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Bitcoin - Price Behaviour

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@247trader, have a look at the charts and draw some conclusions. The inference I am making is that it may well be. In terms of what it means, well from a trend following perspective it is a very healthy and positive sign. Especially, for those who have a long position. It would be more negative news for those with a short position if they had opened one after the 8th September 2018.

However, this is Bitcoin. All it takes is some negative media news and it could easily hit $5,000!

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15 hours ago, TrendFollower said:

The real question right now on Bitcoin's price behaviour is if you look at the chart and whether it is making higher lows and higher highs since 8th September 2018. 

Yeh But to be fair you can’t just leave the above open ended. It doesn’t make sense to just say “ask yourself if the markets are making higher lows” and then not give the expected direct. It’s all just babble and waffling and somepeople aren’t astute to market movement and technical analysis. 

 

 

 

Edited by PandaFace

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When it comes to price behaviour for bitcoin

"Referencing a specific section of U.S. law governing the SEC, instituting "proceedings to determine whether registration should be denied" effectively gives the Commission up to 180 days to make a decision from the date the VanEck and SolidX proposal was published for comment in the Federal Register, which was July 2."

That means we're looking at Dec 29th and would conform nicely to the historical rallies over this period.

heres what the news is saying about this event: https://www.google.co.uk/search?q=bitcoin+etf ..... $40k bitcoin plz :P

209957562_bitcoinETFnews.thumb.png.98658e3c0aa5614b40fd95508f08be67.png

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nope , I just see this as fading out - just slowly going lower. There's a clear trend there , until it breaks imo

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@PandaFace, first of all one the reasons for the IG Community is to encourage discussion on trading. I was merely trying to encourage discussion.

Please accept my sincere apologies but I do not always have the time to spell everything out or do all the thinking for potential readers. I think anyone serious about trading and investing has to do some reading and research themselves. They must dedicate some time and apply some effort in doing so. Maybe my posts can encourage them to do so! ?

If I want people to think, encourage counter arguments or give me something to consider which maybe I have not thought about then I absolutely can leave it open ended, especially if that was the aim. After all it is my post.

You state that some people aren’t astute to market movement and technical analysis. You may be right but that is out of my control and I do not know who these are or even if these are the people who read any of my posts. 

I have limited time and I try and participate as much as I can on the IG Community. I do not get paid by IG for any of my posts. 

If you wish to educate these people you suggest that are not astute to market movements and technical analysis then please feel free to do so. That is another reason for the IG Community. There will be some of you who are more better suited to this. I encourage you to do so. If you do then I look forward to seeing it and may even comment on your post and offer some feedback. 

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@cryptotrader, yes if you click on it then it opens up an enlarged version. Thanks for this. Very interesting.

I think October, November and December are going to extremely interesting months for the price action of Bitcoin. You post above infers the same and certainly implies that a sharp move is coming whether that be up or down!

 

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Bitcoin seems to be showing some very strong resilience in staying above $6000.00. It is still way up from levels 1-2 years ago with the exception of the monster rally up to $20k. If you look at Bitcoin's resilience over the past 10 years then it is also very impressive. 

It is reported that Bitcoin's volatility has hit an 18 month low. It is defending the $6k price extremely well. I am also hearing of a token / coin on the Ethereum platform pegged to Bitcoin. If this is true then it may be the start of the journey where the 'Reserve Currency' within the Cryptocurrency universe is Bitcoin and also major alt coins get pegged to Bitcoin.

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it looks like periods of consolidation are good times to buy the actual bitcoin with cash you're willing to lose (i.e. beer money)

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Very true @247trader of all markets, but I'm curious, why buy and not sell?  My chart below suggests the trade on this market is on the breakout of the long term Triangle consolidation BUT recently there was an attempt to do so by the Bulls, which was swiftly and strongly rebuffed.  The closer a market gets to the end of a Triangle the less reliable it is as as an indicator and yet I have a feeling this one will break soon but which way?  My feeling is down, others think up as Markets crash.  All too uncertain for my beer money, I'd rather find more reliable set ups.

