Mixed Signals

After signs of weakness with price falling below my blue line of support I called for cheaper bitcoins. So what happens? A rally which breaks up through the red dotted line of course.. duh! Heres what my chart looks like with that break up through the red dashed line of resistance.

Notice I’ve included momentum indicator, looks like the dips are losing momentum. Which I’ve marked with a blue dashed line. More expensive bitcoins on the way ?? Even if there is, how long will the rally last until we turn bearish again?

I feel a bit like the longer this market indecision lasts the less likely it is that bitcoins will see a significant drop in value. But then again, what do I know I’m just a guy on the internet.

To be honest I just feel like forgetting trading bitcoins, and in fact have stopped making trades. Until I feel like I know the overall market sentiment I’m not buying or selling anything, fed up with constant mixed signals in this market. Is it bullish or bearish ? On such low volume with relative small market cap how can anyone predict what will happen next?

15 thoughts on “Mixed Signals

  1. I think this is simply because the bitcoin market is too unstable this days. It’s receiving too much attention, and there is a lot of people trying to make quick money buying / selling today. Good for them, if the know how to!! 😀

    In my case, every time I tried to, I did the exact oposite: I lose money / bitcoins! 😀

    Y think we need to go back to the kind of movements that where happening starting november 2013.

    Any short term predictions today will have a big chance of error.

    Talking about momentum, the last six months of it:

    I think the only valid prediction is that this should be back to normal in no more than a month…. and when it stays like that for at least two weeks, we can jump back into the bitcoin train 😛 (at least that’s my case, at this moment I don’t have a single hatoshi).

    My only hope is that MTGox will be a good “bank” for me…. because here in Argentina is extremely hard to have, hold, or buy USD if you are a common citizen.

    Let’s see what happens.

    Thank you again for your blog, and sorry again for my english.

    1. Mt gox has been a nightmare for me. when it comes to Bitcoin they are as good as any, transfers are immediate and the site has been very good for buying and selling. However, when it comes to fiat, they are a disaster. For me, I am waiting 3 months now for a deposit that is lost seemingly into thin air. For many others, they wait and wait and wait for withdrawals that are capped at a small $10k a month.

      I think this last month of indecision has happened only because the exchanges are so poor. Otherwise, I really believe confidence would be higher and so would Bitcoin.

      If only we had a crystal ball 🙂 is Bitcoin creating a future that will make us all laugh at the uncertainty we now feel, or is Bitcoin spreading the tea leaves of its eventual demise. Who knows.

      1. Well…. for me, living in Argentina, it’s almost imposible to make deposits or withdrawals in USD to anywhere … so MTGox been slow with that is not a problem for me actually. As long as deposits and withdrawals in BTC were working Ok, that’s enough for me.

        The day I’ll need to convert to cash my BTCs, I think I will sell it locally here… face to face.

      2. I’ve never used MtGox but imagine it could be used for trading until you want to cash out some fiat. In which case could you send bitcoins to LocalBitcoins and sell them there?

    2. For me holding on MtGox seems like a risk i wouldn’t like to take. I hold bitcoins in my own encrypted wallet, and I trade using localbitcoins. I like to minimise my exposure to 3rd parties as much as possible.

      1. Local bitcoin is not a security.
        Btc buyers can give you forged notes and btc sellers can send you wrong bitcoins: I have a friend who has been buying and receiving bitcoins through localbitcoins. Sometime after he has been telling that his new bitcoins were stolen or forged and then these bitcoins disapeared from his wallet.

      2. Not sure what you mean to be honest. I transfer my bitcoins out of localBitcoins into my own wallet. Also how can you forge bitcoins??

      3. The wallet of my friend is at MtGox. I trust my friend who never buy bitcoin again through localbitcoin.
        If you use only localbitcoin, you can hardly multiply your number of bitcoins just after peaks having been reached.

      4. Using the exchange to hold your bitcoins requires a lot of faith. I learned the hard way when I lost almost all my bitcoins (at the time) on bitcoinica, which was hacked/stolen from. This is why I don’t hold bitcoins on trading platform.

        LocalBitcoins is not very good for short term trading as you say but for long term trades it works fine. I enjoy the security of knowing my bitcoins are in my control.

        However I might decide to use a trading platform for some shorter timescale trading with smaller amounts. There are not very good options for GBP though.

      5. I did a mistake. Someone has been selling linden dollars to my friend. These linden dollars were bought with a stolen credit card. Therefore these linden dollars disapeared from the wallet of my friend.

  2. Talking about volume, bitstamp is looking like it’s getting more liquid than Mtgox. There seem to be some huge whales on mtgox probably because it was the original exchange for bitcoin, nonetheless it appears as if mtgox is tapering in user base perhaps. Looking at huobi the consistent trading volume is impressive with a very small price difference between bid/ask.

    It gets a little annoying seeing the manic sized candles on the mtgox charts compared to those on huobi…

  3. Spot on. This is why QRK and DOGE are jumping, IMO– anticipation of extra BTCs hitting the mkt will hurt its relative valuation, albeit only for a brief period. Likelihood of ever being declared illegal has certainly dropped, but it doesn’t guarantee “they” won’t make it increasingly difficult to transact. After a snafu with ebay and paypal, I most assuredly assert NOT every point-of-sale company will be getting on board. Quite the contrary. These fore-mentioned behemoths spouted pure FUD via their support reps about why they do not protect digital currency sellers from fraud. Obviously they are under pressure from above not to adopt the technology.

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