Chinese Slumber Method prediction for Feb/21

Today Feb/20, Huobi's volume for 19:00 -- 19:59 UTC (3:00--3:59 AM China time) was 1186 BTC, which makes it a False Slumber day

Today also, prices were badly affected by the second Karpeles Catastrophe -- another disappointing press release bt MtGOX.

Given the last fact, it would be wiser not to make any prediction for tomorrow Feb/21.  Since we are not wise, we may risk it anyway, and in fact and offer two predictions.

One alternative hypothesis is that the large drop in prices we saw today is temporary, and tomorrow's Slumber Point, if True, will fall near the trend of of the last 10 days.  Such a recovery of the trend line after a False Slumber Point was observed after the episodes of Feb/11--12, Feb/13--14, and Feb/16--17.  The current trend can be modeled as the straight line P(i) = 4373.18 - 28.64*i, where i is the day's number in February. Setting i = 21 gives ~3772 CNY.

Another possibility is that today's drop is permanent --- like the drop by ~300 CNY on Feb/10, after the First Karpeles Catastrophe.  In that case, there seems to be no way of estimating the magnitude of the drop, and the subsequent slope.

The prediction for Bitstamp, as usual, can be obtained from that of Huobi using the currency factor R = 6.12 CNY/USD.

So, under the first hypothesis, we have

Prediction valid for: Thursday 2014-02-21, 19:00--19:59 UTC (not before, not after)
Huobi's predicted price:  3772 CNY.
Bitstamp's predicted price: 616 USD.



NOTE: To Man it was not given to know his Fate, and the Time of his Death; nor those of Bitcoin.

Checking the Chinese Slumber Method predictions for feb/20

The prediction for today Feb/20 (like that for Feb/10), was foiled by a Karpeles Catastrophe.

Prediction posted on: Tuesday 2014-02-18Wednesday 2014-02-19, 21:57 UTC
Prediction valid for: Wednesday 2014-02-19Thursday 2014-02-10, 19:00--19:59 UTC

Huobi's predicted price: 3800 CNY
Huobi's actual price (L+H)/2: 3530 CNY
Error: 270 CNY

Bitstamp's predicted price: 621 USD
Bitstamp's actual price (L+H)/2: 585 USD
Error: 36 USD

However, Huobis's volume at 19:00 -- 19:59 UTC was 1186 BTC, which technically makes it a False Slumber Point and therefore
outside the scope of the Method.  On the other hand, volume in the next hour (20:00 -- 20:59 UTC) was only 146 BTC, which
is well below the Slumber thredhold of 500 BTC.

The Huobi prediction is the rightmost blue rectangle on the chart below.  The orange and grey dots are the True and False Slumber Points, the mean prices at 19:00 UTC every day.  The orange line is the trend that was assumed for the prediction.


The following chart shows the Bitstamp prices and prediction. The orange and grey dots are Huobi's prices at 19:00 UTC every day, divided by R = 6.12.  The orange line is the trend used in the prediction, which is Huobi's trend divided by R.


EDIT: fixed the date of posting (19, not 18) and prediction vaild for (20, not 19).

Dear @windjc, could you please put me on "ignore"?  Thanks...

The document below is a recent advisory note by the Central Bank of Brazil about crypto-currencies. 

My Translation:
https://bitcointalk.org/index.php?topic=96118.msg5267554#msg5267554

Original:
http://www.bcb.gov.br/pt-br/Paginas/bc-esclarece-sobre-os-riscos-decorrentes-da-aquisicao-das-chamadas-moedas-virtuais-ou-moedas-criptografadas.aspx

Executive summary: crypto currencies should not be confused with electronic means for payments in BRL.  They have no emitting entity, backing institution or assets, no guarantees of acceptance or conversion to national currencies.  Their price may fluctuate wildly, even to zero, and governments may prevent their use.  They may get you involved in criminal investigations even if you use them in good faith.  They may be stolen by hackers.  We do not see them yet as a risk to the National Financial System, but we are following discussions in international forums and we may act if and when it is necessary.

The document below is a recent advisory note by the Central Bank of Brazil about crypto-currencies. 

http://www.bcb.gov.br/pt-br/Paginas/bc-esclarece-sobre-os-riscos-decorrentes-da-aquisicao-das-chamadas-moedas-virtuais-ou-moedas-criptografadas.aspx

Executive summary: crypto currencies should not be confused with electronic means for payments in BRL.  They have no emitting entity, backing institution or assets, no guarantees of acceptance or conversion to national currencies.  Their price may fluctuate wildly, even to zero, and governments may prevent their use.  They may get you involved in criminal investigations even if you use them in good faith.  They may be stolen by hackers.  We do not see them yet as a risk to the National Financial System, but we are following discussions in international forums and we may act if and when it is necessary.

