The surge from $6600 to $8300 got the usual losers in a frenzy on twitter and elsewhere. Such celebration will be short-lived because the sellers who drove the price from $11600 to $6600 are still here, and they continue to unload Bitcoin in 300-500 coin chunks at periodic intervals as shown below:
Bitcoin spent 2 years from mid-2014 to 2016 in a consolidation pattern. We’re not even at that point yet of consolidation:
The downward trend is fully intact. Until it enters a consolidation phase, we cannot even begin to talk about bottoms. It’s going below $4000 and maybe even $2000 soon. If you are buying Bitcoin at these levels, you are, to put it bluntly, stupid and will lose a lot of money. If you take your financial advice from Twitter losers and TV talking heads, you are also stupid. The first rule of making money is to not be stupid.
If you take anyone who shows log charts of Bitcoin seriously, again stupid. If log trends could be extrapolated to the future, Bitcoin would be infinity next decade. The correct function is a logistic curve, which no one talks about. Everyone just shows this dumb log extrapolation. To understand why this is wrong, regarding Bitcoin, the years from 2009-2013 can be treated as an anomaly and will not be replicated. Imagine if something goes from $0 to $1 overnight. The gains would be infinite, so one could extrapolate infinite gains to the future based on the log growth. Obviously that is wrong. If something goes from a penny to $10 in a 1-month period, and then spends the next 10 months going to $20, then it’s as if the $.01-10 part is irrelevant. When one exudes the 2009-2013 period from Bitcoin’s performance, the growth is much more underwhelming and worse than index funds on a risk-adjusted basis.