Topic: The correction and recovery in a nutshell. (Read 5604 times)

I had shorted well in advance of your advice but

This

was quite frankly fucking shit

Hope you don't mind me

I am

stupid

for shorting cos I just love the sight of Bitcoin crashing

All of this is far too sensible for the speculation forum though, so I advise SHOTR immediately, because that descending wedge on the 5 minute chart looks really bearish... or is it a triangle thats bearish... If only I was a trader...

Quote this for truth:

Buy as much as the fuck you can, right the fuck now [Bitcoin at $806]. End of January comes and all the sell the (OMG CHINA BANNED BTC) rumours, are gonna buy the news. Not to mention all the "lets see what happens at the end of jan" dollars sat on the sidelines.

What can I say. That was probably one of the most eye-opening things I have ever read on here. The early Bitcoin adopters were not cut-throat pirate financiers who like to drink babies' blood at the weekends on a full moon. They were wild-eyed libertarian zealots such as sgbett who have seriously lucked out. I made a 'near term price prediction' thread when Bitcoin was hovering at 790, telling people to go long Bitcoin, then short at 815-820 range. Bitcoin then done exactly as I predicted, at which point sgbett jumped into the thread and had a rant at my day-trading antics telling me that I should just be buying as many Bitcoins as I possibly can at these prices cos Bitcoin is going to $10K. Someone who bought Bitcoin at $1, getting ratty at someone successfully day-trading Bitcoin and demanding that the daytrader buy as many Bitcoins as he can, at $800!!

This is a long shot.

Are you Q-bit from techpowerup forum?

Disclosure: I own and mine both BTC and LTC.

Guys, proper form is to attack the argument not the person that delivers it. Nobody wants to see this thread degenerate into name calling contest right?

Other than that I would like to hear your counter argument. What do you think will happen to the bitcoin price?

Disclosure: I own and mine both BTC and LTC.

Your analysis is correct, although I'd shorten that to "idiot" Someone who desperately tries to appear knowledgeable, to cover for an actual intellectual emptiness. Will grow into a good investment banking assistant, saying many words with no meaning.

Socratic reasons. You are not a fucking philosopher or some kind of higher thinker. You are a pompous alt-pumper.

You know, somehow I can tolerate Mat's doom & gloom brand of bearism... at least he has some skin in the game in a way most bears rarely do, he's actively shorting. I appreciate the drama around that, if not his analysis.

But you, Impaler...


You just sound like a pompous prick when you put on that bear suit.

I remember the last discussion we had about this topic.  August 7th, in one of chodpaba's threads. Price had dipped slightly below 100 again these days (on bitstamp), and based on the same "I have a deep insight into the psychology of miners" bullshit argument, you predicted, what?, going back to 50? Something like that. You recommended fucking shorting, in fact, a few days before a trend that took us from ~100 to ~1200.

I'm sure you will forgive me if I'm not exactly reading your analysis based on miners' sales/hoarding strategies with the utmost reverence.

Interesting, as I always suspected that people who need to quote the almighty Wikipedia rather than being able to rely on their own brains come across as idiots! 

Essentially and importantly true.  Worthy of deeper discussion, on both the necessity and sufficiency sides.

Clearly you don't mean this specific chart is necessary , but rather a chart conforming to the necessary conditions.   Knowing what those were would suffice to detect when they fail.  Similarly, clearly identifying the sufficient conditions would enable one to determine whether they were present.  I'm not going to contribute to such a discussion presently, but I hope the value of it is clear, and that this clarity motivates thought.

For the bootstrapping phase of a global, peer-to-peer {reserve currency, store of wealth, payment system} USD/BTC necessarily looks the way it does;

The way USD/BTC looks is not sufficient to guarantee the success of this becoming a global, peer-to-peer {reserve currency, store of wealth, payment system}.

Very good analysis Mat, I'd like to voice my speculation on WHO the manipulators are and WHY they act as they do.

First off WHO, the simple answer is 'deeper pocketed versions of the same zealots who have been railing against you in this thread', I know this seams almost anti-climactic doesn't it.  You normally think of manipulation as being done by people who are fundamentally different from the 'small fry' both in the depth of their pockets AND a more 'predatory' nature.  We don't expect manipulators to be delusional zealots but in BTC I think they are.  First off we know for sure the big holders of BTC are early adopters who drank the kool-aid very early, these folks have now accumulated sums of USD in the several million range (all still on exchanges mind you) and they thus have leverage on both sides to control the price.  'New' investors might come in with huge sums of USD but they can never match the BTC holdings of the early adopters so they can't do the kind of narrow-holding range manipulation your seeing, they can only cause a price spike as China effectively did when it entered the market.

And the WHY should be evident from some of the posts earlier, the manipulators feel they are 'saving' BTC from the evil forces of the Persian Army  THIS IS BITCOIN!!!  HODL!!!!!  This meme is very telling, we see that people equate the price of BTC with the success of BTC, this view is reinforced by the detractors that call BTC a bubble.  If the supporters 'HODL' the price up high enough then they are 'right' about BTC and everyone else is wrong, and most importantly their Libertarian wold-view is right and everyone else is wrong.  And these people see libertarian/Austrian economic theory as something that needs to be promoted and defended at any cost.  All of this is to ultimately as you said yourself fell that this is the "result of something inherently great about themselves", an ego trip that completely validates their political beliefs and ideologies.