---

[Approximate translation by Jorge Stolfi, provided for reader's convenience only.  The translation is not guaranteed to be accurate, especially with respect to the precise legal meaning of terms. This text should not be relied upon for legal purposes.]

BC informs about the risks associated with purchase of so-called "virtual currencies" or "cryptographic currencies"
February 19, 2014 17:01

The Central Bank of Brazil informs, first of all, that the so-called virtual currencies should not be confused with the "electronic currency" that are the subject of Law 12.865, of October 8, 2013, and their infra-legal regulations.  Electronic currencies, as disciplined by those norms, are assets stored in an electronic device or system that enable the end user to execute a payment trasaction valued in national currency [the Real, BRL --JS].  On the other hand, the so-called virtual currencies have their own form of denomination, that is, are expressed in accouting units that are distinct from the currencies emitted by sovereign governments, and cannot be considered electronic devices or systems for the storage of Reals.

​The use of so-called virtual currencies and the application, to them, of regulations that apply to the financial system and to payment systems, have been topics of international debate and statements by monetary authorities and other public authorities, with few conclusions to this moment.

The so-called virtual currencies are neither emittled nor guaranteed by any monetary authority.  Some are emitted and intermediated by non-financial entities, while others do not even have an entity that is responsible for their emission.  In both cases, the entities and persons who emit or act as intermediaries of those virtual assets are neither regulated nor supervised by monetary authorities of any country.

Those so-called virtual currencies have no guarantee of conversion to the official currency, and furthermore are not guaranteed by real assets of any kind. The conversion value of an asset known as virtual currency to currencies emitted by monetary authorities depends on the credibility and trust that the market agents may have in the acceptance of the so-called virtual currency as exchange instrument, and of the expectations of its appreciation.  There is, therefore, no governmental mechanism that would guarantee the official currency value of the instruments known as virtual currencies, leaving the risk of their acceptance wholly in the hands of users.

Because of their low transaction volume, of their low acceptance as exchange medium, and of the lack of clear perception about their legitimacy, the price variation of the so-called virtual currencies may be very large and fast, and may even lead to complete loss of their value.

On top of that, the eventual application, by monetary authorities of any country, of precautionary, coercive or punitive measures relative to the use of those assets, may significantly affect the price of said currencies, or even the possibility of their negotiation.

Furthermore, those virtual intruments may be used for illicit activities, which may lead to investigations by public authorities.  That way, the user of those virtual assets, even if he trades them in good faith, may find himself involved in said investigations.

Finally, the storage of the so-called virtual currencies in the so-called electronic wallets suffers from the risk that the owner of those assets suffers patriminial losses as a consequence of criminal attacks in the realm of the worldwide computer network.

In Brazil, even though the use of the so-called virtual currencies has yet to become a risk to the National Financial System, especially to retail payment transactions (article 6, paragraph 4 of Law 12.685/2013), the Central Bank of Brazil is following the evolution of the use of said instruments and the discussions in international forums on the topic -- especially about their nature, adequacy, and mechanism -- with the aim of eventually adopting measures within the scope of its legal mandate, if necessary.

Brasília, February 19, 2014
Central Bank of Brazil
Press Office
imprensa@bcb.gov.br

---

One would have thought that the markets were already prepared for the worst about MtGOX and would hardly react to yesterday's release.  Since MtGOX has been disconnected from the global market for several days, it is inacessible to arbitrage traders, and therefore its trade and price  should have  no direct influence on other exchanges.

But apparently that was not the case.  The lack (again) of any positive content in MtGOX's release must have led many investors to realize the foolishness of leaving one's money and/or BTC in the hands of exchange operators. 

So presumably many investors have decided to take part of their assets out of the exchanges.  Furthermore, many probably chose to take their assets out as cash rather than bitcoins, since the value of the latter is more likely to fall than to increase in the next week or so. 

Cash may be the preferred withdrawal form for Chinese investors, in particular, since most of them cannot use the bitcoins outside the exchange, and many may not be sophisticated enough to use (or trust) private wallets.

