94% correction? [46% so far]

[N12]

I have had an interesting thought lately. What if November to January was a brief correction from the 6 months long bear market which is over now?

If we assume the top is 7.22 and there is again a months long 94% "consolidation", the low would turn out to be 0.45 USD.

Food for thought.

[proudhon]

I have had an interesting thought lately. What if November to January was a brief correction from the 6 months long bear market which is over now?

If we assume the top is 7.22 and there is again a months long 94% "consolidation", the low would turn out to be 0.45 USD.

Food for thought.

I don't think that's unreasonable.

[N12]

Perhaps let me add some technical evidence:

Daily RSI confirms the turn down at 6.2 by a lower high. We still haven’t seen it above 60 ever since the Bitcoinica crash

Daily MACD is bouncing off and about to return to negative territory after a false bounce off ~0.

30d SMA (the famous Nagle chart) was 6.2, where it stopped rallying.

Sentiment is altered ever since the Bitcoinica 4.64 low. There may be other factors like the (political) issues around BIP 16.

[N12]

And now my hypothesis for why this could be happening:

Bitcoin distribution is still very poor, as can be seen by the big sells, bid walls and ask walls which lead to a concentration of BTC.

The fact that we have had one year of difficulty 1 at the beginning along with a couple dudes from the cryptography mailing list and the same BTC production as nowadays does not help.

There is also little influx of new Bitcoin users, differently from what people hoped to see the Good Wife episode do.

[Vandroiy]

Mh... I dunno, 0.45 USD/BTC would be dangerously low. Market cap dropping below 10M would already be quite extreme, below 5M could be dangerous and probably would call in enthusiasts. I hope it doesn't come to that, since the situation might endanger the Bitcoin market itself, depending on how wealthy or determined the true enthusiasts really are.

I still fail to fully understand the psychology of the people causing this whole chaos, I just know they strengthen mid-term trends and change their minds in some fractal pattern. But the chart analysis stuff is increasingly useless; everybody either uses it or expects the others to use it, and so the meta-analysis of other traders plays out like rock-paper-scissors.

Bottom line: it's Bitcoin, anything could happen.

[N12]

Mh... I dunno, 0.45 USD/BTC would be dangerously low. Market cap dropping below 10M would already be quite extreme, below 5M could be dangerous. I hope it doesn't come to that, since it might endanger the Bitcoin market itself.

Yes, exactly my thoughts when Bitcoin went IMO pretty low with 4 USD in September.. Bitcoin is kind of too small and too poorly distributed to exist. It’s a race for adoption, and we are losing it.

[Piper67]

Chart analysis = pattern analysis = reading goat entrails = consulting the Oracle at Delphi

[N12]

Now, for the fellow chartists: http://www.sierrachart.com/userimages/upload_2/1328458777598.png

We have 3 trendlines, let’s call them short, mid and long term.

Short term is broken, mid term is about to be tested now.

[proudhon]

I know people don't like forecasts based on the order book, but tracking order book changes has been just as reliable as anything else.  So, it's worth noting that the order book appears to be flipping again with asks piling up.  Just a few days ago after some large movements there were less than 200,000BTCs up for sale.  Now there's just over 260,000.  This, in combination with recent long over-leveraging and trend line breakdown is good enough information for me to stay the hell out.  It's beginning to look like the correction from $7.2 is going to last pretty long and could be unnervingly deep.

What I'm guessing is another month or so after further downside from here.  Then a rally back up but not higher than $7.2 - maybe in the $5 range.  I see this sort of behavior going on for a long time so long as bitcoin adoption fails to pick up.

[gewure]

the speculation forum is just plain and simple madness.

the bulls talk about reaching 1 billion this year, the bears talk about reaching 0.42$ soon.

chill down, folks. listen to the music and relax^^

[N12]

I bet you would have said the same if someone predicted it in May-August.

[gewure]

I bet you would have said the same if someone predicted it in May-August.

yes, and 0.42$ turned out to be pretty offshore

[proudhon]

I bet you would have said the same if someone predicted it in May-August.

Exactly.  Most people seemed to think it was utter stupidity to claim the price would fall back down below $5.

