RE: The price of Bitcoin hasn't been fun, but have some perspective
Technical analysis was completely discredited in the 1970's by the emergence of the efficient markets hypothesis and dozens of empirical tests published in refereed journals such as the Journal of Finance. I am not current in that literature, but when I studied the field at the University of Chicago, the empirical work revealed some minor anomalies but otherwise failed to reject the hypothesis that all available information is quickly (nearly instantaneously) incorporated into the current price.
The "chartists", as they are called, are making a comeback in places like steemit, with analyses that are laughable to people trained in finance but who appear to have large followings in places like steemit.
The basic problem with technical analysis, and in particular with analyzing charts, is that if it worked, the smart money (institutional investors) would within minutes move massive amounts of money into or out of a particular asset in order to exploit the opportunity. Such actions would immediately eliminate the opportunity.
This is an example of a general proposition in economic theory, which is that there are no unexploited profit opportunities.
If you want to gamble with your money, take it to Las Vegas. At least there you can stay in a nice hotel, eat good food, and gawk at pretty women who smile at you while you throw your money away.
Laying down the cold hard truth. I like it.
"Get rich quick" schemes usually work very well... for the people who sell them or have a stake in promoting them. Fools rush in.
I'm not making a prediction. Just commenting on the current character of the market.
@ideafarm
Although I'm in agreement with most in your statement I cannot agree with leaving your money in the hands of "financial professionals".
Most of the youngsters that made millions in bitcion did it without any advice from a financial professional and most financial professional out there won't give you sound advice or make you money. If you know of one that actually makes you money let me know.
Agreed. I don't even open posts like that.
And do a lot of research. One of the best posts I've seen is one by @lukestokes - Did You Know You're Part of a Financial War?
The most interesting part for me in that post is a source article that was written by Super Crypto on the Medium platform - 4th Dimension: Bitcoin-Manipulation-Cartel — Price-Suppression is their Goal which explains the dip and pulls it through to Gold in Silver. This, for me, is by far the best explanation of the current situation because in the real world (one outside the programme) Gold & Silver is the only true money out there.
Very interesting read if you have the time.
Sorry for being unclear. I was saying that you should not be speculating in cryptocurrencies if you have not been trained in finance and you do not know what the "efficient markets hypothesis" is or what the Sharpe-Lintner capital asset pricing model and the Black-Scholes options pricing models are.
I'm not making any predictions here. Just warning people to not get suckered. I haven't yet seen a single analysis here of cryptocurrency market prospects that is worth the paper that it's printed on.
History tends to repeat themselves forming trends over time. Bitcoin has fallen 80% on five seperate occasions, there is no reason to believe there will not be a 6th and it’s time to load the boat because then there will likely be another 50X gain again.
Headed lower still.
If you're not a financial professional, you should not be speculating in cryptocurrencies (or in any other asset). Persuading amateurs who do not know what they do not know to purchase substantial amounts of, say, Bitcoin, on the expectation that they are going to get rich, is just as much a sucker's game as the promotion of penis enlargement cream (and the many other scams) is on Fecesbook.
What? Non-financial advisors speculate everyday and do quite well, in fact some outperform major “financial advisors”
I’m not sure what you are getting at, basically your saying people who arent financial advisors shouldn’t buy stocks, which is dumb.
You don't seem to be comprehending what I am saying. Do you know what an "institutional investor" is? Do you know what the Sharpe-Lintner capital asset pricing model is? How about the Black-Scholes options pricing model? The efficient markets theory and the evidence that supports it (along with some evidence that rejects it)?
There's nothing stupid or foolhardy about being a normal "buy and hold" investor without knowing these things. Normal people who want to invest in, say, common stocks, can do so and are likely to do just fine if they do some research about the companies that they invest in and they diversify their portfolio. Paying a financial advisor can be helpful in designing a portfolio that has the appropriate amount of risk for your situation. (But be wary of advisors who are paid commissions to push particular stocks.)
Speculating is a different game. Speculators bet against the market. Speculating is foolish when the speculator is not trained in finance. In contrast to normal investing, speculation is a professional's game.
If you think that, say, Bitcoin, is going to rise 5000 percent over the next year, and so you buy all of the Bitcoin that you can afford, then you are betting against the market. You are speculating. And you are a fool, unless you are trained in finance and you have inside information.