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Bitcoin technical analysis

  • #1,541
  • Jan 17, 2014 5:11am Jan 17, 2014 5:11am
Good morning,

To me it's still very uncertain direction, 880 hasn't been broken on gox, that would be the trend reversal point toward KiwiOz analysis.
Daily and 4h indicator are very low and pointing toward the upside. So, looking at 935 over there.

A bit of a thought for DPR, have you guys ever heard about other SR arrest or BTC crimes ? I wonder what other LEA did with the seized BTC.
Lot's of country don't have any sort of asset forfeiture program. They can only seize currencies, and obliged to destroy anything illicit after the prosecution is over.
Funny thought, most of EU LEA would have to accumulate those seize BTC until it is legally made a currency.
  • #1,542
  • Jan 17, 2014 5:33am Jan 17, 2014 5:33am
One step at a time. All targets at the moment are pointing South.
On the 4H chart I am aiming for 747. I think it's going to be slow & painful.
It amazes me somewhat with all the hype & big players getting on the Bitcoin band wagon & here we see Bitcoin following the Tech's to the letter.???
You would think the hype would be pushing it up at a fast rate of knots.
Attached Image (click to enlarge)
Click to Enlarge Name: btcusdh4.png Size: 41 KB
Money Makes Money
  • #1,543
  • Jan 17, 2014 5:43am Jan 17, 2014 5:43am
Quoting KiwiOz
One step at a time. All targets at the moment are pointing South. On the 4H chart I am aiming for 747. I think it's going to be slow & painful. It amazes me somewhat with all the hype & big players getting on the Bitcoin band wagon & here we see Bitcoin following the Tech's to the letter.??? You would think the hype would be pushing it up at a fast rate of knots. {image}
If it were to unfold the way you said, I wouldn't be surprised. News and hype are good indicator for long term trend confirmation.
On a daily, they can eventually mark a top (good news) or a bottom (bad news). But neither hype nor news can act as trend reversal (ie bad news don't make it go down, good news don't make it go up).
Sorry I'm reformulating again an old opinion of mine and I already detailed it too much previously

Edit : orderbooks has been halved on both sides since yesterday
  • #1,544
  • Jan 17, 2014 5:51am Jan 17, 2014 5:51am
Quoting lady_luck
Good morning, To me it's still very uncertain direction, 880 hasn't been broken on gox, that would be the trend reversal point toward KiwiOz analysis. Daily and 4h indicator are very low and pointing toward the upside. So, looking at 935 over there. A bit of a thought for DPR, have you guys ever heard about other SR arrest or BTC crimes ? I wonder what other LEA did with the seized BTC. Lot's of country don't have any sort of asset forfeiture program. They can only seize currencies, and obliged to destroy anything illicit after the prosecution is...

hi lady_luck,

Interesting point you make about the distinction between assets and currency. The seizure was ordered by the Manhattan U.S. Attorney’s office and the FBI must have had legal council before publicizing their decision to auction, so all-in-all I'm getting the impression that Bitcoin is being recognized as a currency (or at least, crypto-currency) by US State Law. They could have said they're just going to destroy the wallet, but selling it gives Bitcoin some legal standing, I wonder who will end up buying at a discount? Probably a single company.

I've never heard of any other BTC seizures besides Silk Road.
cryptocurrency everytime
  • #1,545
  • Jan 17, 2014 5:56am Jan 17, 2014 5:56am
Quoting venzen
{quote} hi lady_luck, Interesting point you make about the distinction between assets and currency. The seizure was ordered by the Manhattan U.S. Attorney’s office and the FBI must have had legal council before publicizing their decision to auction, so all-in-all I'm getting the impression that Bitcoin is being recognized as a currency (or at least, crypto-currency) by US State Law. They could have said they're just going to destroy the wallet, but selling it gives Bitcoin some legal standing, I wonder who will end up buying at a discount? Probably...
I've heard about a few arrest of SR sellers in an joint effort between German and NL LE, but I can't find any follow-up on the story.
http://www.dailymail.co.uk/news/arti...MDMA-hair.html
  • #1,546
  • Jan 17, 2014 6:06am Jan 17, 2014 6:06am
Quoting KiwiOz
One step at a time. All targets at the moment are pointing South. On the 4H chart I am aiming for 747. I think it's going to be slow & painful. It amazes me somewhat with all the hype & big players getting on the Bitcoin band wagon & here we see Bitcoin following the Tech's to the letter.??? You would think the hype would be pushing it up at a fast rate of knots. {image}

KO, you've got 99% accuracy with your method so I'm not going to oppose your analysis other than to say I see a perfectly completed triangle from the 990 (BTC-e) price high. That means this could be wave 4 completed and wave 5 to the upside must follow. However, from the perspective of your analysis forecasting more downside, I can see another count whereby another wave (wave C) is due to the targets you mention. So, I'm going to wait and see.

