Wouldn't it be nice... (the LazyWhale algorithm)

[BldSwtTrs]

Possible suggestion #5

Our brain is the original neural network. More data for training (usually) means better results of the trained network. Legendary members simply had the most exposure to market behavior over time, hence more training than the rest of us.

How is this different from #2?

Is knowledge something else than an efficient configuration of neurons?

[oda.krell]

Possible suggestion #5

Our brain is the original neural network. More data for training (usually) means better results of the trained network. Legendary members simply had the most exposure to market behavior over time, hence more training than the rest of us.

How is this different from #2?

Is knowledge something else than an efficient configuration of neurons?

Can be seen the same, I guess. 'Knowledge' and 'BSc' usually implies you put in hard work, maybe even a spark of talent being present. I was more thinking of the pure 'exposure over a long time' aspect, but maybe that's what wary had in mind as well.

[BldSwtTrs]

Possible suggestion #5

Our brain is the original neural network. More data for training (usually) means better results of the trained network. Legendary members simply had the most exposure to market behavior over time, hence more training than the rest of us.

How is this different from #2?

Is knowledge something else than an efficient configuration of neurons?

Can be seen the same, I guess. 'Knowledge' and 'BSc' usually implies you put in hard work, maybe even a spark of talent being present. I was more thinking of the pure 'exposure over a long time' aspect, but maybe that's what wary had in mind as well.

It's interesting. I guess we could say that the difference could be that #2 is a process of conscious acquisition of knowledge and #5 a process of unconscious acquisition of a knowledge.
And at the end of these process though, it's probable knowledge end up being unconscious in both cases.

[mmitech]

I still think that there is a good chance that we are heading slowly to double digits... and I wont buy a single Bitcoin before that, I wont regret my decision if I "miss" the train, simply because if Bitcoin will succeed and become widely used then it really doesn't matter when will you buy, in fact it will be even better safer and more profitable to buy later when there is a clear picture about its use.

[NotHatinJustTrollin]

I still think that Bitcoin will hit double digits, it will be just slow and painful path for many of you here, I will ride the ship only when most of you delusional cultists and get rich kids abandon it....

I still think that there is a good chance that we are heading slowly to double digits... and I wont buy a single Bitcoin before that, I wont regret my decision if I "miss" the train, simply because if Bitcoin will succeed and become widely used then it really doesn't matter when will you buy, in fact it will be even better safer and more profitable to buy later when there is a clear picture about its use.

Mmmh.

So you are talking about "delusional greedy kids" wanting to get rich quick buying now, but you wanna do the same and "catch the train", only lower.


You are no different from the delusional bulls you are currently laughing at, mate.

[mmitech]

I still think that Bitcoin will hit double digits, it will be just slow and painful path for many of you here, I will ride the ship only when most of you delusional cultists and get rich kids abandon it....

I still think that there is a good chance that we are heading slowly to double digits... and I wont buy a single Bitcoin before that, I wont regret my decision if I "miss" the train, simply because if Bitcoin will succeed and become widely used then it really doesn't matter when will you buy, in fact it will be even better safer and more profitable to buy later when there is a clear picture about its use.

Mmmh.

So you are talking about "delusional greedy kids" wanting to get rich quick buying now, but you wanna do the same and "catch the train", only lower.


You are no different from the delusional bulls you are currently laughing at, mate.

Yes, I am different.

[inca]

I still think that Bitcoin will hit double digits, it will be just slow and painful path for many of you here, I will ride the ship only when most of you delusional cultists and get rich kids abandon it....

I still think that there is a good chance that we are heading slowly to double digits... and I wont buy a single Bitcoin before that, I wont regret my decision if I "miss" the train, simply because if Bitcoin will succeed and become widely used then it really doesn't matter when will you buy, in fact it will be even better safer and more profitable to buy later when there is a clear picture about its use.

Mmmh.

So you are talking about "delusional greedy kids" wanting to get rich quick buying now, but you wanna do the same and "catch the train", only lower.


You are no different from the delusional bulls you are currently laughing at, mate.

Yes, I am different.

