IamNomad

USD margin study VS market action and possible future scenario

BITFINEX:BTCUSD   Bitcoin / Dollar
440 6 12
We've all noticed the mass decrease margin on bitfinex, currently at 20,957,440 or a 6,472,450 total decrease from the recent median price . That my friends, is a lot of bitcoin!! Even if it was purchased at the highest price possible from the last major margin jump it would still be roughly 14k bitcoin . For reference there is 12.5 k bids to 300 currently (from 371.5) and 14k to 250.

For the purposes of this discussion, lets assume there is one or several people that work together (ie trading firm,pump group whatever) on finex.

So if one was in a position where he wanted to get out leveraged position and return to USD (for whatever ever) what would one have to do ? You would obviously sell, but how do you sell that big of a position, even with order book as full as bitfinex , without taking a serious loss ?

This is where the assumptions based on confirmed past events, narrative and possibly a bit of fiction comes in.

--begin story--

You would to create a series of events that buffers enough coin so that you could exit. Bags changing hands if you will. (since youre not concerned about manipulation charges since this market is unregulated) This costs money though - money which have you currently have tied up in a position. So first you have to exit some of your position (or cause an event that make people exit) by selling

1/8 -1/15 selling occured until 25,858,712 total margin was free or ~1.8 million dollar is freed up. That worked ok but you still have ~4.5 million locked up. Selling down further would potentially mean starting to take a costly losses to get out.

1/16-1/29 a serious of pump candles that were fully retraced the following day were drawn.

2/1 - 2/9 the final shaking of the branch happpens. The volume going equal almost that of going down exactly. No new lows made. But your margin position is now closed.

End result:
dollar margin usage is low
BTC is also low.
---end story---

So what does this leave with TA wise?

  • higher lows w/ a confirmed trend line
  • high time frame over sold
  • 1W stoch rsi reset poised to cross up.
  • plenty of margin available to long
  • low volume over all (with the exception of the pump and dump candles)
  • horizontal support/resistance levels defended

Given this, when was the last time we saw something with simliar characteristics? Answer: 11/11 -11/24
  • margin reach a low of 19,194,679
  • margin reach a low before horizontal resistance would stop selling it down.
  • high time frame oversold.
  • higher lows w/ a confirmed trend line
  • 1W stoch cross back up (after leaving the over bought range)

If this is indeed the same setup, it will likely happen with in the next 5-9 days.
Current price could close as low as 367.5 and still be valid.
A close below 360 would invalidate this theory. Support would be 350 at that point.

few other x factors worth mentioning
  • btce has been 7-10 dollars ahead of finex this whole dump. finex has been leading.
  • china 10-15 dollars ahead of finex.
  • China barely follow the downward motion of finex and recovered way faster
  • Chinese new years holiday concludes 2/12 - 2/13
  • confluence of major trend lines around 2/12-2/14










zeratul600
10 months ago
im sorry im not the sharpest crayon in the box, if I did understand you, big whales need to get out of their positions, so they create a fake rise in price in order to be able to close their position without losing all that money????. If that is true, you also say that a similar movement will happen in the next week? if that thing happen how high do you believe the price will get?
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IamNomad PRO zeratul600
10 months ago
First, your understanding of the first part about correct. the trick is to unload a position without destroying the price, and therefore your profits. This market is too small to sustain a 6 million dollar hit at once. I am suggesting the buying up and selling down is one way to do that. (you see it in penny stocks ,small cap stocks and alt coins all the time). The second part you missed. If you view the right panel youll see we went from 317-474 , a 158 dollar move. I'm suggesting that it possible to see a large move up soon.
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IamNomad PRO
9 months ago
snapshot

this is working so far as expected.
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zeratul600 IamNomad
9 months ago
of this plays like you said (and i believe that there are many things making it possible). I might be able to close a 5.5 btc position with a profit. Thank you so much for taking the time to answer me. Btw dont you think that a lot of hashing power of the network will be gone after the halving? maybe big farms, are milking all the btc they can before the halving, no matter how small the profit would be, right after the halving they wont be able to make a profit using the same old asics, so they are running for their lives now, and after the halving, they'll wait until the price catch up with small block reward.
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IamNomad PRO
9 months ago
snapshot


working really well so far. reclaimed the 410ish level on way less USD margin being used.
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IamNomad PRO
9 months ago
update
snapshot


last night ATH there was 23,589,181 long in margin out.. the current used is 21,593,915.taking the other candles in context. 1.5 million was spent in roughly 6 hours.. on a sunday evening asia time.
short actually did not go up all that much from previous days candles to here. ~2k btc btc usd in position.

there a pretty solid chance for continuation here.

disclosure i closed the original long 368-450.8 but am long after the 20 dollar drop.
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