Bitcoin - Part 2

[Samson]

If your algorithm calls “sell” on a 12% decline, I’m not sure how it can possibly work long term on such a volatile item. You might sell at 8902 and then miss a crazy climb to 12000+. If you are buying and selling all over the place, you will be eaten alive by the fees.

Except the Technical Analysis thread shows repeated predictive successes for the algo.
These guys are anti for no obvious reason. Not sure about Phiwum bit psion10 has laughed everywhere, which is no problem, just not logical.

 

[phiwum]

Except the Technical Analysis thread shows repeated predictive successes for the algo.
These guys are anti for no obvious reason. Not sure about Phiwum bit psion10 has laughed everywhere, which is no problem, just not logical.

Surely, you used this algorithm to predict $500 by the end of January, right? Of course there's been a significant downward trend, but nothing like you predicted.

 

[PartSkeptic]

Ah, but we will always have 'the nodes'

You reckon? Why? Why would someone maintain the ledger when they are not getting paid? Already the numbers are falling.

 

[PartSkeptic]

Such a negative approach.
How about, despite yesterday calling a sell at 8902 that immediately made a low of 7809, a 12.2% decline, your prediction of $500 bitcoin looks premature.

@phiwum
You (and I at first) misunderstood what he was saying.

He means that instead of what you said, you could have said to him that his prediction of $500 is premature.

 

[PartSkeptic]

Surely, you used this algorithm to predict $500 by the end of January, right? Of course there's been a significant downward trend, but nothing like you predicted.

It seems that there are forces at work trying to prop up the price.

As bubbles go, this one is more like puncturing a hot air balloon than a soap bubble. But I believe the descent will accelerate at some point as the hole gets bigger and bigger.

 

[Samson]

Surely, you used this algorithm to predict $500 by the end of January, right? Of course there's been a significant downward trend, but nothing like you predicted.

Direction is the aim of a TA algorithm, pretty much a holy grail. With the prodigious leverage available you can move fast.
Note the specific prediction I made at 8902 and evaluate. How far out of the money/how far into the money ratio.

 

[PartSkeptic]

I’ve been following the bitcoin saga from pretty close to the beginning. I bought 10 bitcoin in 2013 when it was about $15, IIRC. I sold about 7 bitcoin in late December when it was about $15000.

I initially bought it because I think there is utility in the underlying idea: A completely anonymous way to make purchases. No credit card trails, no bank statements, virtually nothing that can tie you to individual transactions. Plus, if it became widely used, it would make transferring money between people quick, cheap and simple. I could envision a time when online purchases were mainly done with bitcoin and it would become mainstream, even useable at B&M stores.

Largely, that vision has yet to come to pass. I used it here and there for about a year, noted the volatility and just kinda forgot about it. Until I saw a news report in late December, dug out my wallet (that’s a story in itself) and sold it all. That was an amazing day.

I still think there can be utility in cryptocurrency but not right now. There is way too many “coins” out there and way too much speculation. Not to mention scams.

I don’t think Bitcoin is going anywhere, but it won’t become a mainstream payment method until the market stabilizes.

One of the lucky ones. Congratulations. This round of beers is on you. I will send you my bank details. (Please pay in regular fiat money, not crypto. )

You realize your "winnings" on your "bet" come from the "losers" who bought when the price was above $15,000. And who will lose even more if they hold on, hoping for a turn-around. Where else could it come from?

 

[Samson]

@phiwum
You (and I at first) misunderstood what he was saying.

He means that instead of what you said, you could have said to him that his prediction of $500 is premature.

Yep, the old adage, if you can't think of anything nice to say.....

Thanks anyway. I do take seriously the algo predictions I post because these threads log permanently, and to be honest, I should have done everything I have posted. The exercise to audit is quick and inescapable.

 

[xjx388]

One of the lucky ones. Congratulations. This round of beers is on you. I will send you my bank details. (Please pay in regular fiat money, not crypto. )

A round of CryptoBeer for everyone! I’ll need everyone’s receive address...

