Topic: Pessimist's Exponent (Read 2557 times)

Well Bitcoin has been both the best performing asset and the worst performing asset in certain years
So the pessimist view is always one to be noted but it should be noticed there really is no middle ground for a year and my bet is that this year is a best performing year.
http://money.visualcapitalist.com/bitcoin-top-performing-currency-second-year/

Corrected and updated.
New exponent is based on [1 june =  $2k, 1 july = $3k] assumption.

I know this is an old post, but I have not seen it before, so I just want to explain about trend lines.
 
Think of that imaginary line as a visual representation of the rate at which market participants become comfortable with a price change. The price spikes up, the market doesn't automatically accept that as the new floor. Instead, gradually building support beneath that spike in sort of a front running characteristic. Each buyer moving in front of the last, but still trying to get the best price they can. This is why trend lines work. Now, throw in multiple points of contact without failure and you begin to see a trend develop. Once that line is broken, it signals a failure of support for the continuation of that trend and a new base must be established. Simple violations are often ignored as "outliers", while closes and time spent below the line is evidence of that failure. Also, as the slope increases, this is where people are getting impatient waiting for the price to come back to the line and what creates new trends. These new trends, each steeper than the last, triggers a little more frantic behavior and FOMO is born as parabolic moves unfold.

The price definitely can go down further because the line is broken, but more of self fulfilling prophecy rather than the line itself since traders follow the lines. The line is just a representation of support. Once broken, odds are that price will continue down until people are confident buying again. It is exactly the same as moving averages or Bollinger Bands. Even indicators like RSI and MACD can have trend lines or levels that signal a change in the market dynamics.

Edit:
Consider this chart. The orange trend line is well established and has multiple points of contact (and a violation, but no close below at the ii). Then the parabolic move in blue. If the blue line breaks expect the price to fall near/to the orange line to find support. If the orange line breaks, there is a very good chance to have extended consolidation below the line as a new base is formed.

We need sustained growth and not bubbles, I know that everyone loves to see the price of bitcoin to be sky high, but then the price hits rock bottom and we all suffer the consequences, it is better that we have growth that is slow instead, that way we don’t have to be glued to the monitors of our computer looking for every single movement that bitcoin does.

The second graph is like the first, but it shows the percentage of the trend line(s).

What is your middle chart?

Update.

Trying a different exponent (blue line) to describe the recent trend.





Disclaimer: as usual, don't take this too seriously. I'm experimenting just for fun.

well, as long as you don't put your whole fate in a chart which is only an extrapolated data and not a prediction, i guess you will be fine with it.
i say this because there is nothing saying things won't change, price can start rising with a higher speed or with lower speed depending on what the future holds.

The prediction will definitely incorrect if we add the year 2013 it will messed up the math unless we can see a parabolic graph here, so definitely after 2017, price will decline but well this is just a none fact statement. 


Not quite realistic because there has not shown any resistance in the computation.  We all know that price whatever it is there is always resistance.  This is just another speculative calculation though I also looking forward to it.

I don't usually see the point in long distance speculation.
It is nothing more that guessing where you base your prediction on past price charts and mix this knowledge with expectations + add personal bias.
This time I agree with you, this is solid prediction, not overly positive and quite realistic. I am looking forward to it.

PS. How high BTC will spike after next halving in 2020?

I love this idea. It's much more realistic than basing future price projections on the highs, which are driven by irrational exuberance. $2000 by the end of 2017 is a realistic target.

The move is to buy every time the price touches the trend line or drops below it. This assumes you have a long time horizon and you're trying to build up a bitcoin-cost averaged position.

Great.  All the little drops and rises have "only" been within a couple of hundred dollars recently.  It looks like the price will be much closer to immune to FUD once the price goes any higher than it is now and hopefully there will be some more liquidity on exchanges when there's proper regulation - then we'll see the steady, compounded rise to the moon.

Watches the link, becomes happy.
Goes to sleep.
Thanks.

Update. Everything's fine so far.

The drop really continues right now and I hope that it would stop at some point later on this week since if it don't I think were gonna see btc on a low price again but not that low when compared to the past low prices that we have seen so far but it can be considered low considering that the price went up to 1200$+. I really do hope that it stops and rises again.

The drop continues

And now we are below that line.

this is exactly what is wrong with this kind of analysis and why i never liked it and most people call it psedu science anyways

everyone interprets them differently and when they come true everyone says it was a perfect speculation and when they don't come true everyone tries to come up with excuses and additional scenarios to make them work and again when those additional scenarios don't work they come up with more and change the lines again.

it is a broken chain based on a false base.

market doesn't move based on lines on a chart so that if one of them was broken, it goes further down just because an imaginary line was broken.

There are other ways to interpret this - if it breaks the support line - than we'll have a big correction. On a log chart this is a straight line - so many chartist will treat it as a trend line and support.

The history of other exponential fragments supports this. It is pretty silly to reject most of bitcoin history as 'outliers' - outliers are the exceptions, they cannot be the biggest part of the data.

let me quote you so it shows up here too.

and although i don't really like speculation like this, specially when it is similar to extrapolating data from past to get the future but this particular one (which has also been discussed before) seems to be working for bitcoin. the price is rising on this line.

in any case this is a long term speculation and because of that i can agree with it.