This flight from bitcoin should be the direct cause of the of the fall in prices at all markets other than MtGOX.

Interesting indeed.  I still have two theories that seem compatible with the statistics:  it may be an East Asian language encoded phonetically, or a codebook cypher using some roman-like number system.  But there are problems with both theories. Anyway, if the first one is correct, "decyphering" will require knowledge that I don't have.  If the second one is correct, decyphering may be next to impossible. 

Thanks for the tip!  I will check it out, seems promising.

(However, many others before him have obtained "partial" translations --- meaning a few words here and there --- assuming many different languages.  See for example this one:
http://www.ic.unicamp.br/~stolfi/voynich/04-05-20-manchu-theo/
So I will have to check it before I believe it...  )

Is there a profile option that will automatically detect stupid joke posts and add the "" at the bottom? Thanks...

EDIT: Ooops, I now got what you meant.   I should have copied TWICE the encrypted file to my pendrive before reformatting the disk and opening the two error messages.  Sorry.

If I had a hundred thousand BTC in safekeeping from thousands of clients, I would put them all into one wallet, double-encrypt the private keys, copy them to a pendrive, reformat the hard disk to get rid of any copies that may have been left by accident, then open the error message icon to read "io error while writing to /mnt/usb/MyPenDrive".

That makes no sense, if the police seizes MtGOX computers they will find out who HAD an account as easily as who HAS an account.

Volume today Wed Feb/19 was about one half of yesterday's in all exchanges, except Bitstamp where it increased by about 30%.

Volume in the Chinese exchanges was ~2/3 of the total.

I am not counting MtGOX in that total, since it still seems to be isolated from the rest.

Daily volumes of BTC trade to/from USD and other national currencies (in kBTC):


             !    Tue !    Wed !    Thu !    Fri !    Sat !    Sun !    Mon !    Tue !    Wed !
  EXCHANGE   !  02/11 !  02/12 !  02/13 !  02/14 !  02/15 !  02/16 !  02/17 !  02/18 !  02/19 ! Currencies considered

  Bitstamp   |  40.06 |  15.51 |  28.15 |  63.38 |  20.76 |  26.40 |  19.90 |  14.83 |  20.76 | USD
  BTC-e      |  28.64 |   9.97 |  18.53 |  52.18 |   9.16 |  21.75 |  15.07 |   8.08 |   5.84 | USD,EUR,RUR
  BitFinEx   |  39.54 |  12.85 |  17.17 |  53.68 |  10.83 |  16.75 |  15.69 |   8.47 |   4.71 | USD
  Bitcoin.DE |   0.67 |   0.51 |   0.78 |   1.63 |   0.22 |   0.57 |   0.57 |   0.38 |   0.54 | EUR
  Kraken     |   1.11 |   0.58 |   0.93 |   1.79 |   0.41 |   0.91 |   0.89 |   0.51 |   0.38 | EUR
  CaVirtEx   |   0.53 |   0.29 |   0.41 |   1.16 |   0.15 |   0.15 |   0.15 |   0.21 |   0.11 | CAD
  CampBX     |   0.11 |   0.10 |   0.21 |   0.41 |   0.05 |   0.07 |   0.28 |   0.10 |   0.14 | USD

  SUBTOTAL   | 110.66 |  39.81 |  66.18 | 174.23 |  41.58 |  66.60 |  52.55 |  32.58 |  32.48 |

  Huobi      | 120.08 | 131.86 |  82.39 | 236.27 | 122.80 | 110.57 | 130.41 |  74.04 |  34.12 | CNY
  OKCoin     |  64.22 |  60.79 |  62.49 | 147.26 |  51.45 |  63.63 |  63.05 |  51.46 |  26.29 | CNY
  BTC-China  |  11.17 |  11.01 |   8.02 |  24.87 |   7.55 |   9.08 |   7.86 |   3.86 |   2.04 | CNY
  Bter       |   0.76 |   0.69 |   0.65 |   1.54 |   0.74 |   0.56 |   0.48 |   0.35 |   0.37 | CNY

  SUBTOTAL   | 196.23 | 204.35 | 153.55 | 409.94 | 182.54 | 183.84 | 201.80 | 129.71 |  62.82 |

  MtGOX      |  18.70 |  25.21 |  33.85 |  79.56 |  60.15 | 104.46 |  65.69 |  63.50 |  40.75 | USD,EUR,GBP,AUD,JPY

  TOTAL      | 325.59 | 269.37 | 253.58 | 663.73 | 284.27 | 354.90 | 320.04 | 225.79 | 136.05 |



All numbers were collected by hand from the site http://bitcoinwisdom.com. Beware of possible errors.