Ask yourself, what else could I do with my beer money, that might actually get me a few more rounds?  Lower margin, lower bet value, higher points potential, lower risk set up for stops etc etc.  I just don't see it on Bitcoin but would love to see any analysis you crypto guys are using.  If I am right and Bitcoin does drop through this Triangle then the pointage is curtailed to max, say, 4,000.  Obviously if it hammers up then who knows, I guess that is what people are hoping for.  If you look at the Monthly or Weekly chart however RSI hasn't got anywhere close to oversold and Daily is not quite there yet either.  If Cryptos actually fail will a Short even payout?  Let's call this healthy skepticism rather than anything else but if anyone can build a case for this vs a big short to come on stocks say or massive longs Gold/Silver I'd be truly interested.

Bitcoin-Daily_301018.thumb.png.8d32bcbb7a1f4505e790aa0e6562fe48.png

 

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@Mercury,

I admit that I am more positive on Cryptocurrencies, Blockchain and Tokenisation than most from the IG Community. This is purely based on the reading and research I have conducted over the past few years. This article below will help put things in perspective for Bitcoin specifically and its history since 2009. 

https://www.buybitcoinworldwide.com/price/

We have seen many large corrections and larger comebacks. The article below will just offer another view on this matter.

2013 to 2017: Comparing Bitcoin's Biggest Price Rallies

https://www.coindesk.com/2013-today-comparing-bitcoins-biggest-rallies/

From a shorter term trading perspective I do not think there are enough strong 'signals' or 'indicators' that suggest one opens a long position on Bitcoin at this juncture. However, opening a short position right now would be quite arisk with the potential SEC announcement imminent on any Bitcoin ETF approval and were it to be approved. 

From a longer term investing perspective, if Bitcoin can demonstrate it has bottomed and there is a clear trend reversal to the long side then one could look at investing. I was fortunate enough to have got into Bitcoin at the $2000 levels via XBT's ETN which I am sure some of you will be aware of as I have mentioned it in previous posts. I am holding that. Yes, I should have sold at $20,000 but I did not.

You are right. There may be better trades than Bitcoin but I personally just do not have time to study, monitor and trade all the other assets so I tend to stick to Commodities and Cryptocurrencies. I think you make a valid point that there are certainly more compelling trades right now than Bitcoin and it is a very important point that you make. 

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Food for thought courtesy of Elliotwave International.  You can get a certain amount of free material of this nature by registering but of course they are looking to sell services and materials such as books.  Even if you are not interested in Elliot Wave Theory it is worth looking at alternative views from people who have been around for a long long time...

 

Excerpt from The Elliott Wave Financial Forecast -- January 5, 2018

 

BITCOIN: THE GREATEST BUBBLE OF ALL TIME

Back in 2010, when Elliott Wave International first discussed the outlook for bitcoin, Elliott Prechter offered an extensive and positive review of its prospects. After detailing bitcoin's origins, purpose and operational features, the September 17, 2010 issue of The Elliott Wave Theorist concluded, "Bitcoin appears to have enormous potential"; at the time, it was trading at 6 cents. As a July 2017 EWT update noted, this "proved to be the buying opportunity not just of a lifetime, but so far of all time." From that point to its highest quoted value of $19,511 on December 17, bitcoin gained a hard-to-fathom 32 million% (roughly speaking, as peak times and prices vary among different exchanges).

From Crypto-Craze to Cryptonite

In July, bitcoin was approaching $3,000 and Elliott Prechter warned of a mature Elliott wave pattern, optimistic psychology and fundamental constraints in the form of blockchain bottlenecks and stated that they "will lead to the collapse of today's crypto-mania." The bubble was not done inflating however, and bitcoin persisted in pressing higher. Still, throughout the latter half of 2017, EWT and The Elliott Wave Financial Forecastcontinued to point out the insanity and significance of the crypto-craziness. On December 1, EWFF cited a "rising sea of euphoria, ever-higher price projections and the capitulation of financial sophisticates" as a powerful combination of forces that would mark the demise of bitcoin's incredible upward trajectory. "We are more convinced than ever that bitcoin will disappoint its late coming enthusiasts."

