300 BTC open market purchase of STEEM, spikes price to .00324

in steemit •  3 years ago 

A few days ago I made a post saying the week long decline was ended and we would likely go into a trading range with a ceiling of .004 that would be hard to get past.

After the initial gains, when the price fell almost back to the recent lows, it looked like a silly prediction. Then just a couple hours ago, someone bought 300 BTC on poloniex, instantly spiking the price 40%. This looks to be an impatient buyer who bought his entire amount in one shot as following that the price is back down to .0027.

What does this mean?

When anything is in a prolonged downtrend, it creates a lot of resistance to going up, simply by people who set orders to get out at breakeven, or small loss, or simply want to move onto trading something else. What that does is make things really difficult for the price to go up any significant amount. The only way is if a big buy comes in and clear the orderbook before the market can adjust and adjust the prices.

300BTC, thats over $150,000 USD and it is not any casual amount. The fact it was so impatient (in at best a sideways market) indicates there is some time sensitive event coming up. Or this BTC whale has so many BTC that 300 is like $300

Now we have two things that both indicate the downtrend is coming to an end, if it hasnt already. I know a 50% gain from here seems like a long ways to go, but really it just takes one whale to buy 200 BTC in one shot. Another way to look at it is that with 400+ BTC of volumes per day, it is one day of buys exceeding sells 2:1.

Remember trading short term is very risky and everything I write about is without any certainity, just my observations. Also, it usually takes three times to really confirm things, though that 300 BTC buy could well count as 2 events and sure makes the chart change from a pure downtrend.

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I don't see the price going anywhere until the next cycle. Most whales cashed out massive amounts.

I am trying to detect this "next cycle" that you speak of,it is not here yet but like spring comes after winter, and summer after spring, prices goes in cycles. We went through a winter and it feels a bit like spring now. Still a bit chilly, but I see some blue sky over there -->

I saw that earlier this morning on Poloniex, but had sold my STEEM previously. Couldn't get in on that one. I wonder too, what might be coming?

I think rise in the price, I observed for these phenomena too

I wondered what the big spike was today. Is someone betting on the STEEM Price or are they going to seriously Power Up?

Could be a corporate buyer. An advertising firm should find this soon. Imagine a powered up marketing firm that voted on all crest posts or all ford post.

it is unlikely a corporate advertising firm will lock up funds for 2 years to advertise on a platform that came out a couple months ago. especially since the revenue per self-click is about 5 cents for $10,000, that is 200,000 clicks needed to recoup. (these are just ballpark estimates) and at 100 votes per day, it is 2000 days or 5 years...

Good point. But I think we'll see it . Just need an ad exec to get fired and try to start anew firm here. Prob corporates that feel threatened would be most likely buyers. Reddit?

maybe there's a way to identify this serious Powering Up? Was it a newcomer or an oldboy :-)

It appears whale is a trader more than an investor. He must know something we don't know. Haha

Every content of yours is a gem!

Thank you for being such a great contributor to this community.

The interest earned on steem power alone could make all early adopters filthy rich 3 or 4 years down the line.

yes, but we are all stuck in the same boat, so despite our differences we need to work out all the conflicts. With all the whales and dolphins locked in for 2 years, there is enough time to fix all the things that are not quite right, so the only question is if the community will set aside their differences for the greater good.

A most interesting experiment indeed.

well said James, well said!

Thanks for sharing.... very interesting.

I think some people are getting impatient with Bitcoin and have decided that they have a greater chance of making money if they put their holdings elsewhere. There has has also been a large exit from both versions of ether. I see this partly as a knock-on effect from the ETH/ETC crisis.

Not only did it shake confidence in cryptos generally due to the DAO hack but the ether wars have highlighted worries over a BTC blocksize change even more than before.

If the ether situation is hotly contested then the BTC blocksize debate could result in an even more difficult situation.

I think this making people feel very uneasy about holding Bitcoin and the potential for a full blown civil war over it's future.

People are looking for other cryptos that will give them some semblance of stability if not outright price rises. Steem is one of the first utility cryptos and is likely to get more investment as a result. People probably see it as a better bet due to that.

Thanks a lot for pointing that big buy out. It could be that the whale in question is himself a short-term trader, as the volume and price spiked after his big buy. Maybe he was pushing the market to snap up a quick gain; if he did, and sold, he likely got one.

That said, STEEM is higher than it was now that it's calmed down. He might have reversed the downtrend after all. Interestingly, Synero AMPs are up even more than STEEM on a percentage basis.

simply by clearing out all the available inventory 35% higher in price, it makes it that much easier for the price to get back there. It was definitely an usual event, usually coming before some big event that changes the market valuation of things. Cant say I know what that event is or if there is an event, and as you say, maybe it was just a whale trader counting on the market to fill in the blanks and push the price up.

Maybe it is one of the steem whales who was sad that their portfolio balance shrunk by so many millions.

Yes, that's possible too. Or that whale's motive could be simple bullishness.

but why the insane rush, we are talking an instant loss of $25,000 or so as he could have easily picked up the same amount for 50 btc less. maybe it was a fat finger on the volume, but that doesnt explain the price being so high. I think we need that whale to come here and explain himself!

Like that'll even happen ;)

It could be a hybrid of my first reason and plain old bullishness: buy with a fat finger, sell some after it shot up and hold onto the rest. If so, then that whale was either unusually shrewd or lucky. Manipulation is much harder than it looks.

Hey James:

Look at this post. I think it explains why the whale got bullish.

https://steemit.com/steem-power/@me-tarzan/steem-daily-data-8-16-2016

There's been some worry about more STEEM not being used to power up. @smooth explained why in a comment that @me-tarzan included in the above post:

" The main reason for the increase in STEEM not powered up was a huge power down (687K STEEM) by the steemit account (see activity history below).
These are coins which Steemit (the company) has indicated are to be used to fund new accounts (currently 3 STEEM per account is being given away by Steemit) and sold to fund development. "

That comment might have gotten the whale - and others - motivated to make the big buy(s).