhou said and it works fine now

Great actions and I hope you keep improving bitcoinica in the way you've been doing Zhou!
The next thing I'd like to see is the Zhoutong price integrated in the site so I don't have to use an add-on.
Ever since I downloaded that add-on, I'm seeing this, I already uninstalled it:
http://postimage.org/image/6657sy0az/

The part after the red cross means some sources of this page are being send unencrypted.
Also, I redeemed a EUR MTGOX code at your site and mailed support about it after it failed since mtgox says it's redeemed. Could you look into this?

[zhoutong]

How do you 'activate' the legit mtgox spread?  Im on bitcoinica trading page and I see
4.6/5.2 while on mtgox its 4.8/5.1 ??

4.8/5.1 LOL... You scared me successfully because I didn't check prices.

Well, tiny orders don't count. We need at least X, where X can be any number between 50 and 350.

[tickets]

Given how thinly traded BTC is currently, orders under 50 BTC are not 'tiny'....  look at the median fill which happens between support levels.

At any rate, if this is how the deal works it would be best to disclose it up front.

Do I actually have to offer a Bid or Sell of 50 BTC to view the mt gox spread?  I am 100 BTC long when I observed the previous spread and am still seeing spread much wider than MTGox

[Koekiemonster]

Zhou could you look at my reply?

[zhoutong]

Zhou could you look at my reply?

Hi,

We will send the EUR code back within 24 hours. Sorry for the delay, but this is a manual process.

Thank you for your patience!

[tickets]

Bitcoinica not executing orders today, I put in a bunch of limit and then 'instant' market orders
when ask was 6.97, that was about 10 minutes ago - look now

http://www.diigo.com/item/image/1dbpl/1c6u

[Mushoz]

Bitcoinica not executing orders today, I put in a bunch of limit and then 'instant' market orders
when ask was 6.97, that was about 10 minutes ago - look now

http://www.diigo.com/item/image/1dbpl/1c6u

Because they are out of USD reserves. That's why there's a * next to the buy price. You won't be able to open new positions as long as that asterisk is there. You can close shorts however

[tickets]

Wow, pretty scary - I don't see any explanation of the "*" annotation on the price on that page, the buttons should be greyed out with some big red warning to tell users the system isn't working... same for all the counter-intuitive and undocumented ways to set stops etc... I guess bitcoin just isn't ready for alpha release yet.

[Timbo925]

Indeed the bad explanation of stops made me drop a long position when I wanted to set a stop if the price dropped. Was just 10BTC the * was already up so couldn't take same position again.

[tickets]

Yes I lost money too, by trying to set a stop for a long position I had bought, using the Buy button I ended up with double the shares at a much-too-high price and had to liquidate some.

I've also Sold positions at a profit by hitting a stop and observed that no profit got added to my balance, and seen 'trailing stops' execute at odd prices not within the recent trading range.   Go figure.

Also the site offers 5:1 leverage to encourage 'advanced day traders' --- any experienced daytrader knows to avoid this kind of slippage, you start out with 1.5 % or more loss immediately from the spread.

I mean it's a nice student project, but just a few more paragraphs of text next to the functions and big red warnings about things that just don't work yet would cost nothing to add - and would help protect users who mistake it for a beta-quality site. 

Bitcoin is currently like a penny stock - it is illiquid and thinly traded, which means that small fluctuations in demand cause disproportional swings in price.  There are good reasons that financial firms will not allow margin for such stocks.

 What we have with bitcoin is something intended to operate as a currency, but in order to do so, it needs to have more liquidity, be widely held, have market makers etc.  Those things cannot happen if the units are being traded and leveraged which multiplies the volatility. Such premature speculation will discourage and likely prevent btc's wider adoption as a currency. 

[notme]

Works for me.

Volatility is caused by newbies who don't know wtf they are doing and jump in head first.  Learn to use the tools before you trade.

You complain about lack of liquidity, then complain about speculators.  How do you get better liquidity without speculators?  Businesses just want to buy orders off the books and be done with it.

[tickets]

Actually I've been trading since the late 90's thank you; at many times it was my primary income.
 
BTC is a very thinly traded commodity by any standard, volatility is not caused by 'newbies' it is caused by more supply and demand relative to the amount of commodity immediately available on the order stack.    Markets for currency or bond trading have deep liquidity meaning you can buy or sell as much as you like at the current price and it won't move price much.

