The Great Spring Stability of 2012 [NEW POLL: JUNE EDITION!]

[N12]

I have posted about this a month ago, but it I think it deserves its own topic.



How long are we going to do this? Will 3.8 or 7.2 fall first? 4.3 or 5.48?

When will The Great Spring Stability finally come to its end?

Poll Results (monthly):

https://i.imgur.com/ExYhU.png

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[matthewh3]

I think it's do with all these (arbitrative) bots and bitcoinica that the prices have been so stable plus will also stay so pretty much. 

[Technomage]

My current assessment is that we may see a break over $7.2 as early as May. Could be later also but I won't be surprised if it happens this month.

I don't have any detailed explanations for this, it's just my general feeling on how Bitcoin is doing overall. This feeling is affected by the trend of increasing amount of positive news, my view on the growth of Bitcoin usage in general, impressive Bitcoin startups, market sentiment and price behaviour.

I'm happier with the current state of Bitcoin than I have ever been before. The market has disagreed with me in the past though so I might be wrong. In any case I have actually put my money where my mouth is. Decided to increase my long position. It's the first time I've done anything with my position since 2011.

Very excited to see what happens in the next couple of months. I really think that this seemingly stable period is going to end. It's just simple math, if Bitcoin continues to grow this market cap won't be enough. However it might be growing in a slower and less volatile way than before, which is good.

With my Bitcoin investment I'm not looking at a quick buck. In fact I'm happy if my investment retains its value over the long run. That's already okay. Anything better than that is just a bonus. Currently I'm doing well, my previous entry point happened to be fairly optimal and my average entry point is also good.

[bitcoinBull]

The band is getting pretty narrow, doesnt look like this will go on much longer.

Even assets much more liquid than bitcoin are very volatile. Other markets have leveraged trading as well, so I see no reason to infer that bitcoinica usage lowers volatility.

One notable difference is that information about bitcoin is the most perfect (21 million max). Most of the early few million coins still havent moved, but can never say for certain how many are lost.

Abundant buying pressure (to say nothing of media attention) indicates that the trend is up. Upward moves will also generate increased interest and convert spectators who are still on the fence.

[ineededausername]

Up we go again... what'll it be this time?

[adamstgBit]

Up we go again... what'll it be this time?

5.1?

wow the order books completely changed.


if we get to 5.20 short all the bitcoins 

[waspoza]

Many ppl are still short, time for some bear squeeze? 

[bitcoinBull]

Many ppl are still short, time for some bear squeeze? 

anyone still short deserves their pain. trend is clearly up.

[cypherdoc]

Many ppl are still short, time for some bear squeeze? 

anyone still short deserves their pain. trend is clearly up.

This times for real.

[bb113]

The easiest way to "kill" bitcoin at this point is to make all the speculators get bored.


*Edit= damage, not kill

[S3052]

The easiest way to "kill" bitcoin at this point is to make all the speculators get bored.


*Edit= damage, not kill

will also damage ppl who accept bitcoin payments in a hope for bigger price on the future

the moment people start talking about infinite stability and or speculators getting bored, the sentiment is ripe for a huge volatility increase. the past hours have already given a glimpse of what is coming

[waspoza]

The easiest way to "kill" bitcoin at this point is to make all the speculators get bored.


*Edit= damage, not kill

will also damage ppl who accept bitcoin payments in a hope for bigger price on the future

the moment people start talking about infinite stability and or speculators getting bored, the sentiment is ripe for a huge volatility increase. the past hours have already given a glimpse of what is coming

the slower we go the better taking out of the game large quantities of bitcoin at this price will help later when the price is bigger, nobody wants big volume and big prices

My stash need big prices!!1

[realnowhereman]

My own 0.02BTC (based on nothing).

Looking at the order books, the key observations are (1) the walls seem to have gone (or at least taken a long holiday), but that's not as surprising when you consider that (2) the volume in the order books has increased massively.

The implications of (2) are that the market is getting bigger.  It's getting bigger on both sides though.  That means that it's harder to move it with sudden impulses (notice that what we consider "big" moves these days are in the order of tens of cents... as recently as march, we could move by dollars in days).

