Bitcoin is an experimental new digital currency that enables instant payments to anyone, anywhere in the world. Bitcoin uses peer-to-peer technology to operate with no central authority: managing transactions and issuing money are carried out collectively by the network. Bitcoin is also the name of the open source software which enables the use of this currency.
Bitcoins can be generated with a computational process called mining, and it’s behavior is like a commodity like gold or silver. There is a fixed, predetermined amount of bitcoins, 21 million of them is the maximum. That makes it inflation proof.
The initial pricing was $1 = 1,309.03 BTC on October 5, 2009. Right now it is about $1 = 0.070771408 BTC, that is 18496 % increase in value in only 4 years.
But what is interesting for me as a trader is that it can be traded in the same way as EURUSD. There are about 3 main exchanges with good liquidity to do trading with them, mtgox.com, btc-e.com and bitstamp.net.
There are a couple of sites where there are good enough charts like bitcoincharts.com and btccharts.com, there you can place basic technical indicators and oscillators.
The idea of this thread is to discuss the possible systems that could work with bitcoin trading. As i know there is no way to use leverage nor short positions, so one need to simulate short positions having half of the money always in USD and other half on BTC.
i once was a bitminer, but i stopped after prices rallied to 30 then dropped down to 5!
the thing is nothing backs up this "currency"
with cash, it’s backed up by your government…
what about this? who backs up this currency??? people on the net???
so basically it’s value was 0 then somehow someway it became worth something!
Do you think there is a real backup of a currency that can be printed when the government wants to do that?
Did you read about the “one billion usd coin” proposal?
Gold’s value is because it is hard to obtain it and then people assigns value to it. The same as silver, the same as money. If people don’t trust to the value of one security, it loses value.
Just like greek bonds. The investors lose faith on them, and so them lose value, up to junk bonds. Just remember the tulips. Some time ago, the were as valuable as gold, just because people assigned them value.
Just think about gold. What would happen to its price if suddenly one country finds a way to mine it as easy as getting sand from the beach? Do you think it could be considered a safe haven anymore, if it is so easy to obtain it?
The value of bitcoin is backed by its security, and the difficulty to obtain it is what makes it scarse resource just like commodities.
About the prices at 30 USD and then down to 5. That was a bubble, just like housing bubble. And we as traders benefit on that moves. The people that sold bitcoins at 30 and then rebought them at 5 made a very nice profit. Bad for the people that bought them and 30, they were the losers.
Also remember the coin that was used by aztecs. It was the cocoa beans. They had value because people assigned them value, isn’t it? Now, do you can buy a car with cocoa beans?
Just remember that the value of things is assigned by us, not that anything has value in itself.
How many “bitcoins” can you buy with $100?
How much can\does price move in a day?
what is the smallest tradable price tick in dollars? (for instance, on EURUSD, 1 pippette is $0.01 using $1000 lot size.)
The bitcoin currently trades at about 14 USD per bitcoin.
There area bout 10.5 million bitcoins out there, about 144,000 bitcoins are traded daily, that is about 2.05 million USD daily. The current market capitalization is about USD 153 million.
The daily ATR is about 0.3 bitcoins, so that is the daily move.
The smalles value is 0.00000001, that is 8 decimal points.
And there is no leverage so 1 bitcoin can handle only 1 bitcoin.
I think I just found how to trade bitcoins with metatrader using all the useful tools to help the analysis. I will place an EA that helps with that once I have it done
wow! the price rocketed to 16 USD per BTC! I taked profits when the price reached 15.81. I bought at 14.81 two days ago.
What did you look that shows accumulation?
I’m developing an EA that collects the data from my own database. I’m planning to place the EA here once it works well. Right now it fails sometimes and stops refreshing or crash the MT4.
Also I’m looking for a way to add support to trading functions inside MT4 to BTC-e and MTGox. That exchanges don’t support stop orders, only limit orders, so stop orders must be managed by MT4 or another external system.
Bitcoin is now at US$19.20, and it is still uptrending. I think it will reach the max point at 24 before a big correction. But the final price will consolidate on 24.
Interesting concept, since bitcoin is so new. Are you not concerned about the security of the exchanges though? Aside from the slightly more “ephemeral” nature (real or otherwise) of bitcoin compared to traditional currencies, the infrastructure behind it is still very new. There was a large hack on Bitfloor a while ago which resulted in a large amount stolen, and according to some papers, most bitcoins aren’t even in circulation - 78 percent of Bitcoin currency stashed under digital mattress, study finds | Ars Technica. I would imagine volumes and liquidity are quite low too?
Liquidity is enough for now. The btc economy is still small, so the current liquidity is ok. But if you think about how many bitcoin fractions are in the market then it could sum billions of small coins
Well, easy enough to make sure your own funds don’t get nicked, but I was more wondering if you’re worried about the impact that a big hack may have on price, since the bitcoin exchanges are more or less new. It’s not something you see on major exchanges or brokers
Been looking at this since few months ago, really interesting, it might one day become used widely, which is very exciting because there won’t be anymore PayPal fees etc.
Btw, why would there be a reversal? Since BTC is limited to 21 million BTC, price should steadily rise only right? Unless you meant retracing instead of reversing.
Let say, that is a “black swan”, and black swans are trade opportunities. Also, the hack itself is not what drives down the prices, but the amount of sell orders placed on the exchanges, that is what drive down the price.
But now, with the limitations for withdrawals on most of the exchanges, an attacker that wants to sell huge amount of bitcoins can’t withdraw that money fast enough.
I believe that once the bitcoin is more known, the market will be big enough to reduce the impact of one big seller/buyer.
And while that happens, I’m trading and accepting bitcoins for my services and products
using all the useful tools to help the analysis. I will place an EA that helps with that once I have it done 