This is in stark contrast to BTC or penny stocks, where if I were to liquidate a $1M position  on top of  the usual stack of BTC  bids in the $100-$1000 range at a given price, it will the stack past its equilibrium point... you see this on a daily basis with BTC and any illiquid issue.   

I'm not really saying this is a bad thing. It makes for fun sport if you want to speculate - my point was only that providing leveraged speculative trading opportunity works directly against the goal of establishing BTC as a widely held currency.  BTC can either 'stay small', locked up by leveraged daytraders, or it can grow big and become a stable, highly liquid commodity that functions as a currency - just not both. 

[finway]

So running out of reserve, and cause a dump.

Is this fun ?

[SkRRJyTC]

I'm not really saying this is a bad thing. It makes for fun sport if you want to speculate - my point was only that providing leveraged speculative trading opportunity works directly against the goal of establishing BTC as a widely held currency.  BTC can either 'stay small', locked up by leveraged daytraders, or it can grow big and become a stable, highly liquid commodity that functions as a currency - just not both. 

Aren't "stable highly liquid commodities" also full of "leveraged speculation and daytraders"?

[notme]

I'm not really saying this is a bad thing. It makes for fun sport if you want to speculate - my point was only that providing leveraged speculative trading opportunity works directly against the goal of establishing BTC as a widely held currency.  BTC can either 'stay small', locked up by leveraged daytraders, or it can grow big and become a stable, highly liquid commodity that functions as a currency - just not both. 

Aren't "stable highly liquid commodities" also full of "leveraged speculation and daytraders"?

Yea... please explain how we increase liquidity without leverage.  Sure, there are fund inflows, but we can't count on that.  And not everybody that holds BTC wants to waste the hours I do softening the spikes.

[tickets]

[/quote]
Aren't "stable highly liquid commodities" also full of "leveraged speculation and daytraders"?
[/quote]


Yes absolutely, but they profit from very small percentage fluctuations - large fluctuations don't happen due to the deep liquidity.  It's more efficient to do that type of trading using derivatives actually options, futures, etc.. even less capital is required to control large sums for temporary time frames.  

Think of a physical analogy - you have a glass full of ice cubes, vs a gallon of water.  The ice takes much more volume, and if you add or remove a few cubes it will change the level in the glass much more abruptly than if you remove the same amount of H20 as water.

[Crypt_Current]

Aren't "stable highly liquid commodities" also full of "leveraged speculation and daytraders"?

Yes absolutely, but they profit from very small percentage fluctuations - large fluctuations don't happen due to the deep liquidity.  It's more efficient to do that type of trading using derivatives actually options, futures, etc.. even less capital is required to control large sums for temporary time frames.  

Think of a physical analogy - you have a glass full of ice cubes, vs a gallon of water.  The ice takes much more volume, and if you add or remove a few cubes it will change the level in the glass much more abruptly than if you remove the same amount of H20 as water.

I'm not getting this analogy.  Can you dumb it down a shade?

[SkRRJyTC]

Yes absolutely, but they profit from very small percentage fluctuations - large fluctuations don't happen due to the deep liquidity.  It's more efficient to do that type of trading using derivatives actually options, futures, etc.. even less capital is required to control large sums for temporary time frames.  

Think of a physical analogy - you have a glass full of ice cubes, vs a gallon of water.  The ice takes much more volume, and if you add or remove a few cubes it will change the level in the glass much more abruptly than if you remove the same amount of H20 as water.

I understand smaller market = more volitility... but the only way we are going to get bigger is with the help of leverage and day traders.

[tickets]

I'm not getting this analogy.  Can you dumb it down a shade?

You're teasing me, right?

If not, do the experiment yourself.  Pour a gallon of gin into one container, put it next to a cup of ice cubes.  Then remove the equivalent of 1 oz liquid from each, and measure the change in level. 
Then, fedex me the remaining gin.

[notme]

I'm not getting this analogy.  Can you dumb it down a shade?

You're teasing me, right?

If not, do the experiment yourself.  Pour a gallon of gin into one container, put it next to a cup of ice cubes.  Then remove the equivalent of 1 oz liquid from each, and measure the change in level. 
Then, fedex me the remaining gin.

I think he's not getting how this relates to trading... that's where I'm failing too.  I'd hope we all know ice is less dense than water.