You realize your "winnings" on your "bet" come from the "losers" who bought when the price was above $15,000. And who will lose even more if they hold on, hoping for a turn-around. Where else could it come from?

That is always true in financial markets. Winners and losers. I’m sure those people who paid me for my BTC were happy to do so at the time and I was surely happy to sell to them. They may end up losers OR they could end up being smart if another little blip sends it shooting to 25k. I don’t think it’s possible to predict with any certainty what BTC will do in the next 5 years: who predicted the 19k it hit in December?

Blind luck is all it was in my case. I cannot claim any expertise in financial stuff so all this technical analysis is way above my head. What I wonder is that if TA is so good at predicting the markets and all it takes is the right algorithm on a spreadsheet, why aren’t there more people beating the stock market? It seems to me that every fund manager/stock analyst/day trader would jump on that kind of info and get rich. Instead, we find that managed mutual funds don’t perform any better than indexed funds.

I kind of agree that BTC is way overpriced. I think the price is killing it’s utility. I don’t really understand why it’s so overpriced. But as long as people are speculating on it, the price is going to remain volatile and that could mean it falls hard, rises high and generally bounces around ... like we are seeing now. It could be $25k next month just as easily as it could be $250. I don’t think looking only at its price history with fancy algorithms is going to be able to predict which one it is.

 

[psionl0]

That is always true in financial markets. Winners and losers. I’m sure those people who paid me for my BTC were happy to do so at the time and I was surely happy to sell to them. They may end up losers OR they could end up being smart if another little blip sends it shooting to 25k. I don’t think it’s possible to predict with any certainty what BTC will do in the next 5 years: who predicted the 19k it hit in December?

Blind luck is all it was in my case. I cannot claim any expertise in financial stuff so all this technical analysis is way above my head. What I wonder is that if TA is so good at predicting the markets and all it takes is the right algorithm on a spreadsheet, why aren’t there more people beating the stock market? It seems to me that every fund manager/stock analyst/day trader would jump on that kind of info and get rich. Instead, we find that managed mutual funds don’t perform any better than indexed funds.

I kind of agree that BTC is way overpriced. I think the price is killing it’s utility. I don’t really understand why it’s so overpriced. But as long as people are speculating on it, the price is going to remain volatile and that could mean it falls hard, rises high and generally bounces around ... like we are seeing now. It could be $25k next month just as easily as it could be $250. I don’t think looking only at its price history with fancy algorithms is going to be able to predict which one it is.

What a wonderful breath of fresh air! I have never seen so much common sense in this thread!

 

[Eddie Dane]

What are the odds of Bitcoin having another run-up?

The Roubini article linked above says it will just go to zero (I disagree, it has a base of people who hold it for ideological reasons who will at least keep up some value).

An investor I follow on Youtube (and who always acknowledged that this is a speculation bubble) thinks it will go down to somewhere between 5000 and 3000 and then go into a new bubble phase.

But I see no reason why it would have another run. The price increase was not fueled by the utility of the coin, but by the psychology of the believers, the hopeful and the greedy.

My feeling is that to those low-information investors, Bitcoin has lost its magic. It came to their attention by way of mainstream media interviewing eighteen-year-old Bitcoin millionaires and they thought it would go to the moon.

Can anything bring back that expectation among the general public?

And don't underestimate the stupidity of a large part of the population. I've watched YT videos by people who lost their life savings in Bitconnect debacle. I don't want to be mean, but people followed financial advise from teenagers on Youtube FFS.

 

[psionl0]

I think the point being made is that it doesn't have a physical form, not that it doesn't exist at all.

I doubt that is the case but even if it were, it would highlight the need for a bit of technical nous. It is the concept of "ownership" and the difficulty of stealing that ownership which renders the non tactile form of cryptocurrency a plus.

