Quote from: rpietila on December 28, 2013, 12:53:54 PM

Quote from: rpietila on December 28, 2013, 12:04:22 PM

The official December update is coming at the end of December. My current trendline which is calculated from daily prices until 15.12.2013, shows that we are at $469 now. We have not yet had any daily breaches of the trendline since the latest bubblepop.

Many have wondered, whether the trendline approach was able to cope with the extreme price movements of the 2011 bubble. It is true that during the move up, it was not possible to deduce anything from the trendline, which had just started to form. But during the move down, it called the bottom with almost deadly precision: the trendline was crossed down in 7.10.2011 (note: 4 months after the top) when the price was $4.29. The buy-level, which is -0.2 log units below the trend, was reached 17.10.2011 at $2.85. On a daily level, the bottom was reached 2 days after, at $2.28. At that point we were -0.341 units below the trend.

In 2013 April bubble, the final capitulation played out as follows: trendline was crossed in 3.6.2013 at $119, buy-level of -0.2 was reached in 1.7.2013 at $90, bottom was in 6.7.2013 at $69 at -0.341.

I am sure that -0.341 as the daily average of the most opportune day to buy, months after the bubble, is pure coincidence

Nevertheless, it gives confidence to those who do not decide to invest all after a runup, fearing to be left behind. If we expect the final capitulation to come on the red candles' day (14.2.2014), it is still possible to buy back in between $308-$427 if the previous bubbles are any guide.

This is to refute oda.krell who does not base his predictions of "trends" on anything, I at least try. Nobody has shown any proof on any trend other than this, except lines drawn on a whim. I don't understand much, but there is a great difference between founded and unfounded prediction.

It is very easy to buy at your desired level btw. It is called "limit order".

Yes you try (which is commendable), and you're likely to be right here >50% of the times as well

. Still, I think it's a bad decision because of the combination of the extreme growth rate of Bitcoin and the short term unpredictability of the market. What you need is to for the market to return to the trend line within in a certain time frame. This is also true if you're looking to buy a good growing company cheaply enough: the underlying valuation grows while you wait to buy and the price may stay above this point for a longer time than it takes the valuation of the company to match the original buy price you could have bought at!

Still I would not be advocating buying the stock above the fair value you calculated. Why am I doing this for Bitcoin then? (if we assume the trend line is a valid approach for modelling this). Well, nothing in the world grows so fast as Bitcoin. This causes 2 things. Firstly, the time until the underlying valuation will have reached today's price is relatively short. Meanwhile the market could easily go to $10,000 and stay there for 2 years (then again it could do the same with $100 as well). Secondly there are no alternatives. If you are unable to buy wonderful company A at the price you like, you just move on to wonderful company B. BRK has a long term yearly growth rate of >15% and that's amazing. This is however nothing in comparison with Bitcoin. The potential lost opportunity cost of not investing in Bitcoin today are just too big because of this.

;TLDR Not being in Bitcoin today is too risky.