The blue line has finally fallen (top one on my chart) with prices down over 10% at time of writing, which is a pretty massive drop after the recent ‘stability’. I’ve always thought the blue line was pretty significant level but even so, steepness of the drop has surprised me on this fall.

Heres how that break below looks on bitstamp with 4 hour candles.

The warning was there beforehand where I’ve marked ‘oops’ on my chart with a little arrow, apologies for not posting at the time last night, as I was too tired. But thats when I started to take notice and expect a drop, to me that signified a change in behaviour with chart becoming bearish even though at the time it had rebounded back above the blue line.

I’ve put a new blue line in the sand down at about $611 which I expect will provide strong support and a dotted line at about $675 which may provide support at a higher level if price can get above it.

Hard not to kick myself for lack of patience to be honest, I could have drawn a chart that looks a lot like this back in December, its playing out very similar to the April bubble collapse and other bull market tops which I’ve posted in the past and this drop provides no real surprise. Having bought back in at higher levels than this I could instead have waited for cheaper prices to come to me…

On the other hand I’m not going to beat myself up too much though. Leaving fiat money in a bank in this economy is a risk. ‘Bail-in’ has been legislated almost everywhere. Meaning when the next economic collapse shit hits the fan, it won’t be taxpayers bailing out failing banks it’ll be your deposits just like in Cyprus, which was the blueprint. So based on that thought I am happy to hold bitcoins in a falling market. I bought my very first bitcoins during the first bubble collapse and had to wait quite a long time before it turned out to look like a good idea. If that happens again, well, c’est la vie. Personally I see another run happening sooner than that though once this correction has ran its course.

9 thoughts on “Oops

  1. To me, this is just an artefect in a flat trend.
    MtGOx is temporarily halting all withdrawals, even BTC’s.
    If it faces a technical issues, everything will be alright soon. If they plan to go away with lugages full of bitcoins… that would be a very different story.

    I’m very focusing on hourly charts now. When I saw a significant candle higher than the previous one, I gonna buy few to make a sligh profit.

  2. people started noticing BTC withdrawals not going through around the 4th of Feb. Some people were able to follow data through the mtgox API that withdrawals weren’t being processed properly. Some were talking of mtgox insolvency, others Fed seizure etc and others this technical problem with withdrawals…. the usual FUD.

    Mtgox released a statement that they are attempting to resolve the issue and will halt all BTC withdrawals for now and will provide an update on Feb 10. Not a very calming imo to go through the weekend with that type of news. Weekends historically can provide significant drops only to rebound on Monday, curious how this will play out.

  3. The Biggest issue with Bitcoin right now – The Bitcoin ecosystem doesn’t know how to defend against future Mtgox clones.

    The biggest issue with Bitcoin right now isn’t the Apple store gatekeeper, not even the New-York regulatory debate, neither the Russia ban, or the China boycott and not even the Mtgox temporary pause, but it is definitely related to the Mtgox and all that happened there last months.
    No matter what the announcement of Mtgox at the beginning of this week, the Japanese Bitcoin exchange hurt the foundation of what Bitcoin is all about. From the beginning to the bitter end (?):
    – Bitcoins in Mtgox isn’t quick to trade.
    – It isn’t cheap to trade with Bitcoins because time is money.
    – Bitcoins isn’t safe there.
    – When Mtgox, with the rules they wrote for themselves, are still in the game, Bitcoin is very centralized. Ask the people who have money there.
    – And the most important thing Bitcoins ecosystem doesn’t know how to defend against future Mtgox clones. And why would they.. as they will be here sooner or later, because when you give to someone or a very small group of people, the ability to print money without being arrested, you can’t expect them not to use it. This is human nature in the western capitalistic world.. come-on..
    If someone didn’t understand how Mtgox created the option to print money without being arrested.. Prima facie, and via many bloggers – If you are the Bitcoin stock exchange and you hold people’s money and don’t transfer them out of your stock exchange, you create higher Bitcoin prices. When you have this arbitrage and you control who will receive money after he sells his Bitcoins, theoretically, you have a machine that prints money with less energy than the dollar printing machine.

    The organization of Bitcoin needs to find a solution for the last problem. Fast. Or the end of the Bitcoin will be the same as that of Mtgox.
    With their silence, the Bitcoin organization gives a backup to members of them but at the same time they give a Cold shoulder to the entire community of the Bitcoin.

    1. There is work being done to create peer-to-peer exchanges. I think this will solve the problem of fees and arbitrage. There are some very interesting threads about this stuff on bitcointalk forum.

      1. I think Ripple is promoted as peer to peer exchange although as I’ve written about i have quite bit reservations about ripple. Something needs to change though, bitcoin exchanges are the most vunerable point for so called ‘authorities’ to attack. Gox yet again at the centre of it. I like the local bitcoins model myself as dependence on 3rd parties is much much less.

        On the bitstamp chart, support looks to be holding where my blue dashed line was so far.


  4. Maybe we are back into some kind of new “long term channel”??

    (the blue one, the pink is the old one).

    Time will tell.

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