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Reasons why you should NOT trade cryptocurrencies

Matt (BluePanther)
Nov 21 2018 at 13:17
posts 1357
Farhan1 posted:
Could be a good buy low - sell high opportunity. There is still a lot of hype around crypto. If buyers start coming in around 4000k thinking that it is a cheap time to buy then the price could sky rocket again

Opinion: Victims of bitcoin insanity are quickly piling up (Nov 20, 2018)
Ivan Martchev (Investment strategist)

'Chipmaker Nvidia last week issued revenue guidance for the current quarter of $2.7 billion, falling well short of analysts’ consensus estimates of $3.4 billion. The culprit? The deflating bitcoin bubble!

Some explanations for earnings and revenue warnings you just can’t make up.

The global cryptocurrency mania — not only for bitcoin BTCUSD, +4.79% but similar absurdities — led to strong demand for graphics processing units (GPUs), which Nvidia is a leader in, as they are used to run the computations necessary to “mine” cryptocurrencies. As the air has rapidly left the global crypto bubble, mining those worthless lines of code has gotten less lucrative and, hence, the demand for GPUs has rapidly declined.'

'...As I’ve explained previously several times, the term “market cap” when used to describe a cryptocurrency is absurd. Market cap is short for “market capitalization,” or the total worth of all publicly traded stock of an operating company. It is supposed to discount all earnings (or cash flows) as far as all investors in the company’s stock (dubbed “the market”) can see and, thus, value the company that way.

The way we know bitcoin, and all other cryptos, are a bubble is by making the glaringly obvious observation that they cannot produce any cash flow whatsoever, making the term “market cap’ absurd. That’s not to say blockchain as a technology cannot be useful without the unnecessary step of buying a digital token called bitcoin, which is calculated to limit the amount of bitcoins at 21 million and thus make their price rise as more poor souls cram themselves into this line of code in search of riches. (For more, see “Bitcoin is perfectly tracking major bubble phases.”)

As history has proven on multiple occasions, most bubbles end with the majority of investors losing massive amounts of money as they hold and hope for the bubble to reflate. Regrettably, after bubbles pop, they can take decades to recover and “take out” the bubble price high, or, worst-case scenario, disappear. I think bitcoin will be a worst-case scenario situation.'

'...To be absolutely clear, I will never make an investment by looking at a chart alone. I have to understand what makes the chart “tick” and what makes an investment, as in the case of specific stocks, rise or fall. Since there never will be any profits, or cash flows for that matter, generated by bitcoin, ever, it is conceivable that it will go to zero, nada or nil. It does not take a genius to figure that one out.

That said, let me put my amateur technician’s hat on. It appears that bitcoin has broken below a major support level at $6,000 (see chart). The chart shows declining peaks and even lows that got taken out last week at that key level. If one reads the chart as $6,000 being the climactic low that was hit after the top was set on Dec. 18, 2017, and $12,000 is the first major rebound off that climactic low, then the bitcoin chart has formed a “bearish wedge,” or a “descending triangle” pointing from $12,000 to $6,000. The measured move of that breakdown is $6,000 (or the width of the triangle) below the support level of $6,000.
Matt (BluePanther)
Nov 21 2018 at 13:22
posts 1357
togr posted:
BluePanther posted:
'Left holding the bag':
https://en.m.wikipedia.org/wiki/Bagholder

Well BTC is still 4 times the value compared to MAR 2017

Well BTC has lost 70% since its high
kieran (snapdragon1970)
Nov 21 2018 at 18:11
posts 1948
Only smart way to trade Bitcoin was at the start with an amount you can afford to lose same as any investment.
"They mistook leverage with genius".
vontogr (togr)
Nov 22 2018 at 08:30
posts 4862
BluePanther posted:
togr posted:
BluePanther posted:
'Left holding the bag':
https://en.m.wikipedia.org/wiki/Bagholder

Well BTC is still 4 times the value compared to MAR 2017

Well BTC has lost 70% since its high

You do not get it.
BTC has lost value this way more times and it always end up much stronger.
Matt (BluePanther)
Nov 22 2018 at 11:19
posts 1357
togr posted:
BluePanther posted:
Well BTC has lost 70% since its high

You do not get it.
BTC has lost value this way more times and it always end up much stronger.

