Donkin's Blog

Ode to the Bitcoin Bears

Can’t talk to a poker player nowadays without talking about Bitcoin. Frustrating for me, as I mined Litecoin back in 2014, tinkered with trading some ICOs, and ultimately decided the market was not worth my time. You were either speculating in the value of cryptocurrency or the business didn’t make much sense. This is coming from a former programmer who delved into the blockchain mechanics and proof of work algorithm that makes it all work, but I won’t bore you with that.

Besides, Bitcoin has entered into the realm of belief now. If you believe in it, nothing will persuade you. If you don’t believe it, likewise, your money is not going anywhere near it.

The price chart of Bitcoin from Poloniex approaching New Years 2018

So, in the recent price runup that shocked me, but changed nothing concerning my opinion of the technology, I’ve been waiting for an opportunity to short it. With price, belief and technology doesn’t matter. What matters is whether there are any buyers. If there are no more buyers, the price comes down, simple as that.

In charts, you can look for signs that has happened and in this chart, I see one of the most beautiful head and shoulders patterns I’ve ever seen, complete with volume on the down legs and no volume on the up legs after reaching the peak.

Tomorrow, I’m shorting Bitcoin. Maybe it’ll put me in the poor house, but I have my own beliefs.

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