This BTC bear market is very similar to the 2011 BTC bear market

[Wandererfromthenorth]

Some traders have tried to compare the current BTC bear market to the 2013 BTC bear market (the downtrend from the peak of the first 2013 bubble at $250) in the past. Turns out that the 2014 bear market looks nothing like the 2013 bear market, as I think everybody realised by now.

In fact, I am arguing that this current bear market played out very similarly to the 2011 bear market (after the peak of the bubble at $32). A time when BTC could only be traded at MtGox.


Here are the pics:
















I am not saying BTC will double bottom at $275 and it will be up from there nor that the bear market is over.
I am just pointing out striking similarities between the two bear markets. For all I know we could break the current bottom.
I leave the conclusions to you.
The time frames are different and the 2011 bear market went progressively lower each time, but the moves are the same.


What do you think? Can the two bear markets be considered similar? Not at all? Does that imply something?

[brg444]

or maybe it is similar to the 2014 bear market 


these comparisons are asinine. the dynamics and structure of the Bitcoin ecosystem are so entirely different from 2011 there is no way you can compare it to the present situation

[coinableS]

Good catch! I agree they looking very similar. We can only hope they have similar end results 

[ElectricMucus]

The 2011 bear market began after the golden age of GPU mining, the 2014 bear began after the golden age of ASIC mining.

The bottom happened about the same time as the electric cost exceeded the trade value, the period was quite brief. In order for that to happen at current difficulty price would have to tank to ~100-120.

[var53]

The 2011 bear market double bottomed after six months, then went up. However, the 2014 bear market kept going down for ten months until October,so it's not quite the same.

[Tzupy]

Nothing new, I have the same opinion, except that the seller pressure is now much lower than in 2011, and IMO that's why it takes so much longer.
My guesstimate of the corresponding position in the 2011 bear market is about the 22nd September (but back then the EW were more distorted).
Here are the charts from October until 2015 January 30th (but it may last longer than that) and 2011 last part of wave C.
The indicators are shown in times frames that allow easy identification of the EW sub-sub-waves.

[Dalmar]

The 2011 bear market double bottomed after six months, then went up. However, the 2014 bear market kept going down for ten months until October,so it's not quite the same.

The market was much smaller back then. Hence, why it crashed much faster. Larger markets generally take longer to find a bottom. Just look at the pace BTC crashes vs gold/silver.

[Wandererfromthenorth]

The 2011 bear market double bottomed after six months, then went up. However, the 2014 bear market kept going down for ten months until October,so it's not quite the same.

Yes, as I said, they are different in this respect, but the shapes are the same. They are fractals.

The time frames are different and the 2011 bear market went progressively lower each time, but the moves are the same.

[var53]

The 2011 bear market double bottomed after six months, then went up. However, the 2014 bear market kept going down for ten months until October,so it's not quite the same.

Yes, as I said, they are different in this respect, but the shapes are the same. They are fractals.

The time frames are different and the 2011 bear market went progressively lower each time, but the moves are the same.

It's possible that news of the auction could push the price down to a double bottom. If that happened the moves would be the same, but we'll have to wait to find out.

[Wandererfromthenorth]

Nothing new, I have the same opinion, except that the seller pressure is now much lower than in 2011, and IMO that's why it takes so much longer.
My guesstimate of the corresponding position in the 2011 bear market is about the 22nd September (but back then the EW were more distorted).
Here are the charts from October until 2015 January 30th (but it may last longer than that) and 2011 last part of wave C.
The indicators are shown in times frames that allow easy identification of the EW sub-sub-waves.

Interesting.
Yes in fact it would be perfectly possible that the price right now is in the equivalent of the 22nd September in 2011...

[Wandererfromthenorth]

The 2011 bear market began after the golden age of GPU mining, the 2014 bear began after the golden age of ASIC mining.

The bottom happened about the same time as the electric cost exceeded the trade value, the period was quite brief. In order for that to happen at current difficulty price would have to tank to ~100-120.

Interesting too, but are you sure it's at 100-200? I am not an expert in this but I've heard some folks talk about the low 300s high 200s as the underwater point.

[ElectricMucus]

The 2011 bear market began after the golden age of GPU mining, the 2014 bear began after the golden age of ASIC mining.

