Waveaddict, what do you think the implications of a U.S. taper will have on the value of bitcoin?
Asset prices are falling, Gold, Stockmarkets are falling. Bond Yields are rising sharply.
Bullard came out and said there will be a taper. Bernanke quoted indirectly that a taper was coming.
U.S. debt is being reduced to serviceable levels. Government programs are being cut in the U.S. Defence spending down 30%. Food stamps being cut and more.
Looks like we will all be praising the central banks for reducing dollar money supply whilst bitcoin's supply keeps growing as people mine more.
It's all relative, but it looks like a good time to short bitcoin, either through lending schemes or funds like bitcoin investment trust.
Anyone up for some activist investing?
From a fundamental point of view, a taper would push US treasury yields higher along with the US dollar. The combination of higher yields and a stronger dollar should pull the US stock market lower. Because bitcoin generally follows the overall trend of the US stock market, bitcoin should continue lower as well in this scenario. Although a lot of you guys believe that bitcoin is somehow different and excluded from overall risk trends, if the overall speculative environment turns bearish (the US stock market is an excellent barometer for risk-taking), bitcoin is going to suffer because bitcoin is undeniably a risky investment which people flee from during bear markets.
From a technical point of view, I would be doing a disservice to my subscribers if I elaborated.