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Bitcoin Cash: Fair Value or the Politics of Market Makers?

BITSTAMP:BCHBTC   Bitcoin Cash / Bitcoin
Bitcoin Cash is fun. I like Bitcoin Cash and Bitcoin . There is an Alpha dog battle going on right now.

On one hand:
Lightning Network, when???

On the other hand:
Scaling blocksize is just a BandAid, bro.

The woes of tech turmoil between Bitcoin and Bitcoin Cash are interesting. More interesting, the rise of Monero, IOTA and Cardano, in my humble view.

However, I am not here to place judgement on Bitcoin Cash in regard to the issue outline above. Much to the contrary, I think that this debate is healthy for the industry. My contention is this: How in the hell has Bitcoin Cash not absolutely dumped in terms of Bitcoin since this spike upwards following Coinbase/GDAX listing & why does Bitcoin Cash remain floating on its current Fib level? There seems to be baseline support at this particular price level -- for the moment -- and this is what I'd wish to discuss here.

A market maker is, "a company or individual that quotes buy and sell prices of an asset held in inventory; making their profit on a spread (difference in buy and sell price) or transaction fee."

According to this definition Coinbase and GDAX became THE market maker for Bitcoin Cash the moment that they opened up trading for Bitcoin Cash on GDAX, and supplied the market with Bitcoin Cash through funding wallets on Coinbase. I hypothisise that, all things being equal, a massive sell off of Bitcoin Cash should have occured the moment that liquidity was supplied to the market. This is the case - in every instance save few - when an ICO token is listed on an exchange. This INCLUDES Bitcoin Cash when it was first hard-forked from Bitcoin in August of 2017.

So what's the take away? This is where it gets interesting.

If Bitcoin Cash is being managed upwards, through the well timed and sheltered opening and closing of the market, then Bitcoin Cash's price will remain higher or constant through manicured markets. The net effect of this is to increase the price of Bitcoin Cash ; therefore increasing the profits of market makers for Bitcoin Cash , IE Coinbase! It's a win for the big boys!

Now, this the action we are seeing but -- and this is a BIG BUTT -- where is the majority of trading volume coming from??? One may be surprised to learn that 60% or more of daily trading volume occurs on the Chinese exchange of OKEX! Furthermore, this exchange has Bitcoin Cash valued at about $500 (17%) less per coin than other exchange platforms. Well, interesting to know. However, this is much more interesting since a company that seems to be out of Shanghai, China called Hangzhou Alibaba Advertising Co, is mining the majority (or running majority of nodes) of Bitcoin Cash . Could this be the liquidity provider (market maker) in China, namely on the OKEX exchange?

Interestingly enough, this may be the reason why there is liquidity and downwards pressure on the Chinese exchange, OKEX, while other exchanges are lagging in liquidity and have a higher price. In my opinion there is now only one question to ask: "You feeling lucky?"

Yes Bitcoin versus Bitcoin Cash is an exciting debate on technology and politics. However, I care more about my wallet. In this case it is my opinion that an increase of liquidity, or available Bitcoin Cash on the exchange, will push down the value of Bitcoin Cash in a market that has been propped up and manicured by market making.

One could say this is the oppocite of what the Bitcoin Futures are doing for Bitcoin right now, driving price down. Maybe I am blind, ignorant, or biased to the facts of the matter but it seems to me that Bitcoin Cash is headed for a crash, if not both Bitcoin and Bitcoin Cash .

We are in for a wild 2018. I love you all and for this reason I say HAPPY NEW YEAR!!!

Do not invest or take these words as coherent . I do not know anything nor should anyone think that this is valid insight of any kind. Ignore this information.
Bình luận: BCash has done well and just broke about the short term resistance trend on the Gann. I am now neutral on BCHBTC.
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Very interesting and unique take on things. You have a new follower.
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as i was bought it in high. when the rumor hot news say that the real btc is bch
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jbieb448 lisatina
@lisatina, my wallet do not respond to rumor. However, there is the old saying of, "buy the rumor sell the fact." The facts are in, since there has been a very large movement upwards and a retracement to the current Fib level. I would take profit here, or hold BCH as a means of hedging against BTC holdings. Although my gut says that this price level is not founded on free/open market forces. On the other hand, I would prefer that you did not act on my advice, whatsoever.
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Hi any suggestion as i keep holding it...my plan was just i wanna to sell 07 but seem bch is getting worst & worst day by day? pls? thq
Phản hồi
I was keeping an eye on on BCH:BTC as I was thinking a bullish breakout could occur, do you see any errors in my TA?

also any comments on the MACD and RSI indicators?
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jbieb448 Freedoms
@Freedoms, I like your chart, my friend. First, the MACD measures the strength of the current trend. I like your work, however, I will ask what the current trend is based on? I think this trend is based on a manicured market; initiated upwards (price increase) do to market makers (Coinbase and a central chinese mining operation) providing liquidity selectively to the market to increase price. The question becomes: Can this trend continue? and Is this price action - all things being equal - under free/open market forces? My analysis seems to indicate that this price level is unsustainable going forward. However, I might be reading into the "conspiracy" (ie market makers manipulation) as having more weight on price than it actually provides.

The RSI is also predicated on the current trend that, in my opinion, is founded on a conspiracy of market makers. For these reasons, this is not a price level that I would prefer in terms of Bitcoin.

Please, let me know of your rebuttal or agreement! Thanks.
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Freedoms jbieb448
@jbieb448, Well, I dont follow news/conspiracy much, I just try to do TA. The trend I was following was seeing the oversold RSI and bullish MACD plus the elliot wave count. It seems it has broken out. I think it will be pretty bullish long term.
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jbieb448 Freedoms
@Freedoms, glad to hear it. However, micro follows macro. Not the other way around. For instance, what happens to stocks if the Fed eases interest rates by 1% in January? Would this blow out the technical analysis of micro trends? I think so, although the RA you provided is not wrong whatsoever. I'm putting on my conspiracy hat, as is noted on the chart with dates of events correlating with volume changes to price.

This by no means disproves or provides any evidence contrary to the TA your provided. However, this bullish trend may be predicated on false or misleading price action due to market manipulation.

My analysis focuses more on macro, rather than micro. However, your micro analysis is very useful indeed! Thanks for your comments and hope you have a restful, fun New Years Weekend. Cheers.
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jbieb448 Freedoms
@Freedoms, First you were right. Then I was. Now what do you think about price action.
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Freedoms jbieb448
@jbieb448, I am still bullish on BCH, I have it breaking out the ABCDE correction
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