Through the first half of December, evidence of a rarified sentiment extreme continued to mount. One prototypical occurrence in the life of any investment bubble is that fateful moment when investors become so enamored of fast-rising prices that they borrow to the edge of their means to purchase the asset. By December 1, bitcoin had clearly surpassed this hurdle. The president of the North American Securities Administrators Association observed that investors were taking out mortgages to buy bitcoins. "People do credit cards, equity lines," he added. In recent weeks, several firms touched off rapid increases in their share price by simply announcing plans to plunge into the cryptocurrency business. UBI Blockchain Internet is a prime example. In December, the company revealed that it will use blockchain technology to "trace a food or drug product from its original source." In a share offering that was filed on December 21, the company listed cash on hand of just $15,406 and monthly expenses of $220,000. The firm's president is a former executive at American Oriental Bioengineering, the developer of "UrinStopper Patch," a bedwetting inhibitor. Bloomberg reports that the product was "said to contain a ‘radioactive photon' that would ‘warm the acupoints.'" But the stock cratered soon after a Barron's story noted "tests of the patch ‘detected no radioactive elements.'" In the heat of the most intense speculation in history, history has no relevance. An offering of stock in the company was being prepared during the first fifteen days of December, and the chart at right shows what happened to UBI Blockchain Internet's share price during this time; it surged 2200%. As bitcoin continued its advance in the first half of December, similar share-price spikes were posted by several other companies after they "folded cryptocurrency into their business plans." When shares in a manufacturer of electrical supplies announced "plans to join the rush to unlock digital currencies," its stock skyrocketed. Bloomberg stated, "The magical kiss of bitcoin has turned another frog into a prince."

Blockchained to the Bitcoin Bubble

On the afternoon of Sunday, December 17, something happened that suggested strongly to us that the fairy tale part of the story was approaching its climax. As we entered a Cincinnati, Ohio watering hole, we were drawn to an animated discussion by the magic word of "Winklevoss," which could only mean bitcoin was the object of discussion. "It's supposed to go to $1 million," said one of the chatters. This comment seemed a sign that expectations were approaching something that continues to seem impossible to bitcoin's admirers, a final limit. Bitcoin's price peak to date occurred later that day.

Is the bitcoin mania really over? The odds are high that it is, for all the reasons previously enumerated here as well as recent issues of EWT and the Short Term Update. This banner headline summarizes our stance:

Elliott Prechter: I Wouldn't Touch Bitcoin, Risk of Collapse Too Big
-- Newsmax, December 21

The response of the cryptocurrency faithful also suggests that the bitcoin bubble is over; they seem only to be emboldened by its decline from the December 17 high. On December 22, Bloomberg captured the following quote from the chief executive of a blockchain research firm: "As the meme says, ‘If you can't handle my 25 percent plunges, you don't deserve my 10x return.' Nothing goes up forever without stopping [occasionally]." At this point, steep but temporary corrections are just a facet of the blockchain dream state, which is considered a permanent reality. Our chart below of the share price of Long Island Iced Tea Corporation captures the fearlessness of bitcoin admirers. On a single day, December 21, a lightning-bolt rise of 288% occurred, four days after bitcoin's peak. The gain was sparked by the company's announcement that it was changing its name from Long Island Iced Tea to Long Blockchain Corporation. At the same time, the "obscure microcap" said it "will now seek to partner with or invest in companies that develop blockchain." The firm currently "has no agreements with any blockchain firms." In the first nine months of 2017, the company lost $11.6 million on sales of $3.9 million. How will a company that did so poorly in the iced tea business make it in a complicated technology business that is being inundated with well-funded competition? In the upside-down world of bitcoin, one trader explains, the best strategy is to come up with "the most superficial understanding" imaginable and then assume "that's how the market will act." We've seen it before. In the technology mania of 1999-2000, earnings and then sales were cast aside for "burn rates" in which a company was celebrated for how quickly it burned through its venture capital financing. The object was not making money but losing it slower than other available technology stocks. Yes, Virginia, pockets of insane optimism still do exist; but not for very long, in our opinion.

