When a worthwhile Futures market hits, then BTC will really stabilize.<p>He's right. Without shorting, options, and future contracts... it becomes impossible for BTC to stabilize in the wake of media exposure. Add on to the fact that the majority of BTC users seem to be idiots (ie: they look at the price as some sort of indicator of BTC penetration, as opposed to more useful statistics), and you've definitely got a situation where bubbles will continuously form.<p>Anyway, I don't necessarily think he's right. There will always be some function that fits some data... and he may have gotten lucky this time that data fits his model. Either way, it is certainly an interesting piece to read. And his model seems to have solid theory behind it.
<i>What can we learn from this? You can see a “fair value” of around $20/BTC due to be hit in a few weeks, with perhaps a full mean reversion to $10/BTC. </i><p>We now have a testable prediction. Let see if bitcoin actually falls to to 20 and 10 dollars per bitcoin within 4 weeks.
Having not heard of this model before, I'm very surprised how tightly the curve fits, to the point of being sceptical (it's even got the "little" ups and downs" it seems).<p>Traditionally, the idea with a bubble is that everyone (well, almost everyone) knows it's a bubble, but no one seems to know when it will pop or how far it will fall.<p>Would this same model have fit the 2008 stock market collapse? Would it have accurately showed when and where the bottom was?<p>Would this same model have fit the BTC curve as well if the dataset had started 100 or 200 days earlier or later?<p>Just some curiousity about a model I'm hearing of for the first time.
Are prices only well described by log periodic power laws if market participants don't know they are well described by log periodic power laws, or does that make things more complicated?
Technical Analysis is the Homeopathy of the financial world, just an "advanced" kind of scam using some basic maths...<p><a href="https://en.wikipedia.org/wiki/Random_walk_hypothesis" rel="nofollow">https://en.wikipedia.org/wiki/Random_walk_hypothesis</a><p><a href="https://en.wikipedia.org/wiki/Nash_equilibrium" rel="nofollow">https://en.wikipedia.org/wiki/Nash_equilibrium</a><p><a href="https://en.wikipedia.org/wiki/Efficient-market_hypothesis" rel="nofollow">https://en.wikipedia.org/wiki/Efficient-market_hypothesis</a><p>I though you guys were more smart than this.
There has been lately some legitimate-looking companies starting options-markets:
<a href="http://forexmagnates.com/ig-groups-launches-bitcoin-binary-option/" rel="nofollow">http://forexmagnates.com/ig-groups-launches-bitcoin-binary-o...</a><p>And also a new funded startup coming:
<a href="http://siliconangle.com/blog/2013/04/11/coinsetter-the-newest-bitcoin-forex-seeks-a-niche-in-the-wild-market/" rel="nofollow">http://siliconangle.com/blog/2013/04/11/coinsetter-the-newes...</a>