I've lived through and analyzed multiple financial collapses. Rest assured that the "massive" selloff in the STEEM cryptocurrency is not one of them. Yes, I know it looks bad, but hear me out -- using basic scientific methodologies, we can assure ourselves that this is nothing more than a correction.
In market theory, a correction is the unwinding of extraordinary bullish activity. All publicly-traded assets go through this phase, and it actually reflects a healthy market. For example, this is the reason why we have a digestive system. As great as that filet mignon tasted, you definitely don't want it in your system forever.
A correction, therefore, is similar to defecation. In sharp contrast, a collapse is like diarrhea. You stuffed yourself silly with a mixture of sugars, salts, and fats, then caked it all in alcohol. Your tummy protests by explosively excreting all that junk from your system.
You do not have diarrhea!
Just a Correction, Nothing More!
Indeed, it would be strange, then worrisome, if you did not defecate at all after enjoying a hearty meal. Just as you would not be alarmed by taking a long whizz after drinking a gallon of Gatorade, you should likewise avoid panicking on the STEEM cryptocurrency.
Let's transition away from the biological examples and explore the scientific basis as promised. For this analysis, I will be looking at the STEEM price in USD, but converted to its base-10 logarithm. This enables an "apples-to-apples" price magnitude comparison.
When the Steemit platform was initially launched, the STEEM cryptocurrency took off like a bat out of hell. Using standard physics, we can calculate that the STEEM logarithmic velocity was 0.59 points per week. However, in the second major rally, STEEM had a much slower velocity of only 0.12 points per week.
That's a difference of 392%! No wonder why STEEM collapsed during its initial run-through. Steemit was simply too much, too soon.
Major Buying Opportunity
During a collapse, it's rare for an analyst to recommend buying the bleeding asset. No one really knows the depth of such volatility. But a correction is a normal dynamic within the market cycle -- these are dips you should buy, if you are confident enough.
From the evidence at hand, STEEM is going through a corrective period as a means to consolidate prior massive gains. In the three weeks since STEEM hit its first parabolic peak in 2016, the cryptocurrency felled 70% in three weeks. In the current phase, STEEM has only dropped by 32% in three weeks. Yes, it's a hefty loss, but it's a ton-better than -70%!
In other words, STEEM this year has taken its time to rally to nearly $3. And it's comparatively patient in the downside as well. Over the last several hours, I have seen the price gain back 20%.
Just stay patient, and this correction will go away sooner rather than later.
I was going to convert steem dollar to steem yesterday, it was 1.4, decided to wait, now it's 1.2
Yeah, I just didn't buy at all when it hit crazy prices like 1.5 and up. Saw it go down to near parity and I picked up a few! :)
I love that you put effort into your articles! Many others just try write up something quick and dirty in hopes that they'll get a quick few bucks. Good analogy too!
Thanks, I appreciate that! I actually do write quick and dirty...it's just that my standard for it is a lot higher than many so-called analysts! :)
Lol. And you have tons of practice!
Are you talking about the analysis, or the diarrhea? LOL! Ignore me, I'm just being silly :)
Sometimes I my poops are solid after a good night of drinking, not sure why. But yes, yes, yes, to all you say. I see these dips as great opportunities to pick up coins at a cheaper price and due to the lovely Steemit I am able to generate revenue to purchase these coins instead of using my job to supplement my crypto purchases. I am however worried about how the current global financial situation will effect crypto in the event of its soon to come fall. Zerohedge put up a nice article on that today if you interested. Good stuff today my friend! Great post
Hahaha! I like to throw a little curveball every now and then! Thank you, I' ll have to check out that ZH article. And yes, I feel ya on the whole global financial situation... I don't know about you , but the real estate market in SoCal is utterly f-ing insane! Honestly, I don't know how people are affording half-mil just to live in a studio condo. I think we're headed towards Housing Collapse 2.0
Exactly, every time I hear someone I know is trying to buy a house, I just tell them to hold on another year or two. It will be worth the rent!
Yup...you can always recover from buying a stock at a bad price, but the average American family cannot recover from buying a house at the top of the market!
Clif Hugh has discussed the eb and flow of the money in and money out of the crypto's over the summer... the over all trend is going to be UP!!!