Now what dose this mean for the long run price, are they preparing to crash the market some day and leave the rest of us holding the bag.  NO!!  These people will WILLINGLY go down with the ship if BTC ever finally tanks, nigh they would flaunt their martyrdom saying they 'lost everything because they had FAITH and held to the end, if only the wretched weak-handed fools had not crashed the price of BTC we could have defeated the evil gobermint and the FED and the USD and ushered in a libertarian Ann Randtopia!!!  The know that a fast-crash attempt to empty the exchanges and exist with the USD will net at most a ~40 million in exchange CREDITS which have very little chance of actually being redeemed for real USD at that scale, indeed most of the credits are on Gox which may not even be solvent and which will de-facto force them to put thouse credits back into the market, so for the whales BTC is like a tuna-net in the ocean, they can swim around and seem liquid but are really quite constrained, they realized their BTC AND exchange-credit wealth is illiquid and they like it that way, weakness should be PUNISHED not rewarded after-all (I wouldn't be the least surprised if their are intentional retaliations against anyone who breaks ranks and tries to cash-out).  So they are happy to just get a trickle of USD as they so very slowly sell, it's still enough for them to practically live off and it's more then they deserve anyways so why not keep this whole BTC thing going as long as possible, when it looks like 'stability' is what is needed then they create stability until it looks like another crop of new adopters is ready to be lured in, to them BTC is like that Spartan army doing a simple 'charge', 'fallback (as little as possible) and 'hold' pattern, claiming 'ground' is the goal and ground is measured in exchange rates.

The question is now, can they keep this up?  And for how long?  I think it will eventually break them, the waning availability of new suckers, the exodus of China, and the declining profitability of mining hardware which will force more coins to flow into exchanges will exert enough pressure to break out of this ~850 band and bring a correction down to a more sustainable level.  Sustainable here simply meaning how much actual USD per day that libertarians can find out of their own pockets to throw at buying up the ~5k new BTCs per day that come into existence.  This should not be confused with the LONG term sustainability issue which involve a whole slew of legal and economic factors beyond the scope of just throwing USD purchases at BTC.  But for the short and mid term I feel we will see corrections in which small fry run for the doors but whales do not.

Double post. 'cause I got another nugget of wisdom for you guys.

All those walls of text about manipulation here and miner profitability there and how it all can only mean one thing: DOWN DOWN DOWN, or the bullish alternative: buy back now or the CHOO CHOO leaves without you... they're just noise. They miss one insight I recommend hammering into your brain, mantra like, until you *get* it...

What we've seen for the past 3 odd years follows one simple rule:

For the bootstrapping phase of a global, peer-to-peer {reserve currency, store of wealth, payment system} USD/BTC necessarily looks the way it does;

The way USD/BTC looks is not sufficient to guarantee the success of this becoming a global, peer-to-peer {reserve currency, store of wealth, payment system}.

That is all. If you convinced yourself of the above, many of your little nervous breakdowns will simply go away. You can still daytrade if that's what you do best, you can buy & hold (which means you bet on the long term success as described above), or you can close your positions and leave (if you have serious doubts about the success of Bitcoin in the fields described above). But you probably won't look at each minor swing and see dark forces at work pulling string at the expense of the "small guy", whether it's pulling price up or pushing it down.

In reality, this is what one of the most amazing social experiments during my lifetime looks like, in which a plethora of market forces attempt to participate in the experiment in order to fulfill their own highest ranked desire (idealism, greed, curiosity). It couldn't be any other way.

Double post. 'cause I got another nugget of wisdom for you guys.

All those walls of text about manipulation here and miner profitability there and how it all can only mean one thing: DOWN DOWN DOWN, or the bullish alternative: buy back now or the CHOO CHOO leaves without you... they're just noise. They miss one insight I recommend hammering into your brain, mantra like, until you *get* it...

What we've seen for the past 3 odd years follows one simple rule:

For the bootstrapping phase of a global, peer-to-peer {reserve currency, store of wealth, payment system} USD/BTC necessarily looks the way it does;

The way USD/BTC looks is not sufficient to guarantee the success of this becoming a global, peer-to-peer {reserve currency, store of wealth, payment system}.

That is all. If you convinced yourself of the above, many of your little nervous breakdowns will simply go away. You can still daytrade if that's what you do best, you can buy & hold (which means you bet on the long term success as described above), or you can close your positions and leave (if you have serious doubts about the success of Bitcoin in the fields described above). But you probably won't look at each minor swing and see dark forces at work pulling string at the expense of the "small guy", whether it's pulling price up or pushing it down.

In reality, this is what one of the most amazing social experiments during my lifetime looks like, in which a plethora of market forces attempt to participate in the experiment in order to fulfill their own highest ranked desire (idealism, greed, curiosity). It couldn't be any other way.

your incredulity is surprising.  I am indeed not a miner, I am an observer of miners and a student of macro-economics which puts me in a better position to predict the overall trends then an individual miner who thinks micro-economically.  First you confuse 'declining profitability' with 'unprofitable', as you said the unprofitable miner ceases to mine and the miners as a whole stay profitable but JUST BARELY.  And just barely profitable miners still have costs that need to be paid, so the percentage of your daily take that can be hoarded declines.  It is as simple as that.