Topic: The recovery in one picture, or: why bulls shouldn't salivate too much yet (Read 3152 times)

 

I think they probably just have it in for you

Take a look at the negative divergences all lining up at the moment:

https://bitcointalksearch.org/topic/m.7372816

I guess the bottom line is that 95% of people buying Bitcoin are buying it with the sole interest of having someone else who is willing to buy it back at a higher price at some point in the future. Bitcoin is a game of catch the momentum and then avoid the swingback that traders are playing, which is all held together by the belief that at some point in the future, Bitcoin is going to actually be a useful and reliable commodity to the masses. Without any real surge in demand for Bitcoin for it's practical uses, then the overall trend in Bitcoin is going to be regressive, as an asset dominated by speculators is going to be a zero sum game and thus destined for ever decreasing cycles until some kind of external impetus comes into the market. Just look at practically every single ShitCoin out there. Speculative flash boom followed by relatively slow and grinding bear market as volume and value of the coin dwindles away to nothing.

In April 2013, we had the Cyprus bank bail-ins, which apparently was responsible for the $10-$266 bull-run. Then in November 2013, we had the China craze until the PBOC gave Bitcoin a disapproving grunt. Again, the big attraction of Bitcoin to Chinese investors is that it is/was an easy means to bypass their countries stringent capital controls and get wealth out of the country. The last truly insane bout of Bitcoin buying I remember was back in early March 2014, when within the space of one day, the day in between the Ukrainian Hyvrnia looking as though it could turn to dust and the EU/IMF offering a $17 Billion bail out, Bitcoin rose over $150 in one single day, the vast majority of it occurring during Eastern European Office hours. In otherwords, the big recent bull-runs that have required a significant amount of capital injection have all coincided with some kind of panic capital flight activity/planning........or was it all really down to Traderbot Willy?

As horrible as it is to say it, as far as another parabolic bull-run goes, Bitcoin needs a capital flight event. Increased merchant adoption is all very well for the long long term acceptance, propagation, and use of Bitcoin, but considering the already wildly over extended market, increased adoption is actually bearish event in the short term. What every single troll on this forum subsection is wanting is another massive injection of fast cash. Capital flight is the only feasible source of what the Bitcoin community are looking for.


When is the last time that you have tried to move money onto Stamp?

Ok Mr Bett, we have received your request to transfer 50p onto your Bitstamp account. Unfortunately however this transaction exceeds some of our limits and we are therefore going to have to ask you for:

Your tax reference code and tax return forms.
Proof of how you earn your money.
Receipts of any computer equipment you may have used for mining.
A short history on how you first heard of Bitcoin, 2000 words will suffice, English US spellchecked.
Why do you want to buy Bitcoins.
What do you plan to do with your Bitcoins.

Seriously!

They did when i signed up to them a few months back, same requirements as stamp. passport, utility bill etc

Just how many more corrections does the market need? We're already down a lot from previous mini-rally and at the low side of the fibonaci fans. I don't think your conclusion is wrong but i just wonder why the market wants so many corrections even with all the good news and also the timing is about right for the next rally.

It just feels too bearish atm.

They would never completely decouple, because there will always be market makers arbitraging between Finex and Stamp. But it's true that if people think they're seeing a sudden thinning out of the order book that there may still be some BFX - Stamp routing going on behind the scenes. Rapheal has refused to clarify beyond vague descriptions of a gradual decoupling, so maybe there is some way that they are amping their own arbitrage/routing down, eg by keeping lower balances on stamp and topping up less frequently.

+1

Synchronous LARGE trade orders listed on Bitfinex, can still be seen going through Bitstamp when the market is really moving.

Probably this is the reddit post you have in mind. You'll note how he doesn't say that they completely discoupled. In fact, about 3 weeks ago, there were signs that during high volume periods, that link might still be active - see the discussion in the wall thread

Up until a few weeks ago Bitfinex used to route some of their orders to Bitstamp, but they announced recently they have grown to the point that they feel ok in completely stopping that. I guess they might have been gradually tailing it off before that. But as of 2-3 weeks back, they are now totally separate. They announced this in a comment on reddit, sorry don't have the link handy.

The one exchange that actually says "Lube up!" when you submit for a KYC? At least they used to. TBH I didn't notice any difference in their KYC proceedings, what did I miss?

Kraken....

....and from their, I can transfer BTC to where I want. But if I was dealing with any kind of volume, then Kraken wouldn't be an option for getting funds into Bitcoin land......

