How To Use Bitcoin – The Most Important Creation In The History Of Man

[remirol]

good luck trying to bribe your border guards in the digital version after an EMP strike

We should probably keep the Bitcoin and doomsday-prepper threads separate, don't you think?

 

[kevsta]

We should probably keep the Bitcoin and doomsday-prepper threads separate, don't you think?

Aren't they classified in the same group by Homeland Security?

and it doesn't have to be a doomsday scenario, much of the world is subject to power failures and rolling blackouts from time to time. it strikes me that it wouldn't be much use to you in those places.

 

[Wildy]

None of that addresses your apparent belief that this is the way it will be for ever more.

Now you're just putting words in my mouth.

 

[wrs]

There is no comment so ignorant that the fools won't constantly repeat it as if they knew what they were talking about.

Bitcoin is already back over $1000. The best thing for wrs is if this thread gets merged with the main bitcoin thread so it won't be a constant reminder he is the lastest psychic to prematurely predict the demise of bitcoin.

Stuff always bounces in a correction. Here is a chart with support and resistance levels. I had seen 910 as a reasonable low yesterday but it overshot. That isn't good for bitcoin lovers because now $838 is calling and eventually, $910 won't be support. For now, $1000 is a round number and could work as support or resistance. $1050 is overhead resistance and $910 is lower support. It could trade in that $150 range for a while. Wouldn't hurt it a bit to do that either. It might gain a little stability but still, it's very expensive for what it is and it's daily moving averages are way back below where it sits right now.

What bitcoin lovers need to worry about is more heavy volume. It looks to me like bitcrashes are happening on heavy volume and bitbounces are on much lower volume. I think the sellers are the dominant force now based on the volumes but we will see, TWT.

 

[kevsta]

Stuff always bounces in a correction. Here is a chart with support and resistance levels. I had seen 910 as a reasonable low yesterday but it overshot. That isn't good for bitcoin lovers because now $838 is calling and eventually, $910 won't be support. For now, $1000 is a round number and could work as support or resistance. $1050 is overhead resistance and $910 is lower support. It could trade in that $150 range for a while. Wouldn't hurt it a bit to do that either. It might gain a little stability but still, it's very expensive for what it is and it's daily moving averages are way back below where it sits right now.

What bitcoin lovers need to worry about is more heavy volume. It looks to me like bitcrashes are happening on heavy volume and bitbounces are on much lower volume. I think the sellers are the dominant force now based on the volumes but we will see, TWT.

we appear to have different price levels but on BTC-E charts this is still in the middle of a decent uptrend channel, and "crash" isnt really relevant for fairly standard channel tracking action?

or what is the opposite of a Bitcrash then? and does a crash count if it just takes the top 25% off again after a 1000% rise?

IMO this isnt in technical trouble until the $715 level fails convincingly

 

[wrs]

we appear to have different price levels but on BTC-E charts this is still in the middle of a decent uptrend channel, and "crash" isnt really relevant for fairly standard channel tracking action?

or what is the opposite of a Bitcrash then? and does a crash count if it just takes the top 25% off again after a 1000% rise?


IMO this isnt in technical trouble until the $715 level fails convincingly

There are some other issues at play as well. First of all, your channel is way too wide, it appears to be plotted on a log scale and ignores the daily chart. You need to take a look at the daily and note that the 50dma is 497 and the 20dma is at 797. You have a chart of a blowoff run there with channels drawn in. That is unrealistic in the extreme. Those ma's on the daily will be tested and the 200dma is down around 200. Of course maybe bitcoin will be some kind of exception to the rule but your channel is a blowoff run IMO.

 

[kevsta]

There are some other issues at play as well. First of all, your channel is way too wide, it appears to be plotted on a log scale and ignores the daily chart. You need to take a look at the daily and note that the 50dma is 497 and the 20dma is at 797. You have a chart of a blowoff run there with channels drawn in. That is unrealistic in the extreme. Those ma's on the daily will be tested and the 200dma is down around 200. Of course maybe bitcoin will be some kind of exception to the rule but your channel is a blowoff run IMO.

here it is at daily level

I'm not denying the moving averages will be tested eventually, but if you'd been arguing that with gold at $350 you would have had a long time to wait to be right, and it could next be at a level way above here.

