Topic: Bitcoin ready for a correction (Read 4316 times)

There are those that promote bitcoin as gold2.0 and those that think bitcoin 's store of value alone is not enough.

In China, being considered a "currency" would trigger extremely onerous regulatory requirements for anyone transmitting it.  Bitcoin may have dodged a bullet.  Now, there may be more aggressive action in the future.  I fully expect some bad actors in the BTC field to be prosecuted in China, which takes financial crimes very seriously (look at the QQ fiasco).  However, China has not yet done what it did with virtual currencies, that is, outlaw their use as anything other than currency on virtual worlds.

For instance, if I were that TradeFortress guy and actually in China, as the doxers seem to think, I would be watching my back right now.  The QQ swindler got several years, iirc.

Billing Bitcoin as a currency may not have been a mistake at the beginning, like in 2009-2011, but ever since then it has been. Oh well, more money for the people that get it, like Barry Silbert, Chamath Palihapitiya, and the Winklevoss twins.

Also, I don't recall hearing that people couldn't do trades for goods and services with Bitcoin. It sounded more like they meant Bitcoin should not be considered legal tender, or should not be considered official government currency. Which is pretty much a non-announcement.

Wikipedia:
Bitcoin wiki:

And then comes China and rules that bitcoin should not be used as a currency and you call that an excuse and a small trigger? 

I know that you want to believe that it was your TA that it worked but in this case  things are obvious.
It's from now on that you 'll see if you were right or not.

Very agreed on that, and in fact sold before the China news.  I thought the event was overdue, and while the China news could have set off what was already going to happen, I really think its effect is exaggerated.  Correlation doesn't equal causation, and while there is some tenuous causal connection between the two events, it really just affected the timing.

I think it's probably going to go further down as well, but bought back in anyway because I don't like cutting things close.  I'd rather sacrifice some (potential) profit to avoid risk (and so that I can sleep at night again while the ticker goes berserk instead of waking up like a lunatic to stare at my phone for updates every 10 minutes).

Just came here to quote this post

PenAndPaper: You are not wrong in what you said, Technical analysis is tricky and doesn't always work. I really believe in the double top + MACD-Histogram divergence. I use it to trade options on stocks with high success rates. It is not the double top alone, but a specific set up with more constraints. The MACD-Histogram divergence is very significant and makes this double top a rare thing and that's why I posted it. I don't like to post a lot even though I'm not so new here as you might think from the number of posts I have.
Please note that I posted this chart before the news and before a "proper" double top has formed. A "proper" double top is only confirmed when the right side of the down trend happened and this is shown on the second image I posted here.
Regarding the cause of the downtrend, I believe the news from China is just an excuse or a small trigger. I believe mass behavior is better predicted than individual people's behavior and you can see changes in the general mood in the charts. People were euphoric when I posted the chart and most threads here discussed the exact timing of bitcoin reaching $2000.
Technical analysis is not an exact science, you can not make controlled experiments and you certainly can not repeat them. These are inherent limitations in the social world we live in and trading is a social activity.

oda.krell: I appreciate your support, thank you. On a personal note, even when I see the chart turning bearish I sold only a small part of my account since I still have fiat coming in every month from my business and in the long run I'm extremely bullish about bitcoin. I buy bitcoin on a regular schedule every month and maybe I will increase next month's wire transfer.

I try to stay focused on the large picture and not be caught up in the minute by minute or even hour by hour fluctuations. That is why I look at long term charts. They are the easiest to apply technical analysis to.

MikeyVeez: I took a screenshot of bitcoinwisdom.com and manipulated it to remove all the noise and emphasize what I wanted with some drawings.

Keep up the nice discussion my friends,
Ami

Where do you get such nice charts?

Actually i am like most people around are. Still am i wrong with what i said?

What's wrong Pen? You seem stressed

Op posted a double top and a macd graph and claims that this is a technical analysis that somehow explains the drop while the drop had nothing to do with anything besides the news from china.

I can show you 100000 double tops before the op's one that meant nothing. When you just get lucky you don't go out to forums and brag "look my TA worked" especially when it is so obvious to everyone about what happened.

Hm...


Price was around 1050 at that point (mtgox).

Anyway, I never called an entire group of people "clueless" and that I somehow "take their money". I call people that bullshit about the worthlessness of TA clueless.

If I misunderstood you, and you're just pointing out a particularly weak point in OP's analysis, my apologies. But if you doubt TA as a whole: well, guess what? You probably shouldn't actively trade, since that would gambling, wouldn't it? Buy & Hold is your game then, I guess.

I guess the reason why especially so many newcomers are very aggressive is that they are scared of losing money. They bought at 900+ and are looking at losses now. They flame everyone who gives an honest opinion on what TA currently shows.... a much further drop downwards. Can´t wait for those pigs to get slaughtered once we move further down.

It looks like you are losing your temper so i can only guess how well technical analysis worked for you. Keep it up and take all the money from the clueless people that we are.

Why the aggressiveness? He made a relevant remark about double top and volume. I pointed out that the volume part of his argument wasn't very precise. The market dropped a few days later.

You're free to say "it's just luck, twice a day even a broken clock is right". In other words, you don't believe in TA. In other words, you're clueless and probably shouldn't trade. (go to lucif's thread to get a taste of what someone with actual intuition *and* technical knowledge can do).

Are you for real? What technical analysis? The double top that happened like 10000000 times during the rally from 100 to 1000+?
 It was the news from china that caused the crash.

jamesc760: Ha ha, they say - "Don't feed the trolls"...

oda.krell - I did sell, but a small portion of my holdings, the majority is in a paper wallet and I plan to keep it in paper for a few years. I will buy back soon. I add fiat on a monthly basis and I won't rush my schedule because of this crash. It might not go up too fast.

Usually I spot these events in high volume / high quality stocks but on weekly candlesticks. The pace of events in BTC is faster, that's why I look at daily candles. I know many look at 1 minute candles but that's too myopic for my taste.

Of course he mad, he bought in st 1250 and panic sold thrm all at 600!

Jup. Credit where credit is due. Good call OP.

Did you get out at around 1200? I didn't, took me til around 1000 (bitstamp) before I decided we're stalling and sold a substantial portion of btc (with the goal of rebuying lower)