Thanks. I appreciate your optimistic opinion, but your post is better-suited for the thread: https://www.myfxbook.com/community/general/trading-cryptocurrencies-bitcoinetherium-litecoin-etc/1513362,1

This thread does not condone trading cryptocurrencies.
Matt (BluePanther)
Nov 22 2018 at 11:19
posts 1357
togr posted:
You do not get it.
BTC has lost value this way more times and it always end up much stronger.

Are you looking purely at technicals? Because with any market instrument the fundamentals must support the valuation - and unless world economies fundamentally change then crypto will remain a niche with little practical value, and hence lower worth.

The hype and craze is fading, and the underlying fundamentals are becoming conspicuously apparent.
Matt (BluePanther)
Nov 22 2018 at 11:20
posts 1357
togr posted:
You do not get it.
BTC has lost value this way more times and it always end up much stronger.

Are you looking purely at technicals? Because with any market instrument the fundamentals must support the valuation - and unless world economies fundamentally change then crypto will remain a niche with little practical value, and hence lower worth.

The hype and fantasy is fading, and the underlying fundamentals are becoming conspicuously apparent.
Matt (BluePanther)
Nov 22 2018 at 11:24
posts 1357
Well BTC has lost 70% since its high:



Fichiers joints:

FuYating
Nov 22 2018 at 11:26
posts 11
Bitcoin is hear to stay and has become more a more mature market now. Just because the S&P falls 70% we don't assume that it will go to zero. I see this as a good place to buy. If price falls further then I will be buying more
vontogr (togr)
Nov 22 2018 at 13:16
posts 4862
BluePanther posted:
Well BTC has lost 70% since its high:



And it gather 20,000% since its low :)
vontogr (togr)
Nov 22 2018 at 15:30
posts 4862
BluePanther posted:
FuYating posted:
Bitcoin is hear to stay and has become more a more mature market now. Just because the S&P falls 70% we don't assume that it will go to zero. I see this as a good place to buy. If price falls further then I will be buying more

togr posted:
And it gather 20,000% since its low :)

So you are bullish BTC, so compare this:
USDTRY is currently trading around 5.28 after reaching a high in August 2018 of approximately 7.10.
BTCUSD is currently trading around 4500 after reaching a high in December 2017 of approximately 19,140.

In other words:
The Turkish Lira (TRY) is converted 5:1 into USD.
BitCoin (BTC) is converted 4500:1 into USD.

The value of the Turkish Lira (TRY) is based upon financial confidence in its economy using tangible metrics.
The value of BitCoin (BTC) is based upon pure expectation and speculation as an acceptable form of payment, using many intangible metrics.

'This also doesn’t satisfy what gives Bitcoin a “floor” in value, but then an equity never has a floor. Equity can go to zero, but that doesn’t mean that in the meantime it’s not worth something.'
https://www.businessinsider.com.au/why-bitcoin-has-value-2013-12?r=US&IR=T

I did not say I am bullish.
I said there is no need to panic.
As BTC is such volatile instrument it can lose 75% of its value and recover.
Matt (BluePanther)
Nov 23 2018 at 09:28
posts 1357
BluePanther posted:
The Turkish Lira (TRY) is converted 5:1 into USD.
BitCoin (BTC) is converted 4500:1 into USD.

Correction and clarification:
5 TRY = 1 USD
1 BTC = 4500 USD
Matt (BluePanther)
Nov 23 2018 at 09:32
posts 1357
FuYating posted:
Bitcoin is hear to stay and has become more a more mature market now. Just because the S&P falls 70% we don't assume that it will go to zero. I see this as a good place to buy. If price falls further then I will be buying more

Your analogy is poor. You must realise:

The “S&P” is an index, an aggregate of multiple independent instruments: “The Standard & Poor's 500, often abbreviated as the S&P 500, or just the S&P, is an American stock market index based on the market capitalizations of 500 large companies having common stock listed on the NYSE or NASDAQ” (https://en.m.wikipedia.org/wiki/S%26P_500_Index)

BitCoin is a single individual instrument: “Bitcoin (₿) is a cryptocurrency, a form of electronic cash. It is a decentralized digital currency without a central bank or single administrator that can be sent from user-to-user on the peer-to-peer bitcoin network without the need for intermediaries.” (https://en.m.wikipedia.org/wiki/Bitcoin)

You are comparing “apples” with “oranges” - there is no comparison.

