[SHARE] Your Personal Analysis (only post with pictures)

[Spekulatius]

My analysis of the recent ongoings in the whole Pirate affair (Chaang Noi declaring Pirate has defaulted, among other events):
https://bitcointalk.org/index.php?topic=98420.msg1120644#msg1120644

,his chat logs on #btcst on freenode:

Code:

Quote from: smoothie on August 21, 2012, 08:54:09 PM
Quote
[10:44] <@pirateat40> Anduck, I really thought this initial process would happen faster than it has. Sad
[10:44] <Anduck> pirateat40: what's causing the delay?
[10:46] <@pirateat40> Anduck, the price movements.
[10:46] <Anduck> pirateat40: u been selling or buying`
[10:47] <@pirateat40> Anduck, just blocking buys and selling the coins out of the system.

among others; and the evidence linking him to 1DkyBEKt5S2GDtv7aQw6rQepAvnsRyHoYM:
https://bitcointalk.org/index.php?topic=94675.0

which suggests a total capital of 500k BTC leads me to the conclusion that the conspicious stepping of ASKs, clearly to see in the above picture, was lined up by him (Pirateat40) in order to sell ~100k BTC on the way up to 12.50$. With that kind of leverage and a distribution of 1:4 in BTC:USD in his portfolio, he can drive the resulting counter move back down to vast lows, using the ~110k USD aquired on the way up to buy cheap and plentyful.

If his strategy works out:
Expect rollercoaster ride to 12$ and back down below current levels in the coming days!

[Chalkbot]

Why is he trying to sell? Isn't he supposed to pay back in BTC?

If it was a bear raid, wouldn't he sell at market prices?

[Spekulatius]

Why is he trying to sell? Isn't he supposed to pay back in BTC?

Because he seems to have only BTC in his pocket, no USD yet. In order to buy more BTC he needs sufficient USD first.

If it was a bear raid, wouldn't he sell at market prices?

Selling at market prices without any lenders payed back (therefore no change of fundamentals) bares the risk of a quick momentum change to his disadvantage especially with vigilant traders we have right now, that are alerted by the last days crash only waiting to buy cheap coins. Only selling at market prices would be too obvious.
I can understand his fear that he could end up not buying sufficient amounts of BTC before the momentum turns around against him. A safer bet seems to be to sell BTC he already has on the rally resulting from more and more rumors of his default. Yesterday and today we saw the price on hold. From a TA point of view, we were due for a correcting rally. That rally hasnt happened yet, because of uncertainty, whether or whether not Pirate will pay back maybe with little delay or not at all. The more time passes by without him paying the more confidence grows that there will be no payback, hence no downward pressure.

[10:44] <@pirateat40> Anduck, I really thought this initial process would happen faster than it has. Sad
[10:44] <Anduck> pirateat40: what's causing the delay?
[10:46] <@pirateat40> Anduck, the price movements.
[10:46] <Anduck> pirateat40: u been selling or buying`
[10:47] <@pirateat40> Anduck, just blocking buys and selling the coins out of the system.

This 4 step strategy could have been his plan all along:
1. Announce closure -> price drop
2. "default" -> price rise (Pirate sells BTC on the way up)
3. flash crash -> Pirate buys more BTC towards the bottom
4. Final payback with sufficient amounts of BTC or Escape to Jamaica

[augustocroppo]

BTC/USD Mt.Gox - 13/08/2012 to 23/08/2012

http://bitcoincharts.com/charts/mtgoxUSD#rg10zigHourlyzczsg2012-08-13zeg2012-08-23ztgCzm1g10zm2g25zxzi1gAccDistzcv



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[augustocroppo]

ADL versus OBV

The Accumulation Distribution Line and On Balance Volume (OBV) are cumulative volume-based indicators that sometimes move in opposite directions because their basic formulas are different. (...) This line can then be compared with the price chart of the underlying security to look for divergences or confirmation.

http://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:accumulation_distrib#adl_versus_obv

BTC/USD Mt.Gox - 22/08/2012

http://bitcoincharts.com/charts/mtgoxUSD#rg1zig15-minzczsg2012-08-23zeg2012-08-23ztgCzm1g10zm2g25zxzi1gAccDistzi2gOBVzcv



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[owdbetts]

@Spekulatius

I'm not sure I buy your 4 step strategy

1. Announce closure -> price drop
2. "default" -> price rise (Pirate sells BTC on the way up)

I'm guessing that your logic is that the price drop (1) was because the market assumed:

 a. BST was genuine
 b. BST remained solvent despite being shut down, and the funds would be returned
 c. That a large proportion of the invested funds would be sold for fiat, rather than held or invested in BTC

Now, I'm not sure it's clear that the market as a whole held any of these views predominently, but I'm assuming your argument is that they did, and that as people began to doubt (b) and hence start to doubt (c) this should spark a rally (2)

Is that about it?