For each exchange, the numbers include only the trade volume to/from the currencies listed in the rightmost column. Trade between BTC and other cryptocoins, such as LiteCoin, is NOT included.

Dates on the header line are UTC. Specifically, "01/15" means "from 01/15 00:00:00 UTC to 01/15 23:59:59 UTC". (Beware that Bitcoinwisdom uses your local time, so the date may appear to be off by 1 day.  For example, if you are 2 hours west of Greenwich, it may show "01/14 22:00" when the UTC time is "01/15 00:00".)

NOTE: A few days ago, MtGOX has suspended withdrawals of Bitcoins and national currencies.  Therefore it is essentially isolated from other markets, and its price is completely out of the norm.  The exceptional trade volumes above may be meaningless.

I did not say that. 

Thanks to all the "Voltaires" who asked me to continue posting even though they disagree with my views. 

I would like to reply to everybody who posted comments on my posts, positive or negative; but there have been too many of them, and besides it would be irritating for many of you, boring for many others.  Again, that is not why I am reading and posting to this forum.

Let me just emphasize that I distinguish "promoting the bitcoin project" from "convincing people to invest in bitcoin".

I am afraid that this note is too long already. Thanks for your attention. I sincerely wish you all the best.

Chinese Slumber Method prediction for Feb/20

Prediction valid for: Thursday 2014-02-20, 19:00--19:59 UTC (not before, not after)
Huobi's predicted price:  3800 CNY
Bitstamp's predicted price: 621 USD

For yesterday's prediction I had used a least-squares-fitted line over the last 4 True Slumber Points (mean prices at 19:00--19:59 where Huobi had nearly zero trade).  It turns out that the forecast would have been more accurate if I had put more trust in the method, and used all yellow dots since Feb/10 in the fit.

Thus,  tomorrows forecast for Huobi, above, was obtained by fitting a straight line to the last seven True Slumber Points (yellow dots) at  February 10, 12, 14, 15, 17, and 18, and 19,  and extrapolating that trend line for one more day.  The prices are ~4080,  ~4006, ~4004, ~3961, ~3905, ~3817, and ~3832, respectively; which extrapolate to ~3800 CNY.  



The prediction for Bitstamp, as usual, is that for Huobi divided by the normal currency factor R = 6.12.

NOTE 1: Those predictions are conditional to Huobi's clients and their robots being all in bed by Feb/20 19:00 UTC.  Otherwise the Method offers no prediction.

EDIT PS. the "confidence intervals" in previous forecasts were not based on any logic; I should have not posted them, sorry. I could compute a "nominal confidence interval" based on the deviation of the yellow dots from the fitted line, but that would not serve any purpose other than providing an excuse for errors.  Therefore, from now on I will post only the central value of the prediciton, without any "confidence inerval".  The prediction error will be mesured post-facto from that central value, as it has been so far.

Checking the Chinese Slumber Method predictions for feb/19

The prediction was not bad; but the simpler forecast "the price will not change" would have fared much better...

Prediction posted on: Tuesday 2014-02-18, 21:57 UTC
Prediction valid for: Wednesday 2014-02-19, 19:00--19:59 UTC

Checking the prediction for Huobi

Huobi's predicted price:  3725 -- 3825 CNY (3775 plus or minus 50)
Huobi's actual price (L -- H): 3820 -- 3845 CNY (3832 plus or minus  12)
Error center-to-center: 58 CNY

The prediction is the rightmost blue rectangle on the chart below.  The yellow and olive-brown dots are the mean prices at 19:00 UTC every day.  The yellow line is the trend that was assumed for the prediciton.


Checking the prediction for Bitstamp

Bitstamp's predicted price: 605 -- 625 USD (615 plus or minus 10)
Bitstamp's actual price (L -- H): 628 -- 636 USD (632 plus or minus 4)
Error center-to-center: 17 USD

The yellow and olive-brown dots are Huobi's prices at 19:00 UTC every day, divided by R = 6.12.

That quote is not mine, someone was replying to me.

I have not concealed my views, but what would be the point of insisting on them in this forum?  On twitter, my audience (only 2000, most of them "dead" probably) is only those people who choose to read my tweets; here it is not.  I am not here to troll, pick fights, or humiliate anyone.

Thanks!