My point is:
- the S&P has 500 separate components which would need to concurrently become worthless for S&P to lose value;
- BitCoin is a single instrument and the greater potential to become worthless.
Matt (BluePanther)
Nov 23 2018 at 09:39
posts 1357
snapdragon1970 posted:
Only smart way to trade Bitcoin was at the start with an amount you can afford to lose same as any investment.

'Only smart way to trade Bitcoin was at the start...' Same as any ponzi scheme or HYIP.

'...with an amount you can afford to lose' Wise words: nothing is guaranteed in life except death and taxes.

'...same as any investment.' Cyptocurrency cannot be termed an 'investment' in the true sense of the word:
https://www.investopedia.com/terms/i/investment.asp (refer Investments and Speculation)
Matt (BluePanther)
Nov 23 2018 at 09:39
posts 1357
Bitcoin on the verge of sliding below $4,000 as crypto collapse resumes (Nov 20, 2018)
https://www.marketwatch.com/story/bitcoin-extends-plunge-drops-another-10-2018-11-20

Bitcoin below $5,000 as bloodbath continues (Nov 19, 2018)
https://www.marketwatch.com/story/bitcoin-skid-continues-hits-13-month-low-2018-11-19

Opinion: Victims of bitcoin insanity are quickly piling up (Nov 20, 2018)
https://www.marketwatch.com/story/victims-of-bitcoin-insanity-are-quickly-piling-up-2018-11-20

Fear, Loathing and Opportunity: How Crypto Traders Are Handling the Drop (Nov 21, 2018)
https://news.bitcoin.com/fear-loathing-and-opportunity-how-crypto-traders-are-handling-the-drop/

Crypto scam artist faces up to 20 years in prison (Nov 19,2018)
https://www.marketwatch.com/story/crypto-scam-artist-faces-up-to-20-years-in-prison-2018-11-19
Allan (Arcferreira)
Nov 23 2018 at 09:50
posts 50
togr posted:
BluePanther posted:
togr posted:
BluePanther posted:
'Left holding the bag':
https://en.m.wikipedia.org/wiki/Bagholder

Well BTC is still 4 times the value compared to MAR 2017

Well BTC has lost 70% since its high

You do not get it.
BTC has lost value this way more times and it always end up much stronger.

It is not wise to HODL something under 200 daily SMA. This line is the Aqueronte river in TA.
Trade safely... Remember, a high Drawdown means a high risk!
kieran (snapdragon1970)
Nov 23 2018 at 13:05
posts 1948
There are safer things to invest in ,why risk your money on Crypto , its kind of wishful thinking.
"They mistook leverage with genius".
kieran (snapdragon1970)
Nov 23 2018 at 13:10
posts 1948
BluePanther posted:
snapdragon1970 posted:
Only smart way to trade Bitcoin was at the start with an amount you can afford to lose same as any investment.

'Only smart way to trade Bitcoin was at the start...' Same as any ponzi scheme or HYIP.

'...with an amount you can afford to lose' Wise words: nothing is guaranteed in life except death and taxes.

'...same as any investment.' Cyptocurrency cannot be termed an 'investment' in the true sense of the word:
https://www.investopedia.com/terms/i/investment.asp (refer Investments and Speculation)

Its actually worse than a Ponzi scheme.
"They mistook leverage with genius".
Matt (BluePanther)
Nov 25 2018 at 07:27
posts 1357
togr posted:
As BTC is such volatile instrument it can lose 75% of its value and recover.

I cannot tell if you are being sarcastic or serious. 😕
Hannibal55
Nov 25 2018 at 07:38
posts 7
Is 200 MA really that important? I have tried adding it to my charts and I never really see any resistance around it. That is for Forex not crypto though
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