Tea-ing Off

If this mania is not over, it should be very soon. History's most important lesson is that after a mania ends, a crushing bear market follows. By studying past manias, EWFF has demonstrated that their termination may be confirmed by the appearance of a new reality in which fraudulent practices and other shortcomings, overlooked during the manic phase, begin to make news. EWFF discussed the importance of this phase as the dot.com bubble began to unwind in mid-2000. In a June 2000 section titled, "Financial Shenanigans Coming to Light," EWFF noted that a "return to sobriety is uncovering all kind of techniques that have allowed firms to pyramid stock market gains." In time, the same transition from a bullish atmosphere of widespread credulity to a bearish vibe of distrust and skepticism will develop in the crypto-coin market. Firms such as UBI Blockchain Internet will be cut down by the dominance of a negative mood just as Enron and Martha Stewart's insider-trading antics were in the early 2000s. For some, we suspect that the journey from blockchain to chains and a cell block will be a quick one. Even at this very early stage of a trend reversal, the evidence of a growing hostile environment for cryptocurrencies is taking form. In recent days, bitcoin has been identified as everything from a corrupter of youth to an environmental hazard. The former charge was leveled by the South Korea Prime Minister Lee Nak-yeon. Likening cryptocurrency trading to a social pathology, Nak-yeon said "it could cause kids to get into crime such as drug trafficking or pyramid schemes." South Korea's Ministry of Justice says it may close all of the country's cryptocurrency exchanges. As the bear market heats up, governments will attempt to get in on or simply overturn the cryptocurrency bandwagon. Russia and Venezuela have announced plans to issue cryptocurrencies, and the Bank of England is exploring setting up a sterling-based cryptocurrency. As EWI has discussed previously, governments are always the last to act on a financial trend; their involvement usually means the trend is near exhaustion if not past it. The reputed environmental impact of bitcoin mining will probably serve as another excuse for heavy-handed government involvement. A Bloomberg column notes that bitcoin mining operations may equal the energy use of "three million U.S. homes." "If we start using this on a global scale, it will kill the planet," says one crypto-critic. More emerging bitcoin fiascos are hinted at by these recent headlines: "Bitcoin Intensifies Pain for Some as Ransom Demands Skyrocket;" "Large Bitcoin Exchanges Say Hackers Are Attacking Again;" and "Bitcoin Is a Fraud." The last is from the Daily Express (U.K.) on December 22; it notes that bitcoin "has received a great deal of negative press in recent days." The bad press will only get worse as the great Bitcoin Bust intensifies.

Of course, bitcoin's biggest problem is that it no longer works for its intended purpose. EWT pointed out this shortcoming in July; it is now starting to be discussed more broadly. A Bloomberg column on December 27 says, "Bitcoin Is an Implausible Currency." As a medium of exchange, bitcoin's flaw is that it is becoming less efficient as it becomes more expensive to complete every transaction. As a store of value, a currency's other primary function, it was more than adequate for a time; it added astronomically to early buyers' original outlay. Since December 17, however, holders have not been so fortunate. Instead of storing value, their bitcoins are shedding it, sometimes in double-digit percentage chunks in merely minutes.

