For the first time i show here a monthly chart, now that we have enough data since July 2010 when MtGox opened its “doors”. After a 9 months strong advance from 0.06$ to 31.91$ BTC/USD entered in a bear market that lasted 6 months down to 1.99$ in November 2011, since then we have seen a very strong rally and two accumulation phases spent at 5$ and 10-13$ up to January 2013. This year behaviour has been extraordinary with prices advancing from 13$ all the way up to 266$ that i consider it an important top like the one seen in 2011. I don’t think that this year BTC/USD will go above 266$ again, what i expect now it is a mild correction.
Keep in mind that despite the massive negative money flow seen during the drop and record volume bitcoin is still well above 100$,because of this interesting divergence i don’t expect the same extreme correction happened in 2011; i’m more for a slow retracement with a final bottom above the 32$ 2011 top, and even above the recent 50$ double bottom.
Apart any considerations about volume activity there is also the fact that until mining power or network speed will not give signs of slowing down the price will not come down easily. In 2011 only in august the network speed started to fall and bitcoin crashed from 14$ to 2$ and even if now the network speed might slowdown and retrace a bit it is not excluded a flat phase of this market instead of a steep fall. It is interesting also that there are too many players out there waiting for a big drop to 30$ but the market isn’t here to satisfy all their desires and most of the time it follows its path and not what the masses expect.
Unlikely that there will be a repetition of 2011 “pump and dump” pattern but, just for your curiosity, it is easy to forecast the bottom, using a logarithmic scale and projecting the same extreme drop from this year top at 266$ the bottom should be around 18$.
Bitcoin Trading Ideas, Analysis 
> In 2011 only in august the network speed started to fall and bitcoin crashed…
What’s exactly the relation between network speed and course? I assumed the logic is reverse: course started to fall -> people stopped investing in mining -> network speed dropped.
In less than three hours we are going to have one of the biggest increase (ever?) in difficulty: from 12153411 to 15616378.
At present 25btc are mined every 7.7 minutes, as soon as the difficulty increases it will suddenly be every 10 minutes. This might be big enough to cause a noticeable price rise.
Regarding the increase/decrease in hashrate: it all depends on whether the added/removed miners are hoarders or sell straight away to USD.
In the next few months we are about to see a massive increase in miners due to BFL, Avalon and others delivering new batches of asics.
Whether this new wave of miners will be hoarders or sellers could be an important factor.
I agree with this assessment. I think as new ASICs come online, it will provide pricing support. It would not surprise me at all if Enky is completely wrong, and the linear upward curve we’ve seen in the Bitcoin market cap since February, continued on exactly the same trajectory.
But Enky, I’m a little unclear on your prediction. You think long-term, coins will stay above $50, but in the final paragraph you seemed to contradict this?
We already hit the bottom buddy. It was $50. You’re a little late to the party. The obvious projection was $18 or $33 but that time has passed. There’s so much more capital, ventures and plans around this now. Way too much to undervalue it like that. Bubbles burst and people panic and dispair, but that’s when it’s value is low or unrealized. We realized that it’s value already.
That’s quite optimistic point of view. But if you mention fundamental factors, I think it would be fair also to point out the increasing efforts of US authorities to complicate BTC using. If they decide, they can effectively shut down bitcoin market in the US – and that could / would be a significant hit to BTC value (if not fatal).
Thanks as always Enky 😀 Just wanted to reply to Adam. Imo I don’t think the US government wants to shut down bitcoin as it solves a fundamental economic problem clearly stated in Satoshi’s paper. It would be foolish for a country in economic turmoil to ignore an innovative technology. Cracking down on criminals and cracking down on bitcoin are two very different things.
Try this graph site out enky. I think you’ll like it.
https://www.tradingview.com/e/?symbol=MTGOX:BTCUSD
3nrg u made my day