Topic: Warning: How many of you Bears have ever been a victim of a Short Squeeze? - page 30. (Read 43772 times)

i would advise you to keep a VERY tight leash on all those kids shorting Bitcoin.  if you don't they could take your exchange down.

i truly hope you're short.  hold onto those shorts please; the pain will stop soon (maybe).

Short squeeze is on?

Fantastic little bitcoin bot fight on MtGox at the moment.  Rapid fire trades with large swings every second.  My bot made 25 profitable trades during that time.  Keep it up  

Honestly, the Bitcoin community is still very much an insular geek village.  That'll change but not now, not yet.  The current "rally" is clearly the manipulator.

let me make you aware of other developments going on in the general economy that most of you here who don't study economics like i do aren't aware of that will promote more USD movement into Bitcoin:

1.  the USD has resumed its fall which will lead to a resumption of speculation into stocks, commodities and Bitcoin. 
2.  we are seeing a rise in the stock market despite all of the bad news b/c the risk on trades are resuming
3.  there is a US Treasury selloff occurring which is generational.  this is going to free up trillions of USD's that have to move into other investments.
4.  gold and silver are faltering as well and will be a source of new USD's looking to move into the next big trade:  Bitcoin.

the SHORT SQUEEZE is here.

This rally is BS...

LOL!  well it took all of 2d to get the short squeeze going.  CHARGE!!!!

The rest is transferred between users internally.

Bitcoinica is 0% bucket shop.

 *grins evily*

  I wouldn't, only because I would feel atleast a little bad for anyone losing money in such a manner.  Though I am not much of a short player in real life game, I prefer my dividend bearing energy stocks that stay at a predictable rate of increase year after year, I definetly would not touch a short on Bitcoin at any where below 4-5 bucks. ever. Its suicide... Now, back when it was on the 16 slope I can be quoted as 'I just wish we had a way to play short on this'(give or take a few letters), and then sure, why not. It was pretty obivous the investor types were growing more and more uncomfortable.

  Cheers

One thing about this dip into the $2.xx range is that it brought out a metric ass-tonne of negative media attention.  It was strange to watch, but suddenly all of the online media called the death of Bitcoin.  If that's not a sign that the bottom is in, I don't know what is.

Actually, might one be happening now?  How can you tell for sure?  I would think that you'd see a cascade effect, where one person gets squeezed, which pushes up the price by $0.10, which sets off another short squeeze that pushes up the price further, and which repeaters until all the shorters have been cleaned out?

It looks like short squeezes are in play.  Bitcoin low was $2.05 at one point, and at 5:1 leverage, short squeezes could have started happening at $2.46.  Price now at $2.48 and rising...

I'd love to see one happen just for S&G. 

"As defined by the U.S. Supreme Court a Bucket shop is "[a]n establishment, nominally for the transaction of a stock exchange business, or business of similar character, but really for the registration of bets, or wagers, usually for small amounts, on the rise or fall of the prices of stocks, grain, oil, etc., there being no transfer or delivery of the stock or commodities nominally dealt in."(from wikipedia)

If 60% of trades are hedged - ie, the underlying security is transferred - then it's only 40% bucket shop?  I'm no expert, but I think anything over 0%, and you would be considered a bucket shop for regulatory purposes.

Bitcoinica is not a bucket shop. Our volume at Mt. Gox is over 300,000 BTC for the past 30 days. More than 60% of Bitcoinica trades have been hedged.

I have no incentive to take the risk. We are already making more profits than any exchange from the spreads, it's never wise to trade against Bitcoin traders, who can be assumed to be more open minded than average traders.

This is a funny thread.



First of all

Bitcoinica by all measures is a bucketshop, the people playing there are playing against bitcoinica. No matter WHAT they say they are a bucketshop just like a huge majority of forex brokers facing the USA

So people shorting bitcoin over at bitcoinica has no effect on market price.



Moving on,

Bit coin is NOT the stock market, There are no bulls ready to set off a massive rally and there are no bears ready to plunge it again. It is simply a few holders with large amounts of coin who decide to buy/sell their coins all at once and people will jump on the trend and the lower it goes the more speculative interest goes right out the window.




I swear to god these boards sound like penny stock boards, you know where the stocks go from $50 to $0.5 and people are still holding because one day it will "return to the good old days"

I love the people throwing out technical analysis(very poor TA btw) and think it relates to bit coin.



hah..

This is where I wonder more and more about the cognitive disconnect people have about bitcoin. There are so many pumpers around here, lamenting short-sellers. In any normal market, we would all be saying "great!" to short-selling; it's responsible for the revelation of true prices in the face of overblown hype (longs being the opposite in terms of excessive pessimism). However, the negative sentiment towards shorting around here tells me that people really do know (or at least feel) the risks of low USD/BTC exchange rates: attack vulnerability, failing exchanges, and massive market manipulations by average people. It's kind of like everyone knows that downward price pressure really increases the risk of full-blown failure, and so the opposite "it will never die, (screw short-sellers!)" mentality has to surface for self-preservation by long-position holders.


Well, you're not totally right on that. Effective short-term shorting requires low volatility, and as instant-as-possible trading. Neither of those exist for BTC. In addition, the most convenient way to short is Bitcoinica, and they are a brokerage, so your activities there are not reflected immediately in the exchanges. They could be aggregating all kinds of movements in whatever direction their hedging algorithm dictates at the moment through many small trades, or single large ones.

With that layer of opacity (and market power) between your trades and the exchanges, it's a difficult argument to say that shorting BTC really is improving fundamental price discovery. Mr. Z can state his intentions all he wants, but the fact is he can act as a market maker at any point.

Again, I think most people at least feel this, if not know it explicitly about bitcoin: falling prices are a serious risk for the sustainability of bitcoin.

The animosity towards shorts is understandable, but I am about 80% confident that the recent crash was not caused by shorts, but  a big dump from a long holder who decided to flounce away from the bitcoin scene.  I am by no means a skilled trader, but  I would assume that the most effective short strategies involve relatively short-term positions, and contribute very little to overall price movement.

It's already been said, but how can you trust anything about the order book, considering how long you've been here? There is absolutely no reason to believe anything of substance is sitting in that wall.


And long. The direction of the position isn't important here; it's holding on margin. Those swings + spread + how high you let your maintenance get is what makes volatility so dangerous here.

I agree with cypher.
It is not about if, but when a short squeeze or short term big bounce up happens. Sentiment is perfectly set up for it, as most people firmly believe they can get bitcoin much cheaper, and will be surprised if the market runs away from them..

  makes good fertilizer? ;p