Excerpt from The Elliott Wave Financial Forecast -- February 2, 2018

Say It Ain’t So, Bitcoin

As EWFF noted last month, one of the last things to happen in a mania is that investors, in hopes of earning outsized returns, become so sure the rise will continue that they borrow money to purchase the assets that are the object of their affection or they purchase assets that are levered up. In the stock market, this conviction is now evident in the activity in leveraged ETFs. From late 2017 to mid-January, the ratio of assets in leveraged-long ETFs versus those in leveraged-short ETFs jumped from 2 times to nearly 4 times. This record is more than 34% higher than the prior extreme, set in early 2015. Bitcoin is another speculative juggernaut that demonstrates this principle. As it registered its price peak on December 17 at $19,892, LendEDU, a consumer credit information website, completed a survey showing that 18% of buyers were funding their bitcoin purchases with credit card debt. Of those, 22% did not pay their credit card balance after the purchase, suggesting that they have no savings. Nearly 90% of bitcoin investors carrying credit card debt said that they expect “to eventually pay off their balance using profits from their bitcoin investment.” The Wall Street Journal notes, with characteristic understatement, that paying off double-digit, credit card interest rate debt as well as bitcoin transaction fees means that “borrowers need bitcoin to rise substantially in value.”

To say that bitcoin is not cooperating with these expectations is another understatement. It is now down 54% from its December 17 top. The chart above shows a clean break of the curve that had delineated the cryptocurrency’s parabolic rise. With this boundary crossed, we consider the bitcoin bull market to be irretrievable. Another very strong clue is how undaunted the body of bitcoin believers remains. In a recent article in the Daily Express (London), a bitcoin devotee calls the price decline into the middle of January “exciting.” The article is headlined, “Crytpocurrency will BOUNCE BACK.” Another widely followed “bitcoin bull” has repeatedly maintained that “the $9,000 level marks a major low.” His year-end 2018 price target is $25,000. Even retirement planners are jumping on the bandwagon. The bitcoin IRA also arrived in January, and its sponsors are super bullish. According to the headline on the website bitcoinira.com, bitcoin’s price “Can Increase to $400,000.” An accompanying note cites the “billionaire” behind the forecast and adds, “Major investors are predicting prices ranging from $28,000 in 12 months to over $1 million by 2020.” In a Forbes magazine article, the bitcoin IRA founder says, “It’s time to look at saving for retirement as an exciting experience rather than a painstaking one.”

It may turn out to be “exciting,” but for many operators it is recently become downright dangerous, as the post-peak scandal phase that EWFF discussed last month continues to cast a wider and wider net. Among the latest discoveries is newly lost crypto coins valued at about $400 million at Coincheck, one of Japan’s biggest digital exchanges. As of last Saturday, the company was not sure how it lost the coins but it “has suspended most trading and withdrawals.” The company is not alone. Bloomberg published this revealing expose on January 18: “Hackers Have Walked Off with About 14% of Big Digital Currencies.” The theft tally for all those initial coin offerings (ICOs) that EWFF discussed in September, October and December is not far behind. According to the consulting firm EY, more than 10% of ICO funds, worth roughly $400 million, has been stolen by hackers. The farther bitcoin falls, the bigger the scandals will become. On Tuesday, the SEC froze the assets of a Texas-based initial coin offering that claimed to have raised more than $600 million. The SEC says, “AriseBank used celebrities to tout its fraudulent offering.” It was just three weeks ago that AriseBank announced the endorsement of former heavyweight boxing champ, Evander Holyfield. Among other things, it seems the firm’s president failed to mention in AriseBank’s offering statement that he served five years for felony robbery. Last month we maintained that “for some, the journey from blockchain to chains and cell block will be a quick one.” Things are heading in that direction even faster than we thought.

Still, the party rages on. In a scene reminiscent of the movie The Wolf of Wall Street, Bloomberg reports that a recent Miami bitcoin conference was held in a 20,000-square-foot Miami strip club. “We’re a bunch of dudes with a lot of money in our 20s. We like naked girls,” said a cryptocurrency trader from New York. Not all attendees were amused, including a female financial-technology lawyer who spoke on one of the panels. “It was a bunch of newly minted millionaires getting drunk and rowdy, and then you introduce naked or half-naked women into the equation.” Then there’s the Blockchain Cruise that sailed into Thailand’s Paradise Beach after bitcoin’s price was cut in half. “If anyone was fazed, they didn’t show it,” Bloomberg said of the crypto-revelers. “The steadfast optimism on display carries a warning for anyone betting on a cryptocurrency crash: It’s going to take more than a 50% drop in bitcoin to drive out the die-hards.” He might be right, but with bitcoin currently down 54% from its December 17 high and traders as confident as ever, the odds are stacked heavily against any return to the old highs.

