I'm expecting the breakout to happen soon. Meaning that we will break $5.4 - $5.5 and then test $7.2 fairly soon after that. Breakout downwards would be very counter-intuitive taking into account that Bitcoin has had the biggest news coverage in over 6 months. And that coverage has been overall fairly positive I believe.
However I've seen the market do some counter-intuitive stuff before, so anything is possible. We'll have to wait and see.
It's still too early... we may breakout and see 7.2, but we'll be right back here before it's said and done unless we dip a bit or at least go sideways for a bit more.
Great idea! I could use a $2-$2.50 trading range!
That would be pretty awesome for a bit.
I'm generally in agreement with Technomage - I don't see any real breakout down. IMO, that would take an overall reduction in the amount of bitcoin awareness. This is not happening at all. Lots more people are hearing about it, and curious.
The coverage is such that I'm actually expecting us to get some new players, possibly major players into Bitcoin thanks to that. It will take them time to learn about Bitcoin and get money in however.
My gut tells me that some are in, testing the waters, not wanting to make too big a splash too quick. This effect will be much more noticeable in a month.
Bitcoin needs this a lot, our market cap is so ridiculously tiny at the moment that I don't feel very comfortable. It's so easy for any decent sized trader to play with and manipulate the market. A larger market cap would be a healthy direction. This time I think we can actually sustain a larger market cap (although it will probably overshoot big time and bubble once again).
Again, I agree. $45M is mighty small in the grand scheme of global business. It took hours last night to watch 9K BTC get bought up on bitcoinica - if it wasn't (I think) "artificially" slowed - by not filling as fast as possible, it could shake the market a bunch. I've seen my own orders (just in the hundreds of BTC) filled quickly, and show in the chart.
$45M is close to a typical large second round of VC financing. Figure, maybe double that, then you're ready to cash out in an IPO - so if I extrapolate a little - maybe I might look for upside to $10 mid term (somewhere now-fall) then once it "hits the big time" the minimum valuation will need to be on the order of $1Billion to be "taken seriously"
I'm quite sure bitcoin can sustain $100M cap, but I'm not sure that even half of that $1B number is currently sustainable. ($50/1BTC). I can see it ramping quickly, though - look at other extreme high growth rate ideas (like Facebook, or Groupon) and we can see that a $1B market cap w/in one year isn't out of the question.
The small market cap is where I see the most risk for anything I've invested in bitcoin. It is just too easy to manipulate.
My crystal ball tells me there are more bubbles than one to contend with in the future. I think bitcoin is highly susceptible to these bubbles while it's still in this primary growth phase. Mostly we're seeing BTC used for speculation - either directly, or via business investments (i.e. venture capital, mining). We'll have to get through the first part of this venture development phase before bitcoin is commonly used by the general public, for regular shopping.
IMO, there's not enough leverage. One of the great values of leverage is to be able to short BTC, and thereby help hold the rate of price increase down to rational levels. Another brokerage or two to compete with bitcoinica would be an awesome help, and bring a good deal of liquidity to the market.
The fact that bitcoin is bootstrapping businesses, makes for very likely exponential growth. Think about it, if you're creating the business by raising capital in the form of BTC, folks start speculating on the business AND the BTC, raising a business's valuation extremely rapidly compared to "acutal" growth. Exponential growth is very hard to predict, and very subject to market bubbles (i.e. dotcom boom) - this could skyrocket a Major bitcoin player into the forefront of the internet business world in record time. $0 -> $6B in 3yrs or less.
Ya, Technomage, I think you're right. I'm looking for a large breakout to the upside. I'm looking for a test of the $5.25-$5.5 resistance, and a bounce back down here to the $4.75-$5 neighborhood. If we can see that I think some folks would feel safe to go long with larger positions, given an established hard bottom. Once that $5.50 resistance is pierced, it looks like it's pretty much straight to $7ville.