Topic: What price are you going back in at? (Read 3074 times)

Of course I am. There have to be people doing it, so that the rest of us can buy low, sell high!

Do you mean to say that you aren't familiar with the validity of that strategy?

Somebody has to buy high, sell low!

I'll only get back in when it gets above $30.

Actually, that's a lie, but nonetheless, it would be a valid trading strategy, as counter as it may seem.

There is no competition for bitcoin now - but I would like to see something less wasteful.  Maybe with a bit of compromise on the decentralization requirement (which is in any case only partially meet by bitcoin - I am sure you've seen the latest Ben Laurie post).

Or maybe there is a competition - http://ripple-project.org/

Your example is illustrative actually of my point.  pets.com was 30% backed by Amazon.com. The underlying Internet economy grew and Amazon continued to grow with it.  Pets.com was a niche product company that overspent on advertising; a consequence of being late to the party.

Your point would be more relevant if there were competitors to bitcoin - some of whom might be expected to fail.  But there are no competitors to bitcoin. It is simply good enough to capture the market for an efficiently traded, secure, electronic currency that provides a disruptive alternative to the bloated-fee payment mechanisms such as credit cards, and provides an inflation-resistant means of measuring economic value.

Yeah - but for all we know bitcoin can be pets.com instead of AMZN.

At $14 now. Is it false upsurge, test spike, or a real rally?

All indicators point to a buy-in. Think I will sit it out and learn from this one.

Stew

Well I see going below 5 dollars the end for bitcoin because of the short history, the news, the wave it was riding, hitting over 30 bux a coin, the difficulty to mine, people selling there mining rigs, there graphics cards on ebay for mining etc.  Bitcoin should not be worth less then 5 bux, if it drops below, I dont see it coming back, most people that were on the bubble and just learning about it, and getting excited are now scared of bitcoin because of this instability, which will not help the prices.

BUY and hold (or use) if the price goes down BUY some more and hold (or use)

No I think that mining difficultly lags the price increase, in that rapid price increases spur miners such as myself to add rig capacity.  The reason that I think a leveling off or a decline in mining difficulty marks a post-bubble  bitcoin price bottom is because miners got very excited during the bubble run-up and I expect them to be less excited - perhaps to the point of disenchantment - during the post-bubble decline.

Bitcoins are not headed towards oblivion in my opinion. The bitcoin economy must be distinguished from the bitcoin bubble.  By way of analogy, consider Amazon. http://finance.yahoo.com/q/bc?s=AMZN+Basic+Chart&t=my

During the Dot-Com bubble AMZN soared from a low value to around $100 per share, as traders generally projected the expected Internet economy and Amazon's central role in that Internet economy.  When the Dot-Com bubble deflated, Amazon's stock price sunk by two thirds or more, yet their participation in the Internet economy proceeded anyway.  Now in the fully post-dot-com-bubble Internet economy AMZN is trading at $213.  The point I am making is that the bitcoin price bubble is simply characterized as traders getting way ahead of themselves - eventually the bitcoin economy will get there too.

I believe that ultimately, the price of bitcoins will closely correlate with the size of - and fluctuations of - the bitcoin economy, which one might define as routine commerce transactions among merchants, consumers, and miners.  The bitcoin economy will probably feel the bitcoin price bubble to some extent, but I expect it to keep growing as the advantages, e.g. efficiencies, of bitcoin transactions spread their way into the worldwide financial mainstream.

Excellent analysis.  Do you see the mining difficulty as being the most important factor affecting price?

If miners lose interest and sell their rigs, is BTC ultimately headed for oblivion?

What of the BTC already mined? Is there any residual value in this crypto currency?

Thanks for your insights,
Stew

I smell fear....

Why do you surmise $5 as the make or break for BTC? Past history?

Curious, thanks.

Stew

All in with my 10 bitcoins are a threat? 

What power I have, I have made fire !!!

Also NMC prices go up when BTC prices fall, so it's a good bet if BTC prices are falling.

I bought namecoins with my stash.  I think the whole namecoin DNS idea is dumb, but otherwise, namecoins are just bitcoins that don't have 6 million out there full of early miners waiting to cash in and start their rich lives, and currently aren't tanking like bitcoins are.

There are only about 760,000 namecoins in circulation - 106 days worth of mining - and a far higher percentage of those are actively trading on the market compared to BTC.  No need to worry about someone hoarding them all and needing others to pay for them to be millionaires/billionaires later, as in another 106 days, circulation will double, and 106 days after that, it will triple.  Anyone's current NMC holdings will be reasonably diluted.

I liquidated my 12 month mining hoard at $15.5 and will get back in when the bubble fully deflates.  Sentiment has to be very negative for the bottom to set in, and expect premature false starts on the way back up.  

Examples of negative sentiment would be

• mining difficulty - slower growth, leveling off, or decline
• miners selling their rigs
• long time hoarders cashing out at very low prices and giving up on bitcoins
• ASIC developers postponing their mining chip development due to unfavorable economics
• continued decline in the Google Insight popularity of "bitcoin" searches
  
• forum posts arguing that price watching/obsessing is not important

I plan to investigate bitcoin economy indicators to see if there is a way to predict bitcoin value due to merchant/consumer/miner activity.

I will buy them if they hit 5$, if they go below that again, bitcoin is finished.

$6 and $10 - somewhere in there is a happy number.