Topic: rpietila Wall Observer - the Quality TA Thread ;) - page 221. (Read 907212 times)

Edging ever closer to the November 2013 bubble collapse resistance trend line. The drama continues as illustrated on the 1-hour resolution Bitstamp chart. China leads the way, with no-fee trading on Huobi yielding 8x more volume upwards . . .

Yes, this is the key. At the present time the buyers and sellers of labor for BTC are too few, but in the next few years this will change and a snowball effect will occur. BTC users now can start to help that process along by insisting on giving tips to people in BTC, even if they are not interested at first. If you hire someone to do landscaping work, pay the full price in dollars, but then offer to give a 10 dollar tip in BTC. It is likely that the person will take two minutes to download a wallet app to accept the tip, and then you have helped increase the distribution and user base of Bitcoin.

Here are some examples: http://2dyr4w3trph93kswidi3cpln2x.wpengine.netdna-cdn.com/wp-content/uploads/2008/02/pennystockingslides75-841.pdf

How many other examples of a 99% speculative bubble have we have in history other than BTC that are NOT pyramid/ponzi schemes?

each time delusional speculators pump BTC up to a silly price, would it really surprise you if the consolidation phase was always the same length roughly?

bubbles are all the same, a bunch of delusional speculators. It would be interesting to compare all speculative bubbles in history to find an average consolidation period length, but we cant do this because most bubbles never recover OR are not entirely speculator drive (fundamentals affect the price)

Perhaps the explanation for a steady sequence of boom bust cycles is that this is the first time it has been subject to occur, and we are watching speculators in their natural environment in a way never seen before.

I had the same notion from a different viewpoint.

There is an obvious disruptive market for bitcoin transactions whose purpose is international remittances. Here in Central Texas, there are many non-bank facilities for sending payments to Mexico. I am awaiting the development of local Mexican bitcoin economies that will form a virtuous circle of adoption. Supposing that bitcoin remittance payment recipients can simply spend bitcoin locally, there is no need for an exchange on either end.

No banks, no exchanges, no problems.

Aminorex: the full weight of what you said just hit me.  Many people in the world will never buy bitcoin.  They will simply begin to accept them in exchange for their time.  

Thank Aminorex.  I agree that what you wrote is more accurate (and more powerful) than what I wrote.  Like you implied, the growing perception that bitcoin is legitimate so that people accept it in return for their goods and services becomes an efficient coin-distribution mechanism (further legitimizing bitcoin). 

By this logic, it would be beneficial to the bitcoin economy if we could slowly move more of our work into bitcoin space.  Perhaps this could be a killer-app for bitcoin: some sort of "work pools" for small tasks that a bright young computer programmer from Nepal (or anywhere) could participate in.  I can often break my projects down into small, well-defined tasks.  I'd rather pay someone 200 mBTC for creating and testing a few C++ functions, than write them myself.  And since the average yearly income in Nepal is $182.46, this could create a lot of demand for self-education, empowering people in the process. 

It is my understanding that rpietila and other spend a considerable amount of resources in order to answer this question.

Ultimately, don't see how an answer can be derived before the fact, especially at this stage.  It does make sense that at the point of mass appeal as initially met from hyper-accelerated interest, the gravity of 'fair market' price will create a spectacular correction as the subsequent oscillations 'bubble' us around that fair market price line growth.

However, I believe this is assuming the free market is allowed to congregate as governed by a dramatic bell curve of individual interest in joining the collective.  There does exist the potential, no idea how probable, that pro-active capital interest dominates the acquisition of coins and inhibits later stage individual acquisition.  This is I assume, what most here are hoping for, as there would inevitably be rendered a dramatic price squeeze.

In the case of powerful capital interest staying ahead of and thus creating more demand in the individual collective, the notion of a spectacular correction as described above becomes more confusing. If such service-oriented financial interest attempts to monopolize coin supply in droves, it will surely be to hold and re-distribute through profit-seeking gateways of re-supplying the free market.  As such, with a top-heavy organization of coin supply, the natural and organic oscillations of adoption as rendered by a collective of individual interest should be exhumed by said coin control.  That's what makes sense to me anyhow.  

It appears that this is what is indeed occurring.  In this case, it may indeed simply be a matter of acceleration and velocity, utilizing supply and time.

In essence then, perhaps at some critical juncture that may be arriving soon if not already underway, the growth cycle pattern as rendered by the speculative interest of the individual collective will be engulfed and left behind by a possible inflection point, at which point said collective will play catch-up, or simply be on the other side of a threshold whereby said interest is virtually non-existent, and the rest of that potential population has no interest in acquiring for speculative value, and are 'forced' or guided through acquisition as a means to a service-based end.

To add - bitcoin is detached from traditional technology adoption s curves in that it is also a currency, with speculative interest and money velocity as forces in its life-cycle.  That is not to say it should not adhere to sigmoid-like growth, but its path is surely more convoluted, with the potential for a novel pathway or at least certain exceptions or even more dramatic support of the phenomena along the way.