[teflone]

Learn to read charts, and trendlines are the last thing to look at..

This is the last stop down to get coins cheap..

Lets see what Volatilityoinica has in store for us this week!

[StewartJ]

Mh... I dunno, 0.45 USD/BTC would be dangerously low. Market cap dropping below 10M would already be quite extreme, below 5M could be dangerous and probably would call in enthusiasts. I hope it doesn't come to that, since the situation might endanger the Bitcoin market itself, depending on how wealthy or determined the true enthusiasts really are.

I still fail to fully understand the psychology of the people causing this whole chaos, I just know they strengthen mid-term trends and change their minds in some fractal pattern. But the chart analysis stuff is increasingly useless; everybody either uses it or expects the others to use it, and so the meta-analysis of other traders plays out like rock-paper-scissors.

Bottom line: it's Bitcoin, anything could happen.

That's what I've concluded.

IMHO, Bitcoin is a highly speculative commodity and "day-trading" with it is just gambling
your USDs away.

I leave it to the day-trading "experts" to ride those daily rallies, avoiding impending smack downs,  
divining fake or real Ask Walls, while conveniently blaming Bitcoinica and/or a Manipulator for all their
trading woes.  Have fun chasing that rabbit.

Bitcoin is great way to buy and sell stuff on the internet, and for those early adopters, maybe
it's an investment.

But if you're remotely considering trading in Bitcoins like you would a stock, please remember
the aforementioned words of wisdom: it's Bitcoin, anything could happen.

[Technomage]

I genuinely don't know what is going to happen in the short term but from a long term perspective I still see no reason to panic or sell a single BTC. I'm staying out of this madness as well, but my position is 100% BTC. Unless something profound enough happens that changes my mind, I will keep this position.

The situation is quite neutral from a fundamental perspective, we've had some news recently but not much. At the same time Bitcoin is now constantly used more than it was used in the last 3 months of 2011. This is data from the transaction count. There have been some boosts this month such as people sending coins to exchanges for selling them and the recent Silk Road boost. But that doesn't explain that the transaction count is constantly high these days.

On the other side of the coin we still have the confidence decline that was caused by the "Bitcoinica event" and the confusion and doubt that has come from the BIP debates. The first issue will fade and be less meaningful every day, unless the people who caused the event forget about it and make the same mistakes again. The second issue is more fundamental to me personally but I have faith that the Bitcoin development team will be able to overcome that issue. This month and next month in particular is very important and revealing as far as P2SH and the entire development of Bitcoin is concerned.

In other words I have no other tools in my toolkit right now other than being in or out long term. I see a small possibility that the development issues will make me lose faith in the whole project within the next couple of months but only if they fail miserably. We will see. Otherwise I'm very much in.

[N12]

I bet you would have said the same if someone predicted it in May-August.

yes, and 0.42$ turned out to be pretty offshore

32*0.06=1.92

Now do the same for 7.22

[proudhon]

As much as I hate to say it, I don't much care where the price ends up anymore.  I've stopped trying to increase my bitcoin position and instead am primarily concerned with increasing my USD position.  Every few days when I spot a clear enough trend, I'll trade into BTC, then back out again as quickly as I profitably can.  Sure, this means that in the event Bill Gates come along and drops $10 billion in the bitcoin market I'll miss out on becoming an instant millionaire.  But, it also means I'm not going to lose the increase I've already managed to grab from people dicking around on bitcoinica, or if whatever-his-name-is-with-over-300,000-BTCs comes along and decides to cash it all out.  I'm staying in USDs and I'll swap around to take more of them from whomever wants to give them up.

[Technomage]

32*0.06=1.92

Now do the same for 7.22

I hope you're not seriously trying to predict future price based on that? To me that is just as relevant as trying to read Gavin's palm and predicting the price based on that, or looking at the stars for answers.

That feels almost like trolling to me.

[N12]

No, I’m not. But I’m telling him that he would have found people crazy too if they suggested Bitcoin would decline that far back in May to August.

Also, if Technomage says there is "no reason to panic or sell a single BTC", then IMO it’s time to shit your pants.