 

[wrs]

here it is at daily level

[qimg]http://www.seoibiza.com/company/wp-content/uploads/2013/12/daily.jpg[/qimg]

I'm not denying the moving averages will be tested eventually, but if you'd been arguing that with gold at $350 you would have had a long time to wait to be right, and it could next be at a level way above here.

Not sure what you are referring to with gold at $350? That was over 10 years ago I think.

You are trying to rationalize an order of magnitude increase in price happening over a period of days being some kind of trend that persists into the future. That is what channels do they persist or fail and the one you drew is sure to fail. You have to realize that money is what moves markets and unless more money comes into bitcoin than is already there, it's not possible for it to continue higher. The price of bitcoin as it stands now is prohibitive. It's clear that there are people trying to drive it higher but unless there are new suckers to draw in, they will fail. I think 1242 was the top but I could be wrong.

 

[psionl0]

Stuff always bounces in a correction. Here is a chart with support and resistance levels. I had seen 910 as a reasonable low yesterday but it overshot. That isn't good for bitcoin lovers because now $838 is calling and eventually, $910 won't be support. For now, $1000 is a round number and could work as support or resistance. $1050 is overhead resistance and $910 is lower support. It could trade in that $150 range for a while. Wouldn't hurt it a bit to do that either. It might gain a little stability but still, it's very expensive for what it is and it's daily moving averages are way back below where it sits right now.

Numerology is such a fascinating subject. Are you sure you don't need to chant some magic words as well?

 

[kevsta]

Not sure what you are referring to with gold at $350? That was over 10 years ago I think.

only that although it is a statistical certainty moving averages will be re-tested, they dont have to get retested at the levels you select now by any means. in fact statistically that is less likely than 50/50.

You are trying to rationalize an order of magnitude increase in price happening over a period of days being some kind of trend that persists into the future.

no Im not, Im showing an alternative "T / A" analysis view to yours? if your perceived "support and resistance" lines are valid, then so are channels?

That is what channels do they persist or fail and the one you drew is sure to fail.

at *some* point, certainly, you seem to have a preconception that it is now, I am just stating that you could be catastrophically wrong.

You have to realize that money is what moves markets and unless more money comes into bitcoin than is already there, it's not possible for it to continue higher.

I am well aware how markets move gracias

The price of bitcoin as it stands now is prohibitive.

maybe. maybe for a while, and maybe not. I can trade it on leverage now, so not for me its not.

It's clear that there are people trying to drive it higher but unless there are new suckers to draw in, they will fail. I think 1242 was the top but I could be wrong.

given that after 5 years of determined CB interventions nobody knows what the actual true price of any money or assets is, and BTC *could* be huge in the future, have you ever considered you just *might* be wrong that this is THE top?

I admire your certainty anyway, but it wont help you much in trading.

 

[Senor_Pointy]

I don't really get the "bitcoin is a pump and dump / pyramid scheme" argument. I mean, in some ways it looks like one in that it has the potential to make a few early adopters rich at the expense of latecomers, but aren't a lot of totally new, untested ventures like that? The disparity between money in and money out for the early adopters might be particularly egregious in this case, given that the first bitcoins flowed like a waterfall at the cost of nothing but a few CPU cycles, but I don't know that that really implies malice.

Having followed this whole thing since bitcoins were <$1, I've always gotten the feeling that the initial people behind it were pretty sincere. They wanted a weird, libertarian virtual currency and structured it according to their theories and biases and held on. I won't comment on the economic theories they built it on because I don't know enough about economics, but my gut feeling is that they're a bit daft. I can't really say. Regardless, even if the world has picked up on it and blown it into a roller coaster speculator-driven thing that could make them obscenely rich for doing piss-all, I don't think that was the intent.