If PA drops below 880 (MtGox) and 800 (BTC-e) then it's hedge time again for me.
cryptocurrency everytime
  • #1,547
  • Jan 17, 2014 6:16am Jan 17, 2014 6:16am
Quoting lady_luck
{quote} I've heard about a few arrest of SR sellers in an joint effort between German and NL LE, but I can't find any follow-up on the story. http://www.dailymail.co.uk/news/arti...MDMA-hair.html
I remember this story - funny that it just evaporated!

Well, my uncle says it like this:

Inserted Video
cryptocurrency everytime
  • #1,548
  • Edited 6:29am Jan 17, 2014 6:19am | Edited 6:29am
Quoting venzen
{quote} KO, you've got 99% accuracy with your method so I'm not going to oppose your analysis other than to say I see a perfectly completed triangle from the 990 (BTC-e) price high. That means this could be wave 4 completed and wave 5 to the upside must follow. However, from the perspective of your analysis forecasting more downside, I can see another count whereby another wave (wave C) is due to the targets you mention. So, I'm going to wait and see. If PA drops below 880 (MtGox) and 800 (BTC-e) then it's hedge time again for me.
If PA drop below 880, slow and painfully, I'll do the same, but since I've been very wrong the past two month, I'll try a new strategy.
I'm not going to "hedge" with USD but with LTC, gonna try to do some charts superposition in the same way you did with XAU/BTC. And then try to confirm it with LTC/BTC.
Right now, It seems less risky to miss the bottom/top that way.

EDIT : If btc go below 600, LTC/BTC target would be 0.023, so from current levels I'm looking at 25% with the first and 20% with the second.
  • #1,549
  • Jan 17, 2014 6:38am Jan 17, 2014 6:38am
Quoting lady_luck
{quote} If PA drop below 880, slow and painfully, I'll do the same, but since I've been very wrong the past two month, I'll try a new strategy. I'm not going to "hedge" with USD but with LTC, gonna try to do some charts superposition in the same way you did with XAU/BTC. And then try to confirm it with LTC/BTC. Right now, It seems less risky to miss the bottom/top that way.

That'll be interesting, try it and see. I like hedging because I never get that hollow disappointment like when a stop gets hit and you see your account balance going down. With a hedging strategy I can make an even better entry in the original direction I'm trading and also make a small profit from the move "against" my original trade. Thing is that it's easy (for me) to get greedy with how much one can make on the hedge! With my BTC-e account hedging costs no additional margin so it's perfect for me - that is having a long (of say 0.1BTC) as well as a short (of 0.1BTC) in the same instrument incurs margin costs of only 0.1BTC overall. In this way there is always margin available to open another position no matter how far against me price moves. I just have to make sure that my initial position does not consume all my available margin. I usually make my initial 3 positions add up to about 50% margin and then I hedge if necessary.

If you're willing, it would be helpful if you share your hedging strategy. I came up with a strategy by myself and am not sure how other traders do it.
cryptocurrency everytime
  • #1,550
  • Jan 17, 2014 6:56am Jan 17, 2014 6:56am
Cryptocurrency use in Third-party Guarantor and Contract Escrow
http://www.coindesk.com/reality-keys...tor-contracts/

Now why not just use a tulip bulb to hedge that futures contract instead?
cryptocurrency everytime
  • #1,551
  • Edited 7:36am Jan 17, 2014 7:08am | Edited 7:36am
It works both way but here is an example :
Let's start with the context, let say I have : 1000ltc, bought them at 26 before it hit 31, didn't sell because I was expecting 35.
Now my position is still long, but considering that my target at 35 might not be hit by tomorrow, but instead we might even go lower.
The LTC/BTC ration is 0.029, I expect it to fall to 0.023 and then go up which is 20%.
I change my 1000ltc for a 75% position in btc, get 21.75btc and 250ltc.
LTC usually goes down further than BTC, so LTC become my short and BTC my long.
Because to quote you, it would be the same as having a long as well as a short within the same overall cost.
But the difference is that once the PA went either down or up, you can reverse the transaction by using LTC/BTC again.
Which is why 75% on the long is ok, because of this extra 20% I can get with LTC/BTC instead of 50%margin I only need 25%.

That's kinda required three brains to find the right %, so I didn't do it in the past, but a simpler way is to simply hold a majority of BTC, that can balance a short position on LTC, if it goes down you win with the short on LTC and you can change your BTC to LTC at a 20% discount (says 0.029-->0.023). If it goes up you win more with your long on BTC and can increase your gain with the SL on LTC when LTC/BTC goes back up.
So your SL are really important, so is the estimation of how much LTC/BTC will move if BTC goes up and if BTC goes down. And it only work when you are sure that LTC won't go up "faster" than BTC.

