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Topic
Board Speculation
Topic OP
Stupid question
by
moravian
on 19/06/2014, 18:54:10 UTC
I have one very stupid, amateurish question to ask... regarding some fundamentals.
I know when a lot of people buy bitcoin (or anything else), the price is expected to rise.
Also when a lot of people sell it, the price is dropping.

However, each transaction has 2 sides. If you sell, you must sell TO SOMEONE, and that person BUYS, the exact same amount that you sell.
Also, when you BUY bitcoin, you buy it from someone, who sells it to you...

Also, it would be logical to say that whenever buying rises, the selling rises for the same amount, and vice versa.
Actually, the amount bought and amount sold, at any moments are the same.

So how can then selling push prices down and buying push them up?

I understand that with buying "new cash enters bitcoin economy" for example, if I buy, I spend cash on bitcoin, and bitcoin economy gets stronger for my amount of cash.

But what actually happens. At the same time someone SELLS that bitcoin to me. So there are actually 2 events... or each transaction has two sides. Cash actually goes into his pocket.

Now I guess if buyer initiates transaction, he maybe needs to accept slightly higher price, so if it starts from buyer, this is that pressure that drives prices up. And if seller initiates transaction, he can accept slightly lower price, which pushes the price down...

I am not sure if this is good understanding...