Careful using historical indicators

BITSTAMP:BTCUSD   Bitcoin / U.S. Dollar
571 8 5
Here we can see that things may look a little bit different this time around, but that nothing is necessarily out of place. We still have 2x7/30 weekly MA crosses and 3-4x10/21 weekly MA crosses in between bubbles, meaning another one isn't out of the question at all. In fact, it simply bolsters the idea that this may be a normal extension of the process now that we can see it play out on a larger time scale. I added fib channels to show possible take-off points if this does occur.

Suffice it to say, we can't always judge the current price action by what has happened in the past without looking at the big picture. By the time we can tell what's different on a large scale, the big moves have usually already happened.

Long story short, be ready.

Contributions welcome:


Related Ideas

Here we can see that things may look a little bit different this time around:

July 2012: 1 BTC costs 7 US Dollar
July 2013: 1 BTC costs 90 US Dollar
July 2014: 1 BTC costs 600 US Dollar

Although going from 7 US Dollar to 90 US Dollar was an increase of 12x and from 90 US Dollar to 600 US Dollar was only 6.6x --- the big difference is that people could still easily afford to buy 1 BTC for 90 US Dollar.

Especially 1 BTC for 7 US Dollar was very affordable. But 600 US Dollar is a lot of money for something that is obviously going down in price since December/January. We first need to test the last low of around 400 US Dollar before we can start a new rally.

And don't tell me they could buy 0.345 BTC. People want to own exactly 1 Bitcoin.
MoonTrader ChartArt
I think this obsession with round numbers is a bit over-hyped. It really doesn't matter whether it's 1 BTC or .345, and I think people are at least smart enough to see that. Part of BTC adoption is realizing that you don't need an entire BTC to have the same amount of value. You have to have the intelligence of about a 2 year old to realize this.
+1 Reply
IvanLabrie MoonTrader
Yet people don't...since we can clearly see support/resistance areas close to said round/psych numbers.
tootyfrooty IvanLabrie
You kind of answered your own question? They are simple psychological barriers which occur across ALL markets. It's just how markets (humans) work.
MoonTrader IvanLabrie
Is this really the best argument you have? "People want to buy 1 BTC, but they want to pay $400, not $600." Yeah, and you know this... how? Why is this apparently the first time this is a concern? How do you know this conjecture hasn't already been priced into the market.

Besides, psychological barriers is different. One is a trading phenomenon, the other is a decision about personal possession of a particular currency. For one, you can still purchase exactly 1 BTC, it's just a bit more expensive. People may be hesitant to pay more than $500 for 1 BTC, but that doesn't mean they simultaneously lose hope in ever owning exactly 1 BTC, or that .8 BTC would somehow be worth less than .8 BTC. These things are already priced into the market. That's why they're psychological barriers. Who decides at what point 1 BTC is just too expensive? I'll tell you who, the market! Like I said, this whole speculation is just part of the pricing that has been in effect since day 1.
IvanLabrie MoonTrader
Of course, market sentiment is way more important than round number induced resistance or support levels.
+1 Reply
MoonTrader IvanLabrie
Overcoming these psychological barriers is just part of adoption. One moment you think people would never pay that much for something. The next, it seems like a great deal when the price has increased 10x.
"meaning another one isn't out of the question at all" - 100% agreed, yet unlikely. I'll publish a similiar chart today with buy and stop targets so you won't miss out on either the bull or bear fest.
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