Unemployed and more bitter?

[mmitech]

I still think that Bitcoin will hit double digits, it will be just slow and painful path for many of you here, I will ride the ship only when most of you delusional cultists and get rich kids abandon it....

I still think that there is a good chance that we are heading slowly to double digits... and I wont buy a single Bitcoin before that, I wont regret my decision if I "miss" the train, simply because if Bitcoin will succeed and become widely used then it really doesn't matter when will you buy, in fact it will be even better safer and more profitable to buy later when there is a clear picture about its use.

Mmmh.

So you are talking about "delusional greedy kids" wanting to get rich quick buying now, but you wanna do the same and "catch the train", only lower.


You are no different from the delusional bulls you are currently laughing at, mate.

Yes, I am different.

Unemployed and more bitter?

everything going as planned so far...soon I will be almost 1 year home, I must say that it was the best year so far, achieved many things that would take years if I worked in a big boring corporate like the one I used to work for, again thanks to Bitcoin and the wise decisions I took... some us knew when to take profits


now back to topic.

[pa]

This is one of the observations I made during the last year that is still puzzling me. Many of the "old hands" (let's say, registration 2012 and before) seem to have a very keen nose for the market state in general terms.

I'm not talking about the most general intuition, the 'in retrospect, any price turns out to be a good price per coin on a long enough horizon' idea. I share that one, but it's more of a shared hope we have here, but it hasn't been tested that much yet.

I mean a more specific one: the one where the legendary (previously: hero) members have a pretty good feel for when the market is about to turn, both towards 'hopeless, prepare for a serious correction' but also at the other end, 'don't expect that much panic anymore'. It's not universally shared among that class of members of course (some are almost always too bullish, some almost always too bearish), but a good number of the old members that I follow seem to be able to get a rough reading on what the state of the market is.

No deeper insight I can offer. Just something I believe to have noticed.

Possible explanations:

1. The key is brains. Early accepters are smarter, in general. To invent bitcoin you have to be very very smart, to understand and appreciate you have to be very smart, and so on.
2. The key is knowledge. For the 4 years of trading they've became B.Sc of trading.
3. The key is managing your emotions. For 4 years they got enough emotional experience to be able to control them.
4. The key is natural talent. 4 years of natural selection took ones with it. The rest is broken or just left the forum.

Well. Heaps of versions and no idea which one to chose. Just like with trading. There always a lot of plausible theories about why the price must go up and lot - about why it must go down. And I always choose wrong one  

Re: #1, it would be interesting to administer an IQ test to all bitcointalk participants and correlate with date of account registration. Or, does anyone know of a script to estimate IQ from forum posts?

[Ibian]

This is one of the observations I made during the last year that is still puzzling me. Many of the "old hands" (let's say, registration 2012 and before) seem to have a very keen nose for the market state in general terms.

I'm not talking about the most general intuition, the 'in retrospect, any price turns out to be a good price per coin on a long enough horizon' idea. I share that one, but it's more of a shared hope we have here, but it hasn't been tested that much yet.

I mean a more specific one: the one where the legendary (previously: hero) members have a pretty good feel for when the market is about to turn, both towards 'hopeless, prepare for a serious correction' but also at the other end, 'don't expect that much panic anymore'. It's not universally shared among that class of members of course (some are almost always too bullish, some almost always too bearish), but a good number of the old members that I follow seem to be able to get a rough reading on what the state of the market is.

No deeper insight I can offer. Just something I believe to have noticed.

Possible explanations:

1. The key is brains. Early accepters are smarter, in general. To invent bitcoin you have to be very very smart, to understand and appreciate you have to be very smart, and so on.
2. The key is knowledge. For the 4 years of trading they've became B.Sc of trading.
3. The key is managing your emotions. For 4 years they got enough emotional experience to be able to control them.
4. The key is natural talent. 4 years of natural selection took ones with it. The rest is broken or just left the forum.

