Topic: rpietila Wall Observer - the Quality TA Thread ;) - page 153. (Read 907229 times)

Mr. Reed is not updating his trendline, which has become a problem after a few months below the trend. Actually it should be now at about -0.4 instead of -0.5. The difference is 30%, which is not insignificant

My latest one shows that there is no way to predict the start of the uptrend based on the relative price in the trendline only.

There IS a way to rather accurately predict the end of the uptrend, especially coupled with other indicators such as the doubling-time introduced by Mr. Reed.

There IS also a way to tell that -0.4 (or of course -0.5 if we ever hit it) is a very-low risk entry point, with a low chance of even moderate decline of the investment's value historically evidenced.

We'll just have to live within what is possible to predict, and with what probability. What I would not do at this point is to strategically sell bitcoins (even a fraction of your holdings), based on "it's going nowhere". If you don't need the money, just keep the coins. Their price is not going down!

I know it is hard to get anyone to buy them at this exact low-point of risk, which is the high-point of reward. But that is just the way of markets. The technology is silently getting better and more approachable, wall st is joining, etc etc., we'll just have to wait.

In my opinion, based on rather successful investing since 1996 (bitcoins 2011), we don't need to wait too long for the next runup in price.

Shameless repost of my new research, originally in the Trendline thread:

I just updated my personal sheet tracking these things. The parameters of that one:
- flat price 0.005 assumed until Mt.Gox opens
- for 7/2010-2012, Mt.Gox prices used
- for 2013, three exchanges
- for 2014, Bitstamp only
- daily VWAP
- first day 2009-1-3, the first day of Bitcoin; last day 2014-7-9, the 2014th day of Bitcoin

The exponential trendline for this time:
USD/BTC = exp(-2.869800 + 0.003012 * D), D being the number of days

R^2 = 0.934183

The trendline is at $1583.

At $623, we are currently -0.405 units below the trend.

For comparison, the max we ever went below the trend prior to the first 2013 runup, was -0.573.
Prior to the second 2013 runup, -0.341.


The maximum downside (greatest drop in price experienced ever after) after a day when price has already been at a low of -0.4 or lower, is -19%, experienced in 2012-10-5 to 2012-10-26, when the price dropped from $12.75 to $10.31.

This is comparable to the price going from $623 to $504 this month. This would put us on par with the maximum historical downside from already such a low point as $623 represents in the trendline.

I will not go to the upside calculations now, just leave the closing remark:


TL;DR: Historically, buying at a price such as this has represented a very low risk entry point with very limited downside in dollar terms.

Historically, selling at a price such as this (for any other purpose than covering immediate needs) has been counterproductive, as it is very likely that you will get a better or at least not much worse a deal; 1, 2, 3, 6, or any number of months in the future.

Everyone is on vacation while we reached -0.5 Log from the S.reeds trendline

It's already 30 weeks after last ATH (last one ,,consolidation period'' took 27 weeks)
 
If market would repeat itself identically we would need one more high volume sell-of to trigger run-up, if I made right assumptions?

Wow that was "gold" sorry for the pun. Maybe one day we will say wow that was bitcoin instead? lol

I see your point and I think most of us here don't really claim to know what eventually is going to happen to BTC. But it does appear that the first mover advantage is a very very difficult thing to overcome. And now we can see BIG money (e.g. Wall St., Venture Capital funds, etc.) jumping on board with BTC. They will try to protect their investment at all "costs". Throw on top of that necessity, like remittances and person to person value transfers. The list goes on.

So, let's say there is a bubble in BTC. Where are we on that timeline? I bet you most would say we are at the very beginning. When the internet bubble happened (2002? ish) we all knew what the internet was. It had gained mass adoption due to AOL (those CD's all over the place), masses of websites, multiple ISP providers, etc.

At this point in time, it appears very premature to say we are anywhere near THE BUBBLE popping. I mean most people don't have a clue about Bitcoin. When the internet bubble popped money was beyond flowing into it, it was crazy. That is JUST starting here.

