USD Swap demand on Bitfinex has never been so high - page 3.

CEG5952

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Buy and sell bitcoins,

Quote from: Tzupy on June 20, 2014, 10:48:20 AM

Total sum of active $ swaps is still 25M$, just below the peak, average rate has dropped.
I don't know, is BFX supposed to have all the $, or can they operate with a fractional reserve (this may be a silly question Roll Eyes

)?

Well, all that money is supposed to be in the "deposit" accounts of lenders. After the contract is up, you are free to move the money..... so I certainly hope no fractional reserve.

keithers

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This is the land of wolves now & you're not a wolf

Quote from: TERA on June 20, 2014, 07:24:40 AM

I just point out TA, patterns, and fractals. No agenda. If technicals were more bullish, my charts would be too. KEep in mind also they are not predictions but possibilities. There is a possibility also of a rally, if the right events develop.

Not that it matters either way, but are you a man or woman? People around here are speculating...

For the record though, you were pretty accurate on the latest market correction after this most recent rise to near $700 (and back down), I remember reading it as we were near the top..

MatTheCat

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Quote from: Tzupy on June 20, 2014, 10:48:20 AM

I don't know, is BFX supposed to have all the $, or can they operate with a fractional reserve (this may be a silly question Roll Eyes

)?

No! Not Possible!

The Bitfinex exchange operators, with access to all BFX trader positions, stop losses and limit orders, and with absolutely no regulatory oversight, would never dare to start trying to Jimmy the numbers and/or operate fractional reserve systems in order to multiply their profits by an order of several magnitude. Only bad exchanges like MtGox would even dream of attempting to dabble in those sort of black arts!

TheJuice

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The argument that bitcoin is being held up by borrowed money in false. I am planning money, money id otherwise have in btc.

Tzupy

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Total sum of active $ swaps is still 25M$, just below the peak, average rate has dropped.
I don't know, is BFX supposed to have all the $, or can they operate with a fractional reserve (this may be a silly question Roll Eyes

)?

MatTheCat

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Quote from: MoreFun on June 20, 2014, 08:58:57 AM

TERA if there would be a lot of demand for shorting BTC would you think this is bullish?

BTC shorts are generally maxed out at or approaching bottoms. Go see for yourself:

http://www.bfxdata.com/bitfinexLiquidityBTC.php

oda.krell

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Quote from: Miz4r on June 20, 2014, 09:45:36 AM

Quote from: oda.krell on June 20, 2014, 09:11:46 AM

Quote from: Miz4r on June 20, 2014, 09:03:45 AM

Quote from: oda.krell on June 20, 2014, 08:52:42 AM

More relevant imo is a historic comparison like active swaps and average rate of active swaps. And that view, despite what some bulls in here like to think, is slightly bearish, with USD swaps pretty much maxed out.

Why would that be slightly bearish? I think it's neutral, but maybe I'm missing something here so I'm willing to learn. I just don't see the connection knowing only this piece of information.

Sure, I don't mind explaining how I arrive at that conclusion. I'm not an expert on reading swaps, but my perspective on them is as follows: I read this one similar to spotting divergences on a price derived indicator -- the "divergence" here is that price is falling, or at least stagnating, but USD swaps make new highs. In my experience, this is an early bearish signal. Example: February 6 this year.

But price isn't falling? We corrected to $537 and even $522 on Finex because of margin calls. USD swaps actually went down during that correction by a few million USD. Then the price started rising up to $610 again together with USD swaps, and now we're consolidating/flagging in $580-610 area until we see another breakout. The most likely way forward looking at the technicals here is a continuation of the trend, which is upwards. I don't think I can agree with your reasoning here that the number of USD swaps is a bearish indicator, but good luck if you decide to trade based on this.

I didn't say anything about trading based on this. It's a small piece inside a larger puzzle, and I am slightly more bearish as a result of it. That's all.

The USD swap peaks I mean are on June 18 (crossing 26M USD), with price at the time ~$80 below the $680 top. Like I said: I think of it as a "divergence". Not the same as a stand-alone sell signal (which rarely exists anyway Cheesy

)

Miz4r

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Quote from: oda.krell on June 20, 2014, 09:11:46 AM

Quote from: Miz4r on June 20, 2014, 09:03:45 AM

Quote from: oda.krell on June 20, 2014, 08:52:42 AM

More relevant imo is a historic comparison like active swaps and average rate of active swaps. And that view, despite what some bulls in here like to think, is slightly bearish, with USD swaps pretty much maxed out.

Why would that be slightly bearish? I think it's neutral, but maybe I'm missing something here so I'm willing to learn. I just don't see the connection knowing only this piece of information.

Sure, I don't mind explaining how I arrive at that conclusion. I'm not an expert on reading swaps, but my perspective on them is as follows: I read this one similar to spotting divergences on a price derived indicator -- the "divergence" here is that price is falling, or at least stagnating, but USD swaps make new highs. In my experience, this is an early bearish signal. Example: February 6 this year.

But price isn't falling? We corrected to $537 and even $522 on Finex because of margin calls. USD swaps actually went down during that correction by a few million USD. Then the price started rising up to $610 again together with USD swaps, and now we're consolidating/flagging in $580-610 area until we see another breakout. The most likely way forward looking at the technicals here is a continuation of the trend, which is upwards. I don't think I can agree with your reasoning here that the number of USD swaps is a bearish indicator, but good luck if you decide to trade based on this.