I would expect the crash to be due, in part, to the reduction of the inflows of cash buying BTC to invest in BST and PPTs
and indeed HYIPs in general.  I would expect that far from triggering a rally, any default by BST would increase concerns about the safety of BTC invested in HYIPs, further reducing these cash inflows and reducing the chances they will recover.  Granted, this might cause outflows from some of the other HYIPs, but that won't last long as the other Ponzis will in turn fall like a pack of cards.

[Killerpotleaf]

[Spekulatius]

@Spekulatius

I'm not sure I buy your 4 step strategy

1. Announce closure -> price drop
2. "default" -> price rise (Pirate sells BTC on the way up)

I'm guessing that your logic is that the price drop (1) was because the market assumed:

 a. BST was genuine
 b. BST remained solvent despite being shut down, and the funds would be returned
 c. That a large proportion of the invested funds would be sold for fiat, rather than held or invested in BTC

Now, I'm not sure it's clear that the market as a whole held any of these views predominently, but I'm assuming your argument is that they did, and that as people began to doubt (b) and hence start to doubt (c) this should spark a rally (2)

Is that about it?

Correct. Add to that some new unexperienced traders since the last bubble and a grain of herd mentality and we are good.

I would expect the crash to be due, in part, to the reduction of the inflows of cash buying BTC to invest in BST and PPTs
and indeed HYIPs in general.

I think you are wrong here, at least short term. See this graph, the MtGox order book is packed to the rafters, as much as never since July 2011:

  I would expect that far from triggering a rally, any default by BST would increase concerns about the safety of BTC invested in HYIPs, further reducing these cash inflows and reducing the chances they will recover.  Granted, this might cause outflows from some of the other HYIPs, but that won't last long as the other Ponzis will in turn fall like a pack of cards.

Like I said, false in short term. Maybe true in long term.

I would still argue that a new rally is due to about 12$ or wherever Pirate lets us ascent to.

I am bullish because:
- the more time passes without a payback, the more the recent drop seems unjustified
- the more time passes, the more confidence grows in the underlying uptrend with all the good news happening (BitInstant Debit Card, Satoshi Client probably becoming light wight soon, "BIG" announcement in September,..)
- the 7% dividends payed weekly from BS&T actually dont increase supply anymore (because there are gone)
- if price remains at current levels or rises, traders laying in wait for a price drop grow increasingly impatient and will eventually buy
- Bitcoin conference coming up (always bolsters traders confidence and fantasy)

This will only hold true if:
- Dividends will further be withheld
- Pirate remains patient
- No major news comes in that is suitable to cause a crash (like MtGox gets seriously hacked or something of that magnitude)

If Pirate for whatever reason does not want to wait for an uptrend to happen, maybe because he wants to meet that end of week deadline at all costs, he will probably induce a crash by selling at market prices. This way a crash is certain if he can sell alot and keep frightening walls up. This should be his last resort however, because reasons described in my above post:

If it was a bear raid, wouldn't he sell at market prices?

Selling at market prices without any lenders payed back (therefore no change of fundamentals) bares the risk of a quick momentum change to his disadvantage especially with vigilant traders we have right now, that are alerted by the last days crash only waiting to buy cheap coins. Only selling at market prices would be too obvious.
I can understand his fear that he could end up not buying sufficient amounts of BTC before the momentum turns around against him. A safer bet seems to be to sell BTC he already has on the rally resulting from more and more rumors of his default. Yesterday and today we saw the price on hold. From a TA point of view, we were due for a correcting rally. That rally hasnt happened yet, because of uncertainty, whether or whether not Pirate will pay back maybe with little delay or not at all. The more time passes by without him paying the more confidence grows that there will be no payback, hence no downward pressure.

[augustocroppo]

bull trap

Could you explain why that is a bull trap and how the actual data proves that are buyers with bad investments?