The powers of the FRB would render USD illegitimate by a similar argument.   I don't ike to see the diffusion argument applied without making it limits clear.  Currency distribution always follows a power law.  Distribution can occur in many ways, but the main way it occurs is by trade in goods and services, which is the best and healthiest way.
True, but that buying need not be in fiat.  I may buy with goods or services.  I would rather see liquidity in that market than in the exchange market, although both are good.

Thanks everybody. You didn't manage to explain it all away in one sentence, but I'm clearer on how meaningful the pattern is, having read all the replies.

The answer seems to be that it's just an accident of the circumstances affecting the market. This is just the ebb and flow of sentiment towards a brand new class of asset that possesses intriguing properties and potential for revolutionary mass appeal. In other words, this is an unprecedented market. The closest precendent I can imagine is artificial. It's like a composite of the age when gold was popularised as a universal exchange instrument, together with the introduction of information tools that came out of the electronics era of the 1970's and 80's. Even that isn't adequate to account for the specific details of the "information tools" part that make the satoshi model what it is, and could be extended to.


I guess this leads to another question about the trends: what will characterise this phase of adoption once we have 8-12 years of charts to refer to? What, if any, recurring pattern could take place on a timescale that's one order of magnitude higher? When you consider the projections about long term adoption, this phase should see the least price growth as a part of the whole.

So, given that there will always be notches and bulges in the growth as it deviates about a long term trend, where does the current super-phase fit? Do we simply have to "wait til we find out"? Can we see past that "event horizon"? I suspect the answer is no, but again, it'd be nice if someone would shine a light on something obvious that I'm missing.

The aborigines did.

Quite worthy of 4/20. I approve. Probably.

That was deep.  Or something.

When one looks up at the night sky and sees the stars they are randomly distributed.  Yet people see patterns which include bulls and bears.  The Greeks never saw kangaroos in the sky.

The theory you are looking for should also explain why the first two intervals (in 2010 and 2011) were twice as short: 4 months, rather than 7-8.

Markets dont repeat they rhyme.. So it will happen when you least expect it.. Same as prior cycle analysis that led to targets of $700 and ppl laughed at the speculation.. at the time seemed that it was more grasping at straws but it happened and did so during bearish sentiment. Big fish need panic to accumulate and gloating to distribute.. every market is the same so we watch for a trigger and sing the boy who cried wolf until he actually shows up.

Its like opening up a charting package big fish used amd sticking on the stochastic indicator and backtesting with 95% hit rate because at the time the
big fish got to it first and just used defaults.. But today it almost seems like the signals are reversed because people backtested and assumed to stick with the
setup. In the end if you zoom out and consider fundamentals then price wont be a puzzle.

1) Fiat is in a path of destruction
2) Can bitcoin be a savior? Can it offer utility such that every person with internet will use it?
If so then you can validate a bull going fwd..

There is nothing the fed can say that will give me hope that fiat can and will work for us so question 2 looms.

The collective cannot be brainwashed the way it was before
because of the internet facts are brought out and the market is understanding now the reality of the coverup that the fed has been a part of since 1900s. Only way is to enforce and not sure that is working out too well for them right now.

I think we are also seeing some nice consolidation @500.  The longer it goes on the better imho.

For what its worth... you mean "bodes well"  since "foerbodes well" is an oxymoron.

Curiously, this consolidation cycle has been first to break the cycle of wedges. I like it, a nice deep retracement forebodes well for the future.

You jinxed us Carlton    

But like you said, cultish expectations about price cycles are dangerous because they can be exploited.

Nobody said bootstrapping a new world currency would be easy.  On the one hand, if no one sells, the coin distribution will never become diffuse enough to be considered legitimate.  But on the other hand, if no one buys, then the entire experiment collapses.  So if bitcoin is to succeed, it must repeatedly find new ways to scare us into selling some of our coins.  If it stops doing that, then by definition it can't succeed!    

So now it's my turn to help bitcoin succeed by scaring everyone: the reality is that no one knows for sure what will happen.  Bitcoin could go over $1,000,000, or it could crash to the ground.  All we can do is place our bets, accept the risk, and encourage the use of our peer-to-peer electronic cash system across our spheres of influence.    
 

Crap. I was hoping the first comment would shoot the whole notion down in flames of sage and knowing technical analysis  

Still, you've given me some encouragement. You've reminded me that the nature of this new tool we have here means that the network effect drives adoption, which in turn drives the price cycle. And that's a very powerful mechanism when you consider the backdrop of worldwide recession, financial repression of various types, the increased political tension with many causes and effects etc.

I'm still not satisfied that we can account for the uniformity of the cycles, although maybe I'm overstating the case for a rigid pattern. The magnitude in price change has been less than uniform for sure, and to say that the periods have been identical is not true, they have just been similar (and probably up to 33% difference in the length of, say, the panic buying phase before the correction).

Still, I am wary of getting too cultish about expectations in price cycles. If not accountable to a scrutable reason, then the apprehension of the cycle is prone to exploitative actors (especially those that are aware of information that affects market conditions in advance of announcement). I'm not sure why I've decided today to start stamping on the burgeoning price confidence, just that it struck me that the log graph of the 4 growth periods post-2011 is becoming more common on this forum, with nothing that explicitly explains the cycle length in the TA threads.