Maybe I'm wrong and the people with >100000btc wallets are just twirling their Snidely Whiplash mustaches and waiting for the right time to cash out and tank the market, but I always thought the early adopters were libertarians, crypto nerds, "currency cranks" (for lack of a better phrase), and people who wanted to buy drugs. That's part of the reason I don't think it will ever truly collapse, if at least a few of the "big players" support it ideologically, and not just for profit.

That said, I certainly won't be buying in now, but if it ever reaches stability on par with old-fashioned currency I can't really see the harm in using it for that purpose.

Of course I might just be naive. I'm certainly not the kind of guy who's shrewd enough to be investing in anything, so I don't.

 

[psionl0]

I don't really get the "bitcoin is a pump and dump / pyramid scheme" argument.

It doesn't matter whether it is or not as long as you say it is.

Similarly, always say that it is "the end of bitcoin" no matter what the recent price history.

 

[remirol]

I don't really get the "bitcoin is a pump and dump / pyramid scheme" argument. I mean, in some ways it looks like one in that it has the potential to make a few early adopters rich at the expense of latecomers, but aren't a lot of totally new, untested ventures like that? The disparity between money in and money out for the early adopters might be particularly egregious in this case, given that the first bitcoins flowed like a waterfall at the cost of nothing but a few CPU cycles, but I don't know that that really implies malice.

I don't think it was originally designed as one, but there sure look to be a number of active players doing exactly that right now.

That said, I certainly won't be buying in now, but if it ever reaches stability on par with old-fashioned currency I can't really see the harm in using it for that purpose.

I'm not sure anyone really sees any _harm_ with Bitcoin as much as we don't have the confidence that it will ever achieve the level of stability necessary to be a currency.

 

[wrs]

I don't really get the "bitcoin is a pump and dump / pyramid scheme" argument. I mean, in some ways it looks like one in that it has the potential to make a few early adopters rich at the expense of latecomers, but aren't a lot of totally new, untested ventures like that? The disparity between money in and money out for the early adopters might be particularly egregious in this case, given that the first bitcoins flowed like a waterfall at the cost of nothing but a few CPU cycles, but I don't know that that really implies malice.

Having followed this whole thing since bitcoins were <$1, I've always gotten the feeling that the initial people behind it were pretty sincere. They wanted a weird, libertarian virtual currency and structured it according to their theories and biases and held on. I won't comment on the economic theories they built it on because I don't know enough about economics, but my gut feeling is that they're a bit daft. I can't really say. Regardless, even if the world has picked up on it and blown it into a roller coaster speculator-driven thing that could make them obscenely rich for doing piss-all, I don't think that was the intent.

Maybe I'm wrong and the people with >100000btc wallets are just twirling their Snidely Whiplash mustaches and waiting for the right time to cash out and tank the market, but I always thought the early adopters were libertarians, crypto nerds, "currency cranks" (for lack of a better phrase), and people who wanted to buy drugs. That's part of the reason I don't think it will ever truly collapse, if at least a few of the "big players" support it ideologically, and not just for profit.

That said, I certainly won't be buying in now, but if it ever reaches stability on par with old-fashioned currency I can't really see the harm in using it for that purpose.

Of course I might just be naive. I'm certainly not the kind of guy who's shrewd enough to be investing in anything, so I don't.

The people with the big wallets need to be able to spend them, not cash them out. If they cannot spend them, bitcoin is a failed experiment. Cashing out a bitcoin for $ to buy what bitcoin cannot is simply admitting that bitcoin can't do what it was intended to do, act as a spendable currency that can't be controlled by the govt.

What they failed to recognize is that bitcoin, just like anything else is subject to manipulation if real money is attached to it. This is what you see right now. The number of people using bitcoin for transactions has likely dropped due to this huge increase in price. Many who would have spent them are now probably either cashing out or just holding them waiting for a higher high.

 

[psionl0]

Now you're just putting words in my mouth.

You are the one who took exception to me saying that It is not logical to suppose that the price (demand) for bitcoins would continue to increase at a rapid exponential rate but the opportunities to sell or spend the bitcoins would remain static.

