Topic: Investor Cycles of Emotion, Ignorance (Read 2615 times)

Currently trapped amongst some very strong contours. Consecutive high volume candles on weekly scale, second with larger volume only 5 full days in = plausible medium term bottom. This also suggested by location of price within channel. Next target low $400s.

Who knows where we are at 

It's just a counter opinion to those that repeatedly post the bubble chart, from instructing that maybe there is an alternative scenario they have overlooked.

Not for there sakes but for anyone else who might be in the business of coming to their own conclusions

Are we at the bottom in this cycle?  Have we seen capitulation?  Does the high volume today signal capitulation?

What was unusual in the current down turn is that good news didn't increase the price, it just kept going down.  

I think once the Chinese got a mechanism to short Bitcoin (via OKcoin) then they've manipulated the price down to its current levels.

The Chinese at present handle the majority of trades for Bitcoin, furthermore they have no use for Bitcoin other than speculation and mining.    So what's happening is the Chinese are selling futures of Bitcoin at deflated prices.    My worry though is whether OKcoin correctly tracks the Bitcoin that have been shorted.

Any massive increase in the price of Bitcoin can send many shorters into Bankruptcy.

I think you need to consider that there are more than one market here.

There's currently the Chinese market which incidentally has the majority of the trading volume.

Looking at the current 300 price, it appears that most players in the Chinese market are underwater.

Unless of course you don't consider those players at OKCoin who have been shorting the market since August 7th.

I predict the next bull market run for Bitcoin will be much larger than the previous one, simply because of the prevalence of short sellers in the market.   These players not only provide a natural floor to the market, but also increase the upside in the form of a short squeeze.

So far the Chinese short sellers have been extremely successful.

Buying pressure will increase at some point.... eventually.

Remaining under the last post-ATH low c. $340 = bearish. If price does not exceed this bound and confirm it as support, more down expected.

New targets:

General theory:

An indeed interesting call why you're calling the bottom. 

I was expecting a rally from 600, then from 500 and then from 400.    Now I'm completely dumfounded as to why the current price is at 333.

Agreed. To conclude that this therefore is the death of Bitcoin, however, is fallacious. If it were easy to call the bottom then we all would be rich.

Your 365 bottom prediction aint looking too clever.
so much for cycles.

No common-sense cycle, just a few common-sense explanations for an apparent cycle that seem plausible.

EDIT: Answer to your second question is finite margin constraints.

Nothing wrong with the gist of your argument, OP, but also nothing particularly insightful...

Exemplified by:


That "unelephantine memory" of the market, as you like to call it, extends to 2011, 2010 with some good will, and includes a whole 3 cycles of what you now seem to treat like a fractal. Actually, the 3rd one is still underway.

Point is, as you correctly remind the not-so-new newbies, a bear market doesn't mean the end of Bitcoin is near.

The other point is, as I remind the ever-so-confident crypto enthusiasts, this is still one big, extremely shaky experiment. The fact that it didn't fail the last two times doesn't provide a very strong basis for a frequentist type argument that it's not likely to fail at the end of the third "cycle".

Are you making that up? You pulled my remark out of context. I was not responding to  that declaration. I was responding to your claim that there is a "common-sense" cycle. If its common-sense, then why aren't you a billionaire?

Your accusation is unfounded. Torque's speculation may only be intuitive in hindsight, but the pattern itself is recurrent and consistent through the last three bubble events. The models of consolidation (flag, pennant, etc) are also very predictive of the contours of these large price movements.

The prediction that the $365 bottom will hold seems to have been validated by earlier price action, too.

Hindsight is 2020. I am always amused by the conceit people hold by playing Monday Morning Quarterback.

Yes, this cycle is a good common-sense explanation for the oscillations we see even after daily- and other-scale price movements. I believe these feedback loops reliably force the contours of the price graph into triangular and other patterns. It always makes me laugh to see the fools in the WALL OBSERVER thread alternatively express their bewilderment during the "correction" phase and excitement after each rebound, in real-time, following any indicative movement .

Those are statistical averages. Don't trust those numbers over short periods of time. It's also normal for miners to weigh buying instead of mining to slow the difficulty increases. Twenty days is not a good sample period to make sweeping predictions about wild swings.

In my mind, the price movement in May from $420 to $680 is an Occam's Razor, the easiest event to explain of all the past year.  

In April The Mt. Gox implosion had just happened, and after that the market completely bottomed out for 4 weeks straight.  It was a completely dead market, with no trading activity at all.  Forum participation had fallen to an all time low.  People were saying that bitcoin was dead, and that the price might even fall further.  But it didn't at that time.

So after 4 weeks sliding along at ~$420, at that time it was EVERYONE'S opinion, including the market makers, that the bottom had been found and that the only way to go from there was UP.  Thus the sudden rush for major money sitting on the sidelines to get back into the market for what they perceived at that time as likely the lowest price level of the year.  People thought that in just a few months from then (by June/July, maybe August at the latest) we would probably have another ATH.  Of course now in hindsight, we see that it didn't turn out that way.  And when it didn't happen when people thought it would, of course the market eventually corrected back down again.  This brings us to where we are today.

It's such an obvious common sense explanation, I'm not sure why supposed 'smart' people like JorgeStolfi can't grasp this.

Edit:  Also if you go back and look at the charts, you'll see that this same "mini-rally failed" pattern happened at the tail of the 2011 bubble as well.  It is an observed and well known market phenomena in other speculative markets.

Very very refreshing thread!