You have to understand what is involved in finding the hash number for the ledger, how the ledger is constructed and distributed, what the constraints are in power and speed, what the capital costs are to mine and maintain, how ongoing costs per transaction are calculated, how secure the keys and the exchanges are. And so on.

You also highlight the need for technical nous. You may be able to sprout a number of technical buzz-words regarding cryptocurrencies but you can't explain them to the ordinary reader and you can't distinguish between the technical features that are important to know and those that are less important.

Add to that your knowledge of how supply and demand work and you get a total of .......

 

[Eddie Dane]

$7.835 on GDAX now, by the way.

 

[psionl0]

But I see no reason why it would have another run. The price increase was not fueled by the utility of the coin, but by the psychology of the believers, the hopeful and the greedy.

My feeling is that to those low-information investors, Bitcoin has lost its magic. It came to their attention by way of mainstream media interviewing eighteen-year-old Bitcoin millionaires and they thought it would go to the moon.

Can anything bring back that expectation among the general public?

You are partly right. As new speculators get burned and bad news stories circulate, the demand for cryptocurrencies will continue to fall.

If past patterns repeat themselves, once the nervous nellies have departed, you will be left with more hard core owners who know better than to be swept up in the panic. The bad news stories will subside and the stage will be set for another price resurrection. It is hard to say what may spark the resurrection. It may be a bad news story on the non-crypto front, some technological development that aids crypto circulation or it may just happen spontaneously with each price rise feeding on the previous price rise. All we can say for sure is that there will be a lot of new stamp collectors greater fools crypto purchasers ready to join the next speculative boom.

 

[Craig B]

One of the lucky ones. Congratulations. This round of beers is on you. I will send you my bank details. (Please pay in regular fiat money, not crypto. )

You realize your "winnings" on your "bet" come from the "losers" who bought when the price was above $15,000. And who will lose even more if they hold on, hoping for a turn-around. Where else could it come from?

The last to arrive at the bar pays for everyone else's drink. But each person arriving doesn't know if someone will turn up even later and pick up the bill.

 

[psionl0]

The last to arrive at the bar pays for everyone else's drink. But each person arriving doesn't know if someone will turn up even later and pick up the bill.

So nobody else will ever buy bitcoin again? That is a terrific psychic insight you have there.

 

[Craig B]

So nobody else will ever buy bitcoin again? That is a terrific psychic insight you have there.

You're telling me that the last person has already arrived at the bar. As I've said before, nobody knows that, and it can't be known, even by those lucky people who have psychic insight. It becomes known only in retrospect.

A "greater fool" turns up with his credit card at Coin Mama's Bar. The drinks are on him if nobody turns up after that. We can guess that he's the last if, and only if, there is a crash just after his belated arrival, that would deter even the "greatest fool" on earth from attending the festivity.

That's how it works.

 

[ponderingturtle]

I kind of agree that BTC is way overpriced. I think the price is killing it’s utility. I don’t really understand why it’s so overpriced. But as long as people are speculating on it, the price is going to remain volatile and that could mean it falls hard, rises high and generally bounces around ... like we are seeing now. It could be $25k next month just as easily as it could be $250. I don’t think looking only at its price history with fancy algorithms is going to be able to predict which one it is.

For utility wouldn't it need to be cheaper and faster to confirm trades?

 

[Craig B]

It is the concept of "ownership" and the difficulty of stealing that ownership which renders the non tactile form of cryptocurrency a plus.

If it's impossible to steal Bitcoins that's certainly a plus, but is that true? However if it's impossible to steal them because the concept of "ownership" of them is poorly defined, that's a minus.

 

[ponderingturtle]

If it's impossible to steal Bitcoins that's certainly a plus, but is that true? However if it's impossible to steal them because the concept of "ownership" of them is poorly defined, that's a minus.

And yet there have been many large thefts associated with bitcoin. And being hard to steal isn't terribly important if it isn't actually useful for something.

I am going to continue to invest in commemorative plates, those things are guaranteed to increase in value after all.