[The-Real-Link]

Good points, Spec.  It clarifies things though we can all just wait and see.  I think tomorrow will be an important and decissive day for this whole ordeal.

Oh and because the thread asked:

[Killerpotleaf]

bull trap

Could you explain why that is a bull trap and how the actual data proves that are buyers with bad investments?

no, their is 0 data that can really prove anything. if their was ... well then it would be to easy wouldn't it?

all I'm saying is the rise that fallowed the dump was First, people buying into opportunity (8$ bitcoins Fiinaly! buy buy buy! says the new guy), and then people buying back. ( omg its going back up, quick take the bitcoin profits! )

dose it sound like the crisis is over ?

[Spekulatius]

Oh and because the thread asked:

[muyuu]

I've been noticing the British market thicker in the bid side lately than others.

[augustocroppo]

no, their is 0 data that can really prove anything. if their was ... well then it would be to easy wouldn't it?

all I'm saying is the rise that fallowed the dump was First, people buying into opportunity (8$ bitcoins Fiinaly! buy buy buy! says the new guy), and then people buying back. ( omg its going back up, quick take the bitcoin profits! )

dose it sound like the crisis is over ?

I think not yet.

Anyway, I asked because I learned that bull trap is a sign which indicates the trend will reverse, consequently attracting short-term investors to pump-and-dump. However, since the sign is a trap, the reversing does not happen, leaving the investors trapped with the securities.

So, if that is the case, the investors you describe are not trapped, except if they expect to sell BTC for US$ 15 in the near future...

OBS: Your graph is data, I just asked for more data representation to understand your hypothesis.

[Spekulatius]

no, their is 0 data that can really prove anything. if their was ... well then it would be to easy wouldn't it?

all I'm saying is the rise that fallowed the dump was First, people buying into opportunity (8$ bitcoins Fiinaly! buy buy buy! says the new guy), and then people buying back. ( omg its going back up, quick take the bitcoin profits! )

dose it sound like the crisis is over ?

I think not yet.

Anyway, I asked because I learned that bull trap is a sign which indicates the trend will reverse, consequently attracting short-term investors to pump-and-dump. However, since the sign is a trap, the reversing does not happen, leaving the investors trapped with the securities.

So, if that is the case, the investors you describe are not trapped, except if they expect to sell BTC for US$ 15 in the near future...

OBS: Your graph is data, I just asked for more data representation to understand your hypothesis.

A "bull trap" is a trap for bullish traders. It looks like trend will go up, so bull flock to the opportunity but in fact soon after the trend returns to its downtrend, leaving the bulls with their shitty long positions.

[augustocroppo]

A "bull trap" is a trap for bullish traders. It looks like trend will go up, so bull flock to the opportunity but in fact soon after the trend returns to its downtrend, leaving the bulls with their shitty long positions.

If so, regarding the case presented above, bullish traders looking to profit from BTC or USD?

[Spekulatius]

A "bull trap" is a trap for bullish traders. It looks like trend will go up, so bull flock to the opportunity but in fact soon after the trend returns to its downtrend, leaving the bulls with their shitty long positions.

If so, regarding the case presented above, bullish traders looking to profit from BTC or USD?

Bulls look to profit from BTC going up in price, but instead she heads further down.

[augustocroppo]

High volume of transactions across the network with a high value per transaction.

Investors, consumers and merchants moving funds for the weekend sell-off.

Sell-Off

The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the value of the security.

Read more: http://www.investopedia.com/terms/s/sell-off.asp

Aug 25, 2012 00:00:05 (UTC)
   

Code:

Expected Bitcoins		21000000
	
Produced Bitcoins		9777050
Transactions last 24h		32275
Transactions avg. per hour	1344.79
Bitcoins sent last 24h		11064106.02
Bitcoins sent avg. per hour	461004.42
	
Bitcoin reserve			11222950

http://bitcoincharts.com/bitcoin/



Uploaded with ImageShack.us

[Spekulatius]

Sell-Off

The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the value of the security.

Read more: http://www.investopedia.com/terms/s/sell-off.asp

You gotta stop those quotes. Seriously.

[augustocroppo]

Sell-Off

The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the value of the security.

Read more: http://www.investopedia.com/terms/s/sell-off.asp

You gotta stop those quotes. Seriously.

What is the issue with my references?