......and also often, the premiums on LocalBitcoin (GBP) are pretty much equivalent to spot on the exchanges these days.....must be a big supply of BTC making their way onto UK LocalBitcoins. When I used to buy my BTC from LocalBitcoins, there was always a hefty 5-6% premium as a bare minimum to be paid over exchange rate.

Edit: And it just isn't the case that 'they are all the same'. Bitstamp used to request, proof of ID, verification of address, and locked the account to accept payments from the registered bank account only. In that sense, it is just like all the rest. These days, Bitstamp want to stick a stethoscope up the traders ringpiece. They want me to provide them with tax returns, proof of where my funds originally came from etc etc. It is like these boys have had the wind put right up them and they don't know how to properly behave, so are excercising caution to an extreme. Really, it is like they just don't know what they are fucking doing.

In that case you are pretty restricted in your trading, since all the big ones use similar procedures. There's only the pseudonymous Russian one left for you.

I can't get any fresh fiat directly onto Stamp, because I refuse to submit to their KYC procedures. I suspect that this has slowed the flow of fresh capital onto Stamp.

Not sure I get your point. The order book history I posted doesn't denominate ask sum in USD. It's misleading perhaps that the two are shown in the same chart, just imagine them to be in two different ones. The point I made isn't affected by that.

I disagree. Real volume analysis right now is difficult without some form of aggregating over exchanges, but if you'd have to pick any one exchange, I'd always take stamp. The main reason is that their volume is consistent and transparent. Bitfinex still refuses to distinguish between routed volume and in-house volume, so I know it is inflated, at least on days when they have to route to stamp. How often does that happen? Anyone's guess.
Chinese volume is tricky because of zero fees. I've said more than once: I don't dismiss it entirely as "fake", but I certainly don't count it 1:1 either. So stamp and btc-e are left, and in my opinion, btc-e rarely if ever starts larger moves, so picking stamp is (still) the default choice for me.

How do you calculate selling pressure?

I think total buy sum is pretty straightforward, because there is a fixed amount of dollars at the exchanges, and if these dollars are in the orderbooks they should be visible there.

But the sum of all sells nominated in dollars, what does that mean? Given that a lot of people store their bitcoins at the exchanges (which we've seen again and again), and a lot of them would put down "yeah, I'll sell for 10k", calculating the dollar sum of all asks would give an inflated value.

Bitstamp lost market share? I wasn't aware of that. I thought volume declined all accross the board. Who gained market share?

Bitstamp's fee structure isn't really that bad.  It advances about 10 times faster than gox's old fee structure did.

Bitstamp lost market share because:

-outrageous fees
-ridiculous fee structure (https://bitcointalksearch.org/topic/bitstamp-tx-fee-exploit-fee-116-instead-of-02-bitstamp-fixes-on-may-15th-597647)
-fears that Bitstamp could become the new MtGox (BTC withdrawals delays, invasive info for fiat withdrawals, the audit with Mike Hearn was suspicious, etc.).


Traders still refer to Bitstamp for TA because it has historical chart data from 2011 until today, though.

I find that the Bitstamp charts are a much better market barometer than Bitfinex. Bitfinex charts are full to the brim with margin traders switching positions every 5 minutes with erratic spikes and dips that come about due to margin calls in a thin market with very often illusory Ask/Bid wall depth. I have never witnessed Bitfinex take the lead in any direction and the rest of the market follow. On two occasions at recent top of market, Bitfinex broke to upside, Huobi and even BTC-e followed, but Bitstamp never budged. Bitstamp spent the following few days below the average spot price of all other exchanges, but in the end, Bitcoin went the way of the Bitstamp charts.

And I concur. The market right now is being held up more by a lack of willingness to sell other than by buying pressure/support. There are a 101 different indicators which could be used to paint a similar picture as your Bid/Ask ratio graph. The more I look at it, the more short term bearish I am becoming. I think a correction down to mid/upper $500s in the first instance is looking increasingly more likely than even a move up to $630.

Valid point about Bitstamp's reduced market share. The order book picture is much less clear on Bitfinex, with much wilder swings in either direction. I suspect that's because of the possibility to trade (and fill the order book) on margin.

In any case, the order book history is only one possible "snapshot" of the situation. Daily Chaikin Money Flow paints a similar picture, as does volume, which is anemic compared to volume during the bear market.