Edited by Mercury
Graphs didn't come through in first paste

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@Mercury

Wow, that is a long post. Would it not have been better just to paste the link?

I found the following article which if credible and correct is interesting:

SEC Decision on Bitcoin ETF Will not Be Announced on November 5

https://www.blockchainreporter.net/2018/11/05/sec-decision-on-bitcoin-etf-will-not-be-announced-on-november-5/

If the SEC reject all of the nine Bitcoin ETF's then I think the crypto market will be going down and there will be some very heavy downward pressure. If the SEC even approve just one of the nine Bitcoin ETF's then I think it has the potential to be the catalyst for the next monster rally upwards for cryptocurrencies. 

Now from a trading perspective one simply cannot know if they are going to trend upwards or downwards. There is a lot of sideways action at the moment. If there is another big move down and the price action confirms this then there will be plenty of shorting opportunities just like there was when Bitcoin went from $19k down to $6k.

I am fascinated about Cryptocurrencies so I do follow them and the news released as a lot of my posts will demonstrate. However, I accept that they could decline further from this point if the news released to the market is negative with a bearish bias.

What Cryptocurrencies have done is brought the technology behind it, Blockchain, to the fore. Also 'Tokenisation' or 'Tokenomics'. The Token Economy is starting to gain traction and build some momentum though there is a long way to go but Cryptocurrencies have allowed us to get to this stage.

I am very intrigued and interested in the price behaviour of Cryptocurrencies. It is fascinating and is providing an excellent lesson in comparing what the media presents compared to the price action. 

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Well you have to register to access the content so I though I was doing people a favour by pasting it...

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@Mercury, that is fair enough. 

This article is interesting as Bitcoin's volatility is reducing and the charts show us this. However what we have recently witnessed is a lot of volatility in equity markets.

Bitcoin futures volatility sets record low

https://www.marketwatch.com/story/bitcoin-futures-volatility-sets-record-low-2018-11-05

 

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Bitcoin is making new lows for 2018. 

It has crossed the psychological $5,000.00. 

One thing is for sure. If institutional investors are looking at acquiring Bitcoin or any ETF's are approved then the purchases of Bitcoin will be a lot cheaper now. 

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Don't see anyone catching the falling knife on this one.  It only looks cheap compared to the bubble.  Will it still look cheap when it hits $1000?  Sensible approach is to sit back and wait for the carnage to end then reassess.  I suspect institutional investors will be preoccupied with their falling portfolios in the "real world" to worry about currency avatars. 

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Just for fun on a quiet morning at work...  To be clear, if you are not already, I am not trading these crypto markets and am not only Bearish but am convinced this iteration of the technology and the idea will die, just at the first internet bubble did.  I was there, I saw it.  The same hype existed then as it does on cryptos.  I am expecting the same result this time in that the early adopters get obliterated along with the bubble speculators and this is a classic bubble, make no mistake.  Just look at the chart!  This will go down in the annals along side the Tulip Mania, South Sea bubble and of course the DotCom bubble and the sub prime scandal and still to come perhaps the great housing market bubble...

So much for all that, let's look at the chart.  The bubble is clear to see but what is interesting is that now these markets have broken out of a massive consolidation phase to the downside people are still talking it up...  Fib 76/78% has been breached (note this occurs at a top and consolidation retrace point on the way up).  We could see a similar small pause under the Fib levels before a continuation of the ending bear.  The last vestige of hope is the Fib 88% zone (again coincidental with a consolidation zone on the way up) and if this does not hold and spark a major recovery (and what would be the spark for this I wonder, especially if we are seeing red ink everywhere else except Gold/Silver and USD?) then we arrive back at the incubation one, which at the end of the bubble cycle is the death zone.