It's hard to explain, let me know if I wasn't clear at all (highly possible lol). But I think it might work because the same thing you saw on GOLD/BTC XAU/BTC happen with LTC, and because of the delay/anticipation and variance in amplitude of LTC toward BTC movement.
  • #1,552
  • Jan 17, 2014 8:28am Jan 17, 2014 8:28am
Quoting lady_luck
It works both way but here is an example : Let's start with the context, let say I have : 1000ltc, bought them at 26 before it hit 31, didn't sell because I was expecting 35. Now my position is still long, but considering that my target at 35 might not be hit by tomorrow, but instead we might even go lower. The LTC/BTC ration is 0.029, I expect it to fall to 0.023 and then go up which is 20%. I change my 1000ltc for a 75% position in btc, get 21.75btc and 250ltc. LTC usually goes down further than BTC, so LTC become my short and BTC my long. Because...

This is really interesting and I have to bend my head around it somewhat because there are layers and cross-relationships. I'll draw it out to visualize better. BTW - your LTC short - that must be a market order for USD, right? Does that mean the BTC long is held in physical coins? I ask because you mention changing your "BTC to LTC at a 20% discount (says 0.029-->0.023)". No sweat... just trying to understand because it's clever.

Right now, the BTC pairs are all down and declining a bit - but I'm seeing signs of reversal in my indicators so I'm going to let it ride and see if price pops back up above 900 (MtGox) and 800 (BTC-e/Bitstamp). I understand what KiwiOz is seeing and not all the BTC pairs show the same neat and tidy triangle, yet this is an odd setup for further decline - i'd expect a move up first if price was going to drop further...
cryptocurrency everytime
  • #1,553
  • Edited 8:51am Jan 17, 2014 8:38am | Edited 8:51am
Not necessary, but yes it's what I had in mind, short in USD and held physical coins.

I was looking at the curve of the "e" wave on gox, it does match the curvy shape, lengthier time and target you mentioned a few days ago. But yesterday i also saw those not so clear triangle you just mentioned.
  • #1,554
  • Jan 17, 2014 9:08am Jan 17, 2014 9:08am
Attached Image
  • #1,555
  • Jan 17, 2014 9:15am Jan 17, 2014 9:15am
The Nov high above 1000 then down to 400 area then back up and sideways reminds me very much of the action after the April high last year. Here is a chart from that time. In hindsight I would relabel like this:

  1. keep A as is
  2. change a/1 to B
  3. keep abcde as is (this is wave C) and end of correction.

http://ubuntuone.com/5hR7eJnwjBzTGMWwcIYBFV

cryptocurrency everytime
  • #1,556
  • Edited 9:37am Jan 17, 2014 9:26am | Edited 9:37am
So if I understand well the parallel, we are now heading down toward "e" to complete the b/2 equivalent, C ?
  • #1,557
  • Jan 17, 2014 10:13am Jan 17, 2014 10:13am
Quoting lady_luck
So if I understand well the parallel, we are now heading down toward "e" to complete the b/2 equivalent, C ?
I think we might be completing "c" now.

"d" and "e" will follow.

I'm not sure but the way PA is making small waves and winding sideways... it looks like it needs more time to go a bit lower near 760 for wave "e". KiwiOz and emptymind have it going much lower so perhaps their targets will be achieved, but I'm sceptical about BTC making strong delcines once it's in this sideways mode.
cryptocurrency everytime
  • #1,558
  • Jan 17, 2014 10:18am Jan 17, 2014 10:18am
I agree with that, some might say that usually a textbook C wave cannot be a triangle, but I would also think that it might be the case here.
Mtgox is offering quiet a resistance at 885, it's interesting to watch.
  • #1,559
  • Jan 17, 2014 10:24am Jan 17, 2014 10:24am
described another way, this PA in jazz: small repetitive patterns winding slowly to a resolution somewhere lower down

Inserted Video
cryptocurrency everytime
  • #1,560
  • Jan 17, 2014 10:33am Jan 17, 2014 10:33am
Quoting lady_luck
I agree with that, some might say that usually a textbook C wave cannot be a triangle, but I would also think that it might be the case here. Mtgox is offering quiet a resistance at 885, it's interesting to watch.

You're right. A textbook wave C cannot be a triangle - must be an ending diagonal or impulse - except when it is a subwave of a triangle the it can be a zigzag or flat combination.

What is strange about this structure since the early Jan high is that wave A down was simple - 3 clear subwave with long candles. Then wave B up was more complex and next we saw really small complex waves forming 3wave structures. The wave down since yesterday is what? It's not clear if it's 3wave or 5wave or what... so we have to wait for more clarity...

edit: if the wave up from here is a clear 3wave structure similar to the "d" wave in the last chart I posted, then we have more reason to expect that long slow curved "e" wave down.
cryptocurrency everytime
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