Yup that's true! Have you checked out the volume in the major indices? Talk about money outflow and lack of participation! All those trillions need a home, and I sincerely believe it will be to the cryptocurrencies! :)
Yep... just waiting for the big move into the PM's BTW resteemed and upvoted.. please check out my latest post on the unboxing of my crypto conversion..
https://steemit.com/bitcoin/@erinscottsolar/unboxing-my-bitcoin-eh-hem-my-silver-converting-the-crypto-s-to-real-metal
You got it! :)
Hahaha! Your analogies are brilliantly humorous. Your point comes across very clearly when employ levity along with statistics and hard facts.
Love your post!
"with a mixture of sugars, salts, and fats" - that is funny one :))
Hehe...I decided to get a little creative! :)
I see that. Lol :))
thank you!
Sure thing! :)
SBD is up
https://coinmarketcap.com/currencies/steem-dollars/
Damn! Oh well, I converted some when it hit parity! :)
polo is driving that, people can't move sbd or steem in or out so trading is hot.
It's a stand alone market, or I would buy at Bittrex and sell on polo all day long :-)
Excellent post! pretty much everything was in the red regardless so not worried about Steem. I'm definitely invested in STEEM for the long term. Just look at the drop in price as being healthy for the long term growth of Steemit and a great buying opportunity.
Thanks! You a gun guy? :)
Most Definitely. Precious metals. I invest in brass also. 1776 for life.
Awesome! I just followed you. I'm hoping to do some gun videos/reviews in the near future :)
And I think that was my 1,000th post...haha! Love it! :)
Awesome brother. I'll look forward to that! I plan on doing some range videos and reviews soon but I wanted to feel out the steemit community first lol. Didn't want to scare anyone. I have a youtube channel that I basically do whatever I want on so sub me if you go on youtube.
Actually, gun videos are among my most popular videos on Steemit. And frankly, I don't give a crap whether people like it or not. Not to sound like an ass, but I don't feel any need to justify self-defense, or simply the exercise of my Constitutional rights...I'm sure you feel the same way!
Really?! I didn't know that. I need to expand my audience and start following more like minded people apparently. I've admittedly been focused on cryptos lately and took a break from firearms but I think you motivated me to put up some videos today :) I definitely feel the same brother. What are a couple of your top favorite firearms? For me I love my AK and AR pistols in 223/556 300blackout and 762x39. Also Glocks and Sigs. Always good to have a variety for different applications of course.
Great advice! Also, EOS crowdsale will bring a lot of attention to Steem soon, once will get past the "panic" stage in the markets.
Definitely, that's a very good point! :)
I always laugh when I see people panic. I just pour a glass of scotch and enjoy.
I just wish I had more cash to invest during these corrections.
Yup, I hear ya...plus, the correction might be over in a week or two; then it's back to silly season! :)
What is killing me is I'm getting a pay check tomorrow and I missed out on the lowest point in the correction. I just hope there's another one soonish haha
FWIW, I think there will be some choppiness over the next few days...I could have gone all in, but I'm staggering my purchases in case the next correction takes us even lower.
Yeah that did occur to me, with all the other cryptos taking a dip it could prompt people to sell steem and cause it to dip further. I can only hope :)
Great Article. Very in-depth. I can learn a lot from this when I do my daily reports for the community.
https://steemit.com/cryptocurrency/@jrose1010/video-crypto-market-update-evening-report-6-26-17
Thank you! I'm very glad I could help! :)
Your right, it a great buy opportunity. Win Win
Thanks for your analysis
Cheers
I truly believe so, and FWIW, I put my money where my mouth is! :)
Great post,so is it worth investing 'steem dollars' in addition to 'steem' itself?
For me, I only invest in STEEM since its value is derived from simple supply-demand dynamics. As far as steem dollars, it seems that their value is derived from a combination of market value and STEEM value. I just don't like to get involved in overly complicated valuation structures.
Keep in mind I earn steem dollars, but of course, that's different than a capital investment towards steem dollars.
Hell I even enjoy looking at your other responses!
This is what this account is all about -- educate and entertain, maybe have a laugh while you're at it!
Right from the start of my crypto trading I have noticed the price movements of steem. It has a consistent up-down swing, perfect coin for day traders and it recovers pretty fast too in comparison to other coins. It's behavior maybe means that it has a lot of users, I would see that steemit is a contributing factor largely.