The bottom happened about the same time as the electric cost exceeded the trade value, the period was quite brief. In order for that to happen at current difficulty price would have to tank to ~100-120.

Interesting too, but are you sure it's at 100-200? I am not an expert in this but I've heard some folks talk about the low 300s high 200s as the underwater point.

It depends on whenever you have a recent miner or cheap electricity. IIRC at the $2 bottom electricity costs exceeded trading costs even with fairly cheap electricity ($0.1 per kW/h) and a recent GPU. To determine that I used the Bitcoinwisdom calculator with 0% difficulty increase and tweaked the price till about every ROI was at infinity.
It may be lower still because the calculator should take the block reward reduction into account but it's just a ballpark figure anyway.

Where I live I would already be underwater for most ASICs (I pay  €0.2 per kW/h).

Reversal at that point makes even sense from a supply demand perspective: People who are looking for the cheapest way to obtain as many Bitcoins as possible are mining most of the time and once it's not longer the cheapest way they should rationally resort to buying. The thesis is that this makes a significant difference because they are new market participants at that point.

[Joe200]

This bear market is by far the longest one so far. Not like 2011 or any others.

https://bitcointalk.org/index.php?topic=676333.0

[spiderbrain]

Nice analysis, we may get a double bottom, especially after the latest US marshal auction announcement. However, there are much larger forces operating off the exchanges now than before, which will likely reduce the similarities. 

[DieJohnny]

I feel this is a great match frankly.... but while we are months longer than the 2011 bubble already, we are really only about 2/3 through the cycle.

from your chart we go down to $125 in the next three months. Then trickle back up to $300 before moving on from this malaise.

I think we are 9 months from true uptick. October 2015 we break $500 again, Dec 2015 we break $1000.

[Wary]

Really interesting. Thanks!

[SmoothCurves]

I feel this is a great match frankly.... but while we are months longer than the 2011 bubble already, we are really only about 2/3 through the cycle.

from your chart we go down to $125 in the next three months. Then trickle back up to $300 before moving on from this malaise.

I think we are 9 months from true uptick. October 2015 we break $500 again, Dec 2015 we break $1000.

I'm thinking roughly the same. May 2015 we break $500, we break $1000 in Sept and we rally to a new ATH around Jan 2016

[RyNinDaCleM]

In 2011 the market was indeed much smaller. This leads to much more volatility and faster progression through cycles. Also when you consider that with the reluctance to sell (likely due to dreams of bubble after bubble on the road to riches) this makes for a much slower progression this time around.
In 2011 it was also much more risky because the future of Bitcoin was uncertain (still is, but not like it was back then), and people were a lot more willing to offload on a whim. Also there were a lot more highly emotional/panicky traders (nearly all of them). This adds to the volatility and the speed in which corrections complete.

Aside from that, the two corrections are following a very similar path and the 4th wave of a cycle tends to be twice as long (or longer) as the 2nd wave. The bear market that led from $31.9099 to $1.994 was the wave-2 of the same degree as this correction where this correction is likely wave-4.

The only other option is that this correction is one degree larger than the one from 2011, in which case it will be even longer than the scenario I laid out above, but is in agreement with EM's reply about cost of mining/possible bottom price and it also explains why they are so similar. After all, the guide line of variation says that if 2 is steep, 4 will be sideways. But if this correction follows a similar path then it may not be of the same degree. This would agree with lucs' "historical 2" statement.

[gog1]

Nice analysis, we may get a double bottom, especially after the latest US marshal auction announcement. However, there are much larger forces operating off the exchanges now than before, which will likely reduce the similarities. 

While BTC proves that it can survive the auction; at the same time, whale that wants to get in will try their luck with the auction.  This will probably depress the prices for the next 2 weeks as fund are drying.

[Eisenhower34]

The 2011 bear market began after the golden age of GPU mining, the 2014 bear began after the golden age of ASIC mining.

The bottom happened about the same time as the electric cost exceeded the trade value, the period was quite brief. In order for that to happen at current difficulty price would have to tank to ~100-120.

That would represent a roughly 75% drop from current prices and roughly a 90% drop from the 2013 peak prices. Although it would certainly not be "fun" for most bitcoin hodlers it would not be unheard of for the price to fall that much temporarily