 

[Wildy]

Because you made a strawman and then claimed that that was what I said.

So you don't want to admit that the actual currency part of bitcoins is woefully lacking, fine. I get it. Just don't make up an argument and assign it to me.

 

[Senor_Pointy]

The people with the big wallets need to be able to spend them, not cash them out. If they cannot spend them, bitcoin is a failed experiment. Cashing out a bitcoin for $ to buy what bitcoin cannot is simply admitting that bitcoin can't do what it was intended to do, act as a spendable currency that can't be controlled by the govt.

What they failed to recognize is that bitcoin, just like anything else is subject to manipulation if real money is attached to it. This is what you see right now. The number of people using bitcoin for transactions has likely dropped due to this huge increase in price. Many who would have spent them are now probably either cashing out or just holding them waiting for a higher high.

I admit I don't know nearly enough about finance and markets to answer this on my own, but is there a reason bitcoin could not stabilize at a certain price? It's deflationary by nature, but is there a reason to believe that other factors won't break the impulse to hoard it? Like, if I get more value out of spending it now than I could by waiting a year and spending it then, I'll spend it now.

I realize this is why regular currency is inflationary, to encourage spending of it instead of hoarding. (This is just the explanation I've been given and I won't argue it either way.) But I don't see why bitcoin couldn't reach an almost equilibrium, where the rate of deflation is reasonable enough that it could actually function as a secondary currency.

Yeah, the price spikes look like a bubble, and it's certainly no use as a real currency unless and until it stabilizes. But if bitcoin stabilized at, say, $1500 USD and gained +.01% value a year, wouldn't businesses/the market be able to compensate for its deflationary nature and start accepting and making payments in it?

Granted I don't buy for a moment that it can completely replace currency as we know it, but I don't think we should dismiss it having any use entirely.

 

[psionl0]

Because you made a strawman and then claimed that that was what I said.

So you don't want to admit that the actual currency part of bitcoins is woefully lacking, fine. I get it. Just don't make up an argument and assign it to me.

Those two lines contradict each other.

 

[wrs]

I admit I don't know nearly enough about finance and markets to answer this on my own, but is there a reason bitcoin could not stabilize at a certain price? It's deflationary by nature, but is there a reason to believe that other factors won't break the impulse to hoard it? Like, if I get more value out of spending it now than I could by waiting a year and spending it then, I'll spend it now.

I think the biggest issue here is that there is no place to spend it in size. Buying $10 worth of hulu isn't going to allow someone to spend all these supposed gains that have accrued.

I realize this is why regular currency is inflationary, to encourage spending of it instead of hoarding. (This is just the explanation I've been given and I won't argue it either way.) But I don't see why bitcoin couldn't reach an almost equilibrium, where the rate of deflation is reasonable enough that it could actually function as a secondary currency.

Currency isn't inherently inflationary. The amount of currency in relation to the value of goods and services produced is what can be inflationary.
Right now, bitcoin isn't a currency.

Yeah, the price spikes look like a bubble, and it's certainly no use as a real currency unless and until it stabilizes. But if bitcoin stabilized at, say, $1500 USD and gained +.01% value a year, wouldn't businesses/the market be able to compensate for its deflationary nature and start accepting and making payments in it?

Granted I don't buy for a moment that it can completely replace currency as we know it, but I don't think we should dismiss it having any use entirely.

It needs to become a currency first and right now, it's just a speculative bubble. It's interesting to watch but I don't see it being any use to me.

 

[TubbaBlubba]

TubbaBlubba, do you have an experts view on why it's a pyramid scheme? Care to elaborate?

The logic goes something like this: The algorithm makes it exponentially harder for coins to be mined. When it was created, the creator (and perhaps his cohorts) had ample opportunity to mine a ton of coins, wait for it to go up and then dump.

It's a "pyramid scheme" in the sense that the amount of coins and thus the value any given person can mine goes down exponentially as the idea is spread. But if enough people believe it an investment, it will temporarily go up, and the people "higher up" can cash out.