Topic: So what does this chart mean for bitcoin? - page 2. (Read 3529 times)

Hmm, I guess you are right. Too bad.

I still think may decreasing growth of value influx-theory has some substance, but it is probably applicable to a much larger time frame anyway. We are not even at 0.0001% of the potential value that may ever be converted into bitcoin. I therefore estimate the function of that particular growth to be very much at its beginning still.

The memory of traders seems to be also valid IMO, as evidence I would like to provide this graph here (switch to any time frame if you like):



The neighbouring areas of high volume seem to move up, never down (except for stark movements). From that I draw the conclusion that traders on average refrain from selling before their base price is not met. This way resistances and supports can be perfectly explained also.

Well the thing is: People (including me) did that with a line on a exponential chart by drawing a line from this point straight up... that was back before the crunch. We were wrong.
This is just another iteration of the same fallacy: The belief that complex mechanics can be oversimplified and still be somewhat valid.

If we go below that curve you can simply scale that curve and have a new trend. Or somebody else comes along and makes it a polynomial or something. If we explode now in prices there will be other people who said they predicted that using some other mechanism.

Reality is different and to come up with a prediction over the next few months like you did you would need much more effort to have any more power than just random chance.

It seems more likely that whatever caused this expansion simply started at that time and value and not at 0/0.
Remember that the price is a cummulative value many things influence it.

It would just be upside down. And I can choose a smaller interval to make it fit any way I want too.


Mobodick: It has more than one term because it doesn't begin at zero|zero.

Interesting!

No you cant. If price drops below the red line it wouldnt be valid anymore. It would rather show an average direction, which is what you can REALLY do with every chart.

But what i drew IS a one term function (made with a graph tool).
That's why i think it's special.

I think this chart can best be explained with the money people put into bitcoin by converting fiat or other assets to bitcoin.
Its getting more and more over time but at a decreasing rate, because to expand the market capitalization at the beginning was cheap, to expand it by the same degree right now takes considerably more money! As with all growth processes in reality, that are restricted by finite resources (like value supply), this growth rate will finally reach its maximum, or grow increasingly smaller as the consumed resources dwindle. I think what we see here is the result of just that. It will continue to grow till a certain saturation is achieved in which mediums of value converted into and out of bitcoins balance each other out. What the function symbolyses is the sum of all value traded for bitcoin. Price can outperform this level fueld by speculation and expectations but finds it hard to drop below for some reason. It may be because holders of bitcoin still remember the value they put into bitcoin to aquire them and therefore refuse to trade them in for less. This effect, if valid, would further strenghten this bottom line and push price up.

I guess that more then the two effects are at play here and work in conjunction with one another. What they are remains to be seen.

It's not one term. And yes you can do the exact same thing you did on every chart. Just plot Brownian motion on a chart and do it, you'll see.

But could you then go on and describe this curve with one term?

LOL, yes,
brainfart i guess.

It's y=x^z and z is someting like 0.55

The explanation is you can derive some lower bond curve for every possible chart.

So y = the x'th root of x?

This is not a thread about driving, this is a thread about why the hell bitcoin value has such a mathematically simple bottom.

I wonder if the maker of this chart drives his destinations by using the patterns of the roads behind him

Hmm, You got me.

Exactly!

To be more specific, i photoshopped in a plot of the form y=x^z

Somebody drew a line on a graph? One that is not linear and apparently not even logarithmic no less?

This is great. It gives confidence.

I found this nice line to bitcoin price.
But it seems systematic and not related to what's going on on the exchanges.
It's almost like a built in system.
Can anyone offer an explanation for this mathematically simple rise of minimal price?