Topic: rpietila Wall Observer - the Quality TA Thread ;) - page 210. (Read 907212 times)

Marketing is the absolutely last thing bitcoin needs. 

Who is going to look at a market that is almost entirely speculation, and say "you know what this needs?  MORE HYPE!"

Bitcoin is so far behind where people expect it to get to, there's no need for it to get further behind by raising more people's expectations.

I believe bitcoin will eventually deliver, but with things like Trezor being delayed indefinitely, it's not going to happen tomorrow.

The exchange rate is fundamentally driven by emotion at this time.  It's going to take some seriously positive news to break out of this decline.  In my humble opinion the exchange rate could dip to $100-200/BTC at which level either the true believers support it or Bitcoin slides into a long term niche position.  If the core erodes then there's no one left to champion it.  Crossing the chasm into the early majority is not easy/given.  A cohesive and well-executed marketing campaign is the best way to get us there.

Quick TA update (at $0.429):
- 6H candle color/volume: very little volume for last few days, conclusion: historically bearish
- Bid/ask strengh at market (Bitstamp): slippage to sell 5k: $0.029, slippage to buy: $0.045, conclusion: pressure to the downside, surprise to the upside (when one side has lower figure than the other, it means that price has moved to that direction, eroding the bids/asks - if there is a reversal, it can move quickly to the other side with less resistance)
- Trendline comparison: we are now at -0.420 log units. The trendline is at $1.128 and rising $0.008 per day, conclusion: rock bottom (the 12-month range of the trendline is -0.420...+0.518)
- Sentiment: n/a
- Prognosis: short term risk for downside, mid-term we are still in a downtrend, long-term (3+ months) strong buy zone

Ever heard of Kinder Morgan Energy Partners L.P. (NYSE: KMP) and Kinder Morgan Kinder Morgan Management LLC (NYSE: KMR)? Both represent minority shares in the exact same partnership (with equal weiging) but KMP distributes the dividends in cash and KMR in shares. So, logic dictates that for US taxes holding KMR shares is more tax efficient. Yet KMR has traded at a substantial discount to KMP for a long time (4.5% right now).

The market is inefficient. Deal with it

Ah, the good old 'Efficient Market Hypothesis' - written by an academic,  never subjected to scientific scrutiny, criticised from the beginning by economists and now widely discredited.

Cheers,

With such inflated money supply aggregated within top few speculation trading firms it makes sense for me to say that ta and phsycology has become the same thing. Commercial demand is not the leading driver as it once was. This was evidence with the fear driven speculative plays during 2008. Depends on your tf.. zoom out and ta becomes less relevant to speculation and more relevant to fundamentals for key drivers in a market. For our purpose ta usually makes sense in a speculative perception as we are talking about trading here and thus sub weekly tf...

To further drive home my point if you are a commercial producer and wish to hedge your supply on the futures market speculators make most the market. Funny thing is if you wish to buy these contracts it is assumedthey are not for delivery.. but for selling at close. Thus you have to specifically notify the house that you wish to take delivery and use the market as it was itended for but only 1% of the volume is actually doing such things.

Everything is in price.. A market with sufficient liquidity will be equally efficient to factor in news.. unless its a surprise which even the manipulators dont know about. So a good trader will tell you price is everything.. it tells you a story associated with events. Its ez to get it right most of time with little practice but the art of taking hits and knowing when to quit on a trade is tied to your emotional "stableness" that only a few can achieve over long term.. most dont even know it exists and quit without understanding why other than dwindling balance.

In aggregate they do agree on the patterns

markets are not made to be speculative tools, most of the money moving on the market comes from commercial demand, representing fundamentals. In my experience, speculators generally dont agree on the patterns. There is always an ample supply of speculators to somehow sell into support, and buy into resistance. the patterns we see on the market are mostly caused by unaware speculators, foolishly trying to follow the "news" and such.

Yes, the "charts" are caused by massive herds of people who are "recognizing" patterns they read in a book. These patterns are there in the first place because of people looking for these patterns they read in a book, "recognizing them", trading accordingly and by doing so cause the patterns to begin with.

TA and psychology are quite seperate, unless you are talking about EW analysis which looks beyond the chart. Technical analysis only looks to the chart, and it's not practical to tell psychology from a chart alone.

.. although herd psychology is certainly key. forget the fundamentals, if you can separate yourself from the crowd, you will make money.

lol usually? Isn't that the entire thesis? Analyzing an manipulating herd behavior with self-fulfilling prophecies?

Usually TA is all abut phsycology and nothing else... formations you see that you associate with certain outcomes are based on mass perception as a result of fear and greed. Since humans react the same way repeatedly these can be profitable if you spend time studyinh with a plan to attack. As always you can be right 51% of the time and become successful but most people struggle to find themselves thus give up trading. Those who learn to cut losses and move on will utimately succeed in any TA/FA analysis... the rest are buy/holders who believe in long term prospects.

Exactly. And then you try to be patient and wait for the price to come back down and it doesn't.. then finally at $600 you capitulate and buy which happens to be the top

I have started to observe it daily only since January this year, but so far I am surprised how repetitive this market seems to be. On the other hand, I am still afraid to trust this pattern completely, it can lull us into a false security, and then it can suddenly break, for whatever reason

[quote author=TERA link=topic=400235.msg6517762#msg6517762
Most of my posts are about short term trading, and take note of the condition I mentioned "if the trend were to continue" - meanwhile I didn't say anything about whether or how long the trend would continue.
[/quote]

You are my favourite bear because you are a short term bear. That's what makes a bear a plushy teddy

In addition, probably because it is such a new, small and free market, bitcoin acts very predictably once you recognize the patterns. Unlike the dow, where you are trading against high velocity trading bots, market makers and unseen forces creating supply and demand, with bitcoin, you can actually study it enough to see how it acts.

It almost acts often like all the traders are in agreement - that is how predictable it is compared to other markets.

Ta is good at predicting the way things move under opposing forces and analyzing the raw data of supply and demand. I can sit here and try to predict how a fundamental should affect the price, when a fundamental will affect the price, and how much of the price is due to fundamentals, but I will likely be way off, and trading just the price will be much more effective.

I have not studied TA in any depth so forgive me if this comes across as a naive question. My understanding of technical analysis is that it assumes that prices already reflect all the underlying fundamental factors. If you believe in the concept that Risto put forth a week or two ago in this thread of the profound asymmetry of information between those who know about bitcoin enough to have invested, versus those who still don't know jack shit about bitcoin -- doesn't that imply that prices do not reflect the underlying fundamentals, making TA not so applicable?

Most of the time I edit my post about 5 times within 10 minutes of writing it to correct spelling errors or write additional points. I don't edit my posts later in response to a discussion.

Hmmm, you edited your original post to sound less self-affirming about potential trend-line falsification.

Just as well, short term...flort...ferm...