Here is a nice calculator to look at all of the variables involved in predicting Bitcoins price. We are just getting started (and that is NOT to say we don't pop/adjust in the interim).
http://worldbitcoinnetwork.com/BitcoinPriceModel-Alpha.html

But between protocols there were wide differences. If protocols competed for the same functionality: one won. Most altcoins aren't different from Bitcoin in their application. You fill in the blanks.

Thank you for clarification.

Protocol is money, yes. I would say that all the cryptocurrencies are some kind of protocols in their kind. We can say that if BTC is "kinda TCP/IP", then other alts are other protocols (either higher level like HTTP and SMTP or same level, like IPX, AppleTalk, etc.). Some of them will fail being a standard (IPX, AppleTalk), some won't.

But that was not the main idea. I am trying to convey that there will be the boom of companies that use cryptocurrencies as the main underlying resource, just how Pets.com et. al. used TCP/IP and HTTP. Let's call them cryptofiners (operating with cryptographic finances). This must lead to de-facto standard cryptocurrencies rise drastically as they get higher and higher demand. These cryptofiners will appear and appear causing a bubble similar to dot-com bubble, consequently, leading to cryptocurrencies' value bubble as well. Then the majority of them will fail due to the same reasons the majority of dot-coms failed. Some may survive but that won't stop the whole cryptofiners' bubble to burst. Along with it the value of underlying cryptos will fall. That's right that protocol itself haven't failed, however its value will decrease significantly.

This new bottom might be either at this level in case we are on the verge of cryptofiners boom, or at several K$ in case we see that boom after next rally, or elsewhere, but I see it very likely for dot-com bubble history to repeat.

Basically, I was saying that your statement was based on an analogy. This is very simplistic. Not that simple isn't sometimes right, and not that your analogy was completely false, but the replies to your message, showed much deeper and well thought out possibilities.

The analogy you pose, loses traction (or grip) as we start to understand that the protocol in this situation is money (for starters, and when you look at the further uses of it, more value is added). So, not only is it money, but it is a backing for other technologies which will be built on top of and along side it and all that they entail. (e.g. Counterparty, NXT, Ethereum, etc.) So, where as we can't exactly buy "http" we can by "BTC". The companies that bubbled and crashed are not exactly analogous to BTC itself crashing, where as those companies were built on top of the internet, they were not the internet (http). We might say any of Counterparty, NXT, Ehtereum, etc. might fail, but that is not the same as BTC failing. BTC (http) is not going anywhere anytime soon (unless there is a catastrophic event), so companies such as Pets.com, etc. might have failed, but HTTP never bubbled and failed. The analogy you pose is incomplete and has to be, as the current technology of Bitcoin (and it's blockchain) is not just a protocol. It also contains an intrinsic value in a sense.

Its about sharing

Sorry, I haven't exactly caught the tone of your message, either it's positive or negative. I assume that's due to English not being my native language. Anyway, I'll expand the idea behind comparison with dot-coms.

WWW and HTTP is very good example. Considering that blockchain is underlying technology like TCP, HTTP, etc., let's imagine we could had bought protocol shares back then, before the boom of dot-coms, just like we now buy Bitcoin and alts. Then, during the dot-com bubble, the price of these protocol shares would likely have risen along with dot-coms and crashed later. Just because underlying technology is not as demanded as before and initial euphoria is gone. That's what I meant by speaking about bubble crashing. Even though I wouldn't mind it for growing indefinitely, as I suppose the majority on this forum do, I don't believe it could. At one point it will fall heavily and it's better to be ready for it. I'm not saying it's going to happen tomorrow or happening already, just at some point in future.

I love how these types of simplistic, short sighted, narrow, etc. comments (following):

Bring out TRUTH that not only squashes the OP's comment but does so in a multi-faceted way.
Not only do we now see the diamond that is Bitcoin (and cryptocurrency like tech) but we get to see more of her facets thanks to the bright comments shared here.