Well. Heaps of versions and no idea which one to chose. Just like with trading. There always a lot of plausible theories about why the price must go up and lot - about why it must go down. And I always choose wrong one  

Re: #1, it would be interesting to administer an IQ test to all bitcointalk participants and correlate with date of account registration. Or, does anyone know of a script to estimate IQ from forum posts?

No such thing exists, and you should probably be glad about that.

[piramida]

I still think that there is a good chance that we are heading slowly to double digits...

Very soon we will be retesting the long term exponential trend line, which crosses $300 somewhere around start of February. If we stay below 300 in Feb, then yeah, all bets are off and anything can happen, even maybe double digits (although you'd have to have balls of steel to buy bitcoin at double digits in 2015 - it would surely mean at least 10-year long depression of price or even total loss of faith in recovery).

However, as something much more realistic, I'd predict a strong rebound off that support in the end of January, as it happened three times already (in 2011, 2012 and 2013)

[sgbett]

This is one of the observations I made during the last year that is still puzzling me. Many of the "old hands" (let's say, registration 2012 and before) seem to have a very keen nose for the market state in general terms.

I'm not talking about the most general intuition, the 'in retrospect, any price turns out to be a good price per coin on a long enough horizon' idea. I share that one, but it's more of a shared hope we have here, but it hasn't been tested that much yet.

I mean a more specific one: the one where the legendary (previously: hero) members have a pretty good feel for when the market is about to turn, both towards 'hopeless, prepare for a serious correction' but also at the other end, 'don't expect that much panic anymore'. It's not universally shared among that class of members of course (some are almost always too bullish, some almost always too bearish), but a good number of the old members that I follow seem to be able to get a rough reading on what the state of the market is.

No deeper insight I can offer. Just something I believe to have noticed.

Possible explanations:

1. The key is brains. Early accepters are smarter, in general. To invent bitcoin you have to be very very smart, to understand and appreciate you have to be very smart, and so on.
2. The key is knowledge. For the 4 years of trading they've became B.Sc of trading.
3. The key is managing your emotions. For 4 years they got enough emotional experience to be able to control them.
4. The key is natural talent. 4 years of natural selection took ones with it. The rest is broken or just left the forum.

Well. Heaps of versions and no idea which one to chose. Just like with trading. There always a lot of plausible theories about why the price must go up and lot - about why it must go down. And I always choose wrong one  

Re: #1, it would be interesting to administer an IQ test to all bitcointalk participants and correlate with date of account registration. Or, does anyone know of a script to estimate IQ from forum posts?

No such thing exists, and you should probably be glad about that.

2015 is looking like the year that nematode registration goes through the roof!

[oda.krell]

Guys! Back on topic please!!! 

We're here to discuss black box, underperforming trading algorithms with stupid names, not nematode registration.

"nematode registration"... *snort*

[pa]

What kind of signals have you been getting from your LazyWhale algorithm?

[sgbett]

I second that... if its flipped again and says "buy now" then I think its on to a winner

[oda.krell]

Easy on the Hopium, guys

I relaxed the conditions of the algorithm a bit to get slightly more signals overall to counter the sparsity of trades problem that was rightfully pointed out by Ryn and Lambchop among others - but even then, no change in signals yet. Still says 'USD', from the previous 300s signal, (EDIT) with no signals in between.

[sgbett]

That indicator be one tough mistress.

[RyNinDaCleM]

Easy on the Hopium, guys

I relaxed the conditions of the algorithm a bit to get slightly more signals overall to counter the sparsity of trades problem that was rightfully pointed out by Ryn and Lambchop among others - but even then, no change in signals yet. Still says 'USD', from the previous 300s signal, (EDIT) with no signals in between.

Well, it got the short side right. 
I'm sure this will be like any indicator, "Holy Grail" indicators included. When it's good, it's great but it can't always be good either. There are too many possibilities in market actions/patterns to account for them all. So it's to be expected to have some bad signals. I'm sure you will find what ye seek

[oda.krell]

Easy on the Hopium, guys

I relaxed the conditions of the algorithm a bit to get slightly more signals overall to counter the sparsity of trades problem that was rightfully pointed out by Ryn and Lambchop among others - but even then, no change in signals yet. Still says 'USD', from the previous 300s signal, (EDIT) with no signals in between.