Joe200

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I don't get it. The average rate on active USD swaps is actually pretty low. Doesn't that mean that the supply of USD that can still be lent is high? So not bearish.

oda.krell

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Quote from: Miz4r on June 20, 2014, 09:03:45 AM

Quote from: oda.krell on June 20, 2014, 08:52:42 AM

More relevant imo is a historic comparison like active swaps and average rate of active swaps. And that view, despite what some bulls in here like to think, is slightly bearish, with USD swaps pretty much maxed out.

Why would that be slightly bearish? I think it's neutral, but maybe I'm missing something here so I'm willing to learn. I just don't see the connection knowing only this piece of information.

Sure, I don't mind explaining how I arrive at that conclusion. I'm not an expert on reading swaps, but my perspective on them is as follows: I read this one similar to spotting divergences on a price derived indicator -- the "divergence" here is that price is falling, or at least stagnating, but USD swaps make new highs. In my experience, this is an early bearish signal. Example: February 6 this year.

HeliKopterBen

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Quote from: adamstgBit on June 20, 2014, 09:01:31 AM

if bitfinex was more trusted, we would see the sawp demand fulfilled, not saying bitfinex is not legit or trustworthy, but i'm sure the shady look and feel to the bitcoin exchanges is holding back alot of money.

Good point. The silk road coins auction will likely be a better indication of real demand, especially by larger, more established players... it depends on how close to spot those coins are sold.

Miz4r

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Quote from: oda.krell on June 20, 2014, 08:52:42 AM

More relevant imo is a historic comparison like active swaps and average rate of active swaps. And that view, despite what some bulls in here like to think, is slightly bearish, with USD swaps pretty much maxed out.

Why would that be slightly bearish? I think it's neutral, but maybe I'm missing something here so I'm willing to learn. I just don't see the connection knowing only this piece of information.

adamstgBit

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Trusted Bitcoiner

if bitfinex was more trusted, we would see the sawp demand fulfilled, not saying bitfinex is not legit or trustworthy, but i'm sure the shady look and feel to the bitcoin exchanges is holding back alot of money.

MoreFun

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WePower.red

TERA if there would be a lot of demand for shorting BTC would you think this is bullish?

BuildTheFuture

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Quote from: nick32768 on June 20, 2014, 04:39:35 AM

Currently there are 11.8 Million dollar of USD swap demand, and only 1.1 Million of offers.

http://www.bfxdata.com/

Is this bad or good ?

Nick.

I'll go out on a limb and guess good. If you look at the longer term history of total USD swaps at the site http://www.bfxdata.com/, back during the bitcoin price jump last year the USD swap amounts outstanding were pretty much continuously hitting new highs. The higher interest rates attracted more and more USD lenders and this IMO partially fueled the overall bitcoin price rise. So I'm hoping to see something similar happen here and the interest rates and swap demand stay high enough to suck in a bunch more USD lenders.

oda.krell

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I wouldn't read too much into it: the direct comparison of swap demand vs. offer is just a snapshot, so it's difficult to put it in context. Or am I missing how to get a historic view of it?

More relevant imo is a historic comparison like active swaps and average rate of active swaps. And that view, despite what some bulls in here like to think, is slightly bearish, with USD swaps pretty much maxed out.

Add to that a falling average return rate (better view perhaps by looking at FRR). Approaching a low point that we last saw ~10 days ago, shortly before the drop from ~650 to ~550.

ShroomsKit

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"No agenda"

Hilarious.

I'm seriously wondering if he's trying to fool himself or us at this point.
Either way it looks amazingly stupid.

Miz4r

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Quote from: TERA on June 20, 2014, 07:24:40 AM

I just point out TA, patterns, and fractals. No agenda. If technicals were more bullish, my charts would be too. KEep in mind also they are not predictions but possibilities. There is a possibility also of a rally, if the right events develop.

You often stress the bearish possibilities and ignore the bullish ones or mention them very briefly as if unimportant. Also you say the demand for USD loans is a bearish indication which is false and you should know that. The current technicals aren't bearish at all, just because the recent correction went a bit deeper than you initially thought (disregarding Chinese exchanges) doesn't mean the entire uptrend from $340 is over now. We saw the same pattern after the initial spike from $340 to $548. I can even see bullish divergences forming on the shorter timeframes, so your bearishness looks all in all very biased and one-sided to me.

thezerg

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Quote from: TERA on June 20, 2014, 07:24:40 AM

I just point out TA, patterns, and fractals. No agenda. If technicals were more bullish, my charts would be too. KEep in mind also they are not predictions but possibilities. There is a possibility also of a rally, if the right events develop.

Tera just to point out your bias, notice that you did not respond to the piece of data that the OP highlighted and do not seem to be aware of that. Your comments refer to the fact that a lot of USD has been borrowed on bitfinex ($25M). However the OP was talking about the DEMAND for borrowing, which also looks like it is quite high ($12M). A high borrowing DEMAND is clearly bullish, whereas a high borrowed amount is open to interpretation. Its bearish because as you have pointed out at some point these positions need to be unwound which could put a lot of coins on the market, assuming the borrowing was used to purchase coins -- bullish if you believe in the wisdom of the crowds.

Hyena

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The lending part is pretty interesting concept. Of course there are a lot of people by now who think that they should borrow money to buy bitcoins. Now they are waiting to break even and the only way for them to default would be a longer than expected consolidation. The lenders must feel uncertainty and fear before they turn successful, otherwise it would be too easy.

A whale who knows that a lot of bitcoins have been bought with borrowed money will keep the prices down until the lenders are under water and forced to start paying back the loans. When lenders have turned unsuccessful a new rally begins as it is now profitable for the whales.

Topic: USD Swap demand on Bitfinex has never been so high - page 3. (Read 9398 times)