The bitcoin economy is still growing while all this trading is going on.  Now, it can easily be the case that the economy grows but the price doesn't change much.  That's because the users might simply be using bitcoin as an easy way of transferring fiat.  We'd see that as increased liquidity on both sides (oh look -- that is what we see).  Let's call this state a "first order bitcoin economy".  More importantly for bitcoin price is that slowly, with a bigger and bigger bitcoin economy, enough products will become available for bitcoin that merchant A will find his supplier, merchant B will accept bitcoins too -- removing at least some of the need to exchange back to fiat.  At that point we have a "second order bitcoin economy".  This will result in increased demand for bitcoins, but (and this is the important consideration relative to the first order economy) reduced demand for fiat.  That process will continue of course, merchant B will eventually be able to buy from his supplier in bitcoins, and we'll get a "third order bitcoin economy".

Obviously, I'm making up my terms, and am going to be completely biased toward seeing bitcoin succeed.  But I hope I'm not imagining it: to my mind, the recent stability is indicative that a bitcoin economy is creating itself.  All it takes then is time.  What that means is a slowly, inevitably increasing, price.  And that is probably far better for bitcoin's success than another massive, unjustified run up and subsequent burst.

[SlaveInDebt]

^Pretty much, the more players in the game the less sway in the price.

Keeping it real,

SlaveInDebt

[cypherdoc]

the last 2 comments have been excellent but i'd add one thing.  even tho the economy is growing and the price has stabilized, there will still be points in time where the price will rise in fits and spurts as "realization" hits home that this thing called Bitcoin is truly a viable currency and store of value.  all you have to do is look at stocks the size of Apple to understand that you'd better get on board before this realization takes place or you'll be left chasing.

[S3052]

the last 2 comments have been excellent but i'd add one thing.  even tho the economy is growing and the price has stabilized, there will still be points in time where the price will rise in fits and spurts as "realization" hits home that this thing called Bitcoin is truly a viable currency and store of value.  all you have to do is look at stocks the size of Apple to understand that you'd better get on board before this realization takes place or you'll be left chasing.

+1. Prices move in waves. there is always calmness in between, but then the next big wave is coming. Who knows, perhaps we will never see 5 $ from below again, or 4.73 $.

[realnowhereman]

the last 2 comments have been excellent but i'd add one thing.  even tho the economy is growing and the price has stabilized, there will still be points in time where the price will rise in fits and spurts as "realization" hits home that this thing called Bitcoin is truly a viable currency and store of value.  all you have to do is look at stocks the size of Apple to understand that you'd better get on board before this realization takes place or you'll be left chasing.

Oh absolutely; I'm not under the misapprehension that price can only go up; nor that we can't have a big move down.  Just as you say though -- there is going to come a time when we leave a price behind and never return to it ($2 is well gone I think).

Basically... I see the price as being determined by "economic activity plus or minus speculative action"; speculative action is fairly big in the world of bitcoin; but the economy is growing and is growing steadily and remorselessly.  What do you economists call it?  Structural and cyclical?  Something like that?

I'm also commenting on much longer timescales than "next change"; I'm talking about years.

[proudhon]

God, this market has become so incredibly predictable now, and profitably so.  I mean, seriously, the manipulators, if indeed they even exist, have allowed their manipulations to become a very predictable and profitable venture.

[molecular]

God, this market has become so incredibly predictable now, and profitably so.  I mean, seriously, the manipulators, if indeed they even exist, have allowed their manipulations to become a very predictable and profitable venture.

hehe. interesting. so you're saying one can profit by selling above $5 and buying below $5? Well, if everyone does this...

[proudhon]

God, this market has become so incredibly predictable now, and profitably so.  I mean, seriously, the manipulators, if indeed they even exist, have allowed their manipulations to become a very predictable and profitable venture.

hehe. interesting. so you're saying one can profit by selling above $5 and buying below $5? Well, if everyone does this...

Stability!