Well, it got the short side right.  
I'm sure this will be like any indicator, "Holy Grail" indicators included. When it's good, it's great but it can't always be good either. There are too many possibilities in market actions/patterns to account for them all. So it's to be expected to have some bad signals. I'm sure you will find what ye seek

Completely agreed on the second line... original post (on page 1) is kind of cringeworthy when I re-read it now (but I left it unchanged ). Very much "I have found the holy grail" style post...

I am however getting a clearer idea of what I'm actually doing with my signal combination. There always seems to be some trade-off between trading styles, and another way to look at the signal I am aiming for can maybe be summarized as follows: "During bear markets, stay approximately USD neutral. During bull markets, aim for maximal USD profits."

It's not encoded like that of course, but I think that's essentially what I'm looking for. In principle, if BTC would enter a 20 bear year market, trades based on the signal could well be losing USD value as well (just at a much slower rate than market, ideally). It is after all based on the premise that, eventually, there will be another BTC bull market (and as such is unsuited for the most hardened bears crypto skeptics trolls Notlambchop )

[oda.krell]

Alright. Initially, when people asked how the algorithm works internally, I refused to specify it any further. Now that nobody cares anymore, here's the basic idea ^_^

Note: I'm not going to fill in the exact numerical parameters of the the technical/indicator signals. No need to encourage frontrunning. But in principle, with the details I'm about to give, you could find your own (and probably very similar) parameters by training the individual parts over the market data that is the same for everyone.

The trade signals of this algorithm are a complex condition based on three technical signals.

Signal #1, the "main" signal, is a medium term momentum signal. Think "daily EMA20+10 crossover", but the average I use is instead a Hull type average (and the parameters are obviously not 20/10).

Important to note here: signal #1 is symmetric wrt 'buy' and 'sell'.

If used alone, signal #1 is profitable over the global bitcoin history (GX, BS, BF), and roughly uniformly profitable as well. However, it yields slightly too many trades, and tends to sell too early during major rallies. So, it is not the desired signal yet that only sells when it really has to.

Signal #2 is a short-term momentum signal. It acts as a filter applied to #1. Think of it as an "optimal entry/exit" filter. It cannot initiate additional trades by itself, it can only delay a trade based on signal #1. It is basically capturing the idea: if the medium term is up, but the short term is drastically down, better wait a bit before you buy (similar for delaying a sell trade). Signal #2 is buy/sell symmetric as well, and I don't really think it is problematic (also, leaving it out doesn't change the results from a pure signal #1 strategy much).

Signal #3 is the tricky one. You could call it the "bubble filter". Just like #2, it doesn't do anything other than (possibly) delay signals coming from #1, i.e. it doesn't add to the total number of trade signals but only *reduces* them under certain conditions.

It defines certain market conditions (think: long term momentum) to be so strongly bullish that a mid-term momentum signal from #1 that says 'sell' should be ignored for the moment, until either the mid term is up again, or the market condition becomes less bullish, in which case the 'sell' goes through.

And here's the tricky bit. Signal #3 is not buy/sell symmetric. It only delays 'sell' trades, but not 'buy' trades, in case the long term momentum is flipped around

I know. That buy/sell asymmetry is a big violation of all that is holy in algorithmic trading. Reeks of overfitting.

Still, given the history of the Bitcoin market so far, I can see some justification for it. It works well for 2011, 2012, 2013. In 2014, it still works well enough for the first half, but from then on, it's not really justified anymore.

I guess it all depends now if Bitcoin will ever go through a significant bull market again, and when. Let's say it does ("Bitcoin is dead" users need not reply :D). That still doesn't mean that the exact parameters of the "bubble filter" are optimal, but it's probably not going to be the millstone around the algorithms neck that it is right now, delaying sell signals when it really shouldn't.

In a way, I'm making a human choice for my algorithmic method here: the assumption, that in the long run, it is better to err on the side of buying than on the side of selling - a choice that is justified by the global history of the market, but not by the more local one.

Comments welcome.