Just as with the first DotCom bubble it is the new entrants that take up the technology and develop, addressing the fatal flaws for a new era, that will emerge like the mythical Phoenix from the ashes.  Who will be the new Google?  Maybe Google?  Maybe governments, who need a way to eliminate cash?  Maybe something else...  So if you want to trade (or more likely invest in) the Crypto idea, look for the Phoenix.

Bitcoin-Weekly_281118.thumb.png.226f74823d3fa2dc2911d07c50323077.png

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Playing ****'s advocate to my ****'s advocate eh! 😃

I'm not sure what I am look at @cryptotrader, I can only see the 6 boxes but all of them are on the way up whereas the current drop is clearly on the way down.  The percentage drop is not relevant here, only the support/resistance zones are relevant, which I cannot see from the picture you posted.  The notion of a correction implies a retrace before a fresh rally to higher highs.  This only holds in a Bull market.  Does anyone still think Cryptos are in a Bull market?  Any technical analysis has to be in context and that context also dictates where and how you might draw the technical elements out on a chart.  The most important context is whether the market is in a Bull, Bear or consolidation phase.  My chart is based on a Bear market.  My assessment is that IF the Bear does not get stopped before it returns to the incubation phase then this particular market, in its current form, is doomed.

Let's put it another way, what would we be discussing if this were a chart of a company?  What would happen to such a company if it was based on a decent idea that was before its time with assets that had utility still but the current company could not make it work?  Answer, it would get bought up by shark.  This is the natural order, it is Darwinian.  The weak are taken out by the strong, who feed on them.  This is essentially what I am suggesting will happen to this iteration of Cryptos.  Unless there is another massive rally in wider asset classes (as opposed to a major Bear phase) I cannot see where the impetus for Crypto recover will come from, can you?  At best then anyone invested or owning Bitcoins (or their Ilk) can only hope that the organisations behind them bump along the bottom for the next 3-5 years until the Bear is done and the next Bull kicks in.  I wouldn't want to be betting on that is all I'm saying...

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I think I commented on another thread this very point that Amazon during the Dot.Com period lost around $1.5 billion. It is now, 18 years later, only the second company to have a market cap of $1 trillion dollars. 

Yes, a lot of Cryptos will die, but the strongest will survive and adapt to market conditions and any regulations going forwards. This type of price action and major corrections have occurred a few times since inception so there is nothing new here.

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Amazon, hmm.  Not exactly the same situation and if anything Amazon wasn't in a bubble back then the whole market was, but Amazon certainly is now, and guess what will happen next..?  The difference of course is that consumers liked the Amazon proposition and it soon became widespread, despite the collapse in the initial share price.  Amazon is a company with a proposition for consumers where as Crypto is unproven and will not become accepted as a currency until it is backed by something more than vapour-ware.  What Amazon benefited from was the initial bubble hysteria to float, generating sufficient funds to enable them to push their business model, which is now widely adopted and successful.  The hammering the share price will get next is largely superfluous so long as the business remains in good shape (not for investors of course but who cares about them right..?).

But in the case of Bitcoin the investors are the consumers.  Who will put their precious cash into bitcoins and their ilk once it goes into the incubation levels of valuations while the Bear is digging it's claws in elsewhere?  Everyone will flee to cash and precious metals and maybe US Treasuries.

Anyway it's nice to have dreams...  I just wouldn't trade it

AMZN-Monthly.thumb.png.250fce07254ba2363af47dda6b49f670.png

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@Mercury,

Crypto's can be traded just like any other assets both on the 'long side' and the 'short side' based on price action. It really is no different to trading stocks, commodities, etc. If you use technical analysis then it can be applied to Cryptocurrencies. It should not matter whether you understand Cryptocurrencies or you believe in them. You are merely trading based on price action. When trading Cryptos then one must ignore the 'market noise' just like in Commodities and Stocks. I have traded many companies which I did not believe in and profited based on price action. I will just have to accept that our views will differ on this. As someone who follows 'Trend Following' principles then I do not think it is important to understand or believe in the asset you are trading as long as you are trading principally on price action and trends. 