Its About Sharing and thanks for doing so  

Great point. Makes for a good sales pitch.

Where do you live, France??? Stateside investors only take two weeks off in August. If that. Haven't you seen the famous Cadillac commercial?

https://www.youtube.com/watch?v=qGJSI48gkFc

(btw, Bill Maher did a great parody of that commercial:
https://www.youtube.com/watch?v=EjqIgeFR6Ds )

The dot-com-comparison is very interesting as it exposes a totally unique property of Bitcoin. It has always been possible to invest into companies that utilize a new technology in some way, but this is the first time ever that you can invest into the technology itself. This doesn't necessarily make Bitcoin a good investment, the decision is still up to anyone, but IF you expect mainstream success of this technology, it's extremely easy and safe to take part in it.

Imagine you were back in the 90s, the WWW is starting to gain traction, you're convinced of its golden future, and you are able to buy shares of the HTTP. You don't even need a brokerage account or anything, you can do it in any amount, by cash, anonymously, on the street. That's pretty amazing.

People are arguing that only crypto-currency as a concept can be considered analog to HTTP, not the concrete Bitcoin implementation, which is more similar to things like Facebook. But what has survived the dot-com-bubble is not a multitude of viewable-content transfer-protocols, but HTTP. Complementary blockchain-based protocols for special applications will probably exist, too, like there are protocols for video streaming, filesharing and so on, but the network effect is too strong for payment-altcoins.

Every time I reflect about the basics I am more convinced that mainstream adoption of Bitcoin is unavoidable. Printed-page-style information has been transferred by third parties in a slow and cumbersome way for ages until the Web took over in an instant (historically seen). The Bitcoin protocol opens a similar evolutionary path for money transfers. We're still at an early stage and I'm sure the next decade or so will become increasingly interesting.

Why does part of me want to see a reality TV show of windjc visiting Risto at his castle?    Maybe I need to question some impure motives within myself for that!

All in all, I think Bitcoin users are an interesting bunch.  We all come from so many different backgrounds.  Having a relative stay with us from New Zealand last week, and seeing how completely annoyed she was at our bluntness and how opinionated we were kind of opened my eyes to how as Americans we can really tick others off without really meaning too.  Saying what we want without any filters, or perhaps what other call "respect" is perhaps just allowed a bit more in our culture.  It is often in good fun.  We like a good debate and enjoy the banter.  It isn't necessarily something that calls for a duel.  That said, I am still not sure who is right or wrong.  Perhaps we are obnoxious and other Europeans are more civilized? 

I also don't pretend having a castle..
[/quote]

So you do actually have a crystal ball or you don't actually have a castle?...or did you take offence to something I said which wasn't meant as such

Anyways I'll say again what I've said before, I respect you and what you've done for this community over the years regardless where your mind goes to after its beginnings.

That's some quality real life drama over there haha.

But I agree, no matter how rich you are or feel, you gotta have some manners.

It's just not cool being a rich jerk, or a poor jerk. Or a middle class jerk. Whatever. Be nice.

If your humanity forbids apologizing when you have wronged another human, why do you even desire to visit the castle? It will be a painful experience for you to find other people in harmony with each other - such a contrast to what your actions testify of your inner reality!

I'd say if you hold more than BTC100, the place might interest you. For lesser holdings, you should concentrate on building a bigger balance first.

When bitcoin goes up, there will be more castles and the cutoff grade to be part of one (also the supernode threshold) will go down in btc terms.

By the  Law of conservation of energy, it would be more wise to waste the Energy and Time on more serious talks.

Those who don't understand their mistakes, will not recognize their faults. And are far from apologizing.

Rp, what's your plan with the Malla, will it ever be a place for less than BTC1000's+ supernodes?

As a Fusion of different age and ability personal generations could spark some new and exciting ventures in the space.

I never insulted your loved ones. What are you talking about?

All I was saying, is that one day you will be happy to have me at your castle - windjc.  You will consider me a friend, although you don't believe it.