Cryptocurrencies brought to the world - Blockchain Technology. Blockchain and Cryptocurrencies are now bringing to the world 'Tokenomics', 'Token Economy' and 'Tokenisation'. 

Some of the research I have conducted on Blockchain and Tokens is fascinating and a strong movement has already began to tokenise assets to aid in transfers and transactions. I totally appreciate that many will not understand my views or think I am being stubborn but the future is tokenising of assets and this will be based on Blockchain technology. Bitcoin and other alt coins are after all 'tokens'. 

We will have to agree to disagree.

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But we don't on that I think @TrendFollower.  I too believe that the blockchain technology, or a future evolution of it, will replace physical cash.  This is something that is already happening, as @cryptotrader suggested recently I think, with respect to the use of cards.  It seems the only place we disagree on is how it will happen.  Whereas you think one of more of the existing forms will win out I believe none of them will survive because they are untrustworthy.  Why?  Because no one is going to put their hard earned cash/assets into the hands of unknown and unseen private individuals.  For all the apparent mistrust of so-called fiat currency it is the only basis for a medium of exchange that will be believed in by everyone, which is why the USD is the world reserve currency.  And for cryptos to succeed they must become mainstream accepted and that will not happen until the technology is used by governments to manage their currencies electronically.  I find this area very interesting as it will have repercussions in many perhaps unexpected ways.  Consider what happens in banks wish to charge us interest for holding cash (i.e. positive balances) in a NIRP world.  This can only happen without the ability to withdraw cash.  In an electronic currency world this issue is resolved for governments.  It also has the added benefits of combating tax evasion and criminality, which is also an agenda we are seeing governments pushing.

So my call is based on the above underlying and irrefutable fact.  And the impetus cited by many of the Crypto prophets, that it will replace "untrustworthy" governments is the same basic mantra that the first internet bubble prophets used.  Only the companies that embraced the mainstream, leveraging the internet tech, survived.  It will be the same with Cryptos is my thesis.  If I am right then sticking with the current crop is a losing strategy, as it trading it either way.  Will a defunct market pay out if it effectively goes to zero?  Ho can you exit a short if there is no one to buy?

 

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@Mercury,

Just like the US Dollar is the worlds reserve currency, Bitcoin, could be the reserve currency for Cryptocurrencies.

I do not think Bitcoin is going anywhere for the foreseeable future even if the price was to go down to $3,000, $2,000 or even $1,000. I do not see Bitcoin going all the way down to $100. I think in my lifetime we will never see Bitcoin at $100 and if we do then I will accept that Bitcoin will have failed. If Bitcoin fails then so too do the majority of the 'alt coins'. 

I don't particularly likes these forks and Bitcoin has already had Bitcoin Cash which itself has had a fork and I don't like this as it paints an unclear 'road map' going forwards. I would like to see re-mergers where Bitcoin could merge with Bitcoin Cash, Bitcoin Gold and Bitcoin Diamond to become one big giant Cryptocurrency or I would like to see Bitcoin Cash be used for payment transactions, Bitcoin Gold as a store of value and Bitcoin as the mother of all Cryptocurrencies that they must all be pegged to. 

I can see your point and where you are coming from and you may well end up being right and 'spot on'. I see Ripple is concentrating on business transactions across the globe and Stellar is concentrating on individuals paying each other across the globe but both are on a very small scale at the moment. This could change but it certainly is not Bitcoin leading the way in this which is why I think it will become the reserve currency within the 'Crypto Universe'.

My views could change as new research is conducted and more analysis is carried out but this is certainly an intriguing and fascinating asset class and I am following the journey with huge interest. 

Why do you think IG are offering its clients the chance to trade Cryptocurrencies? Do you think IG are taking its customers for fools? 😂 Actually I think I know what your answer will be to that so don't answer this particular point.  🤣

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