Market Discussions

Does anyone know why the price of robotics has dropped over 10k in the last week?

I'm assuming either one or more of the following, but it would be nice to know for sure:

1) a few big corps/players have dropped a glut onto the market.
2) with the increased player base there's more people doing PI.
3) alliances have started producing more for themselves thus killing the demand.
4) there's been a change in rules that I am blissfully unaware of.

Thanks

Thanks for the quick reply!

In my newness, I thought the boost to robotics prices was due to the recent pos changes.

Out of interest, what causes the yearly high price cycle? Increased activity over the summer then winter hols? Signup drives increasing player base?

When did VV come back?

Two components: supply and demand + greed and fear.

The former are at the foundation of the market, the latter drive the market and the speculation.

They yearly cycle: look at it like a volano effect.

In particular, you'll notice how in summer most double bottoms form (strong inversion signal) as the largest buyers restock for a whole year. Summer is the best time, because the player base is at a minimum so demand is minimum and prices heavily crash.
Then the big buyers purchase foundation items, from minerals to POS fuels, to T2 materials (this is a necessarily general description, each market has its own "temper").
In a perennial tug of war game between demand and supply, buyers and sellers, greed and fear, the markets will reach the yearly bottom first. Then there are 4 main possible outcomes:

1) Direct inversion or "V" shaped market or "inverse head and shoulders" that seen on a monthly graph will show a large pin bar (visibly taller than the bars preceeding it). This includes two-monthly pin bars (harder to spot).

2) Double bottom (rarely triple) or "W" shaped market, usually represented by a first pin bar, then a range market then a second price action pattern (PB / BUOB / DBLHC...). This happens when the buyers at the bottom were not strong enough so the market inertia won't let price immediately rise. Price will range and consolidate and gain the needed liquidity until one day the market literally stretches and coils down and then runs up (second bottom).

3) Very rare, price may form a round bottom in a formation called "cup", when it reaches the cup's "handle" it's time to buy.

4) Even rarer, once in a thousand times, price may form a bottom called "diamond" that will cause a massively strong inversion.


At this point, the market is buyers dominated and smaller ones add on the rising price. The lack of sellers makes price rise. Every so often, buyers liquidate their positions causing a peculiar market characteristic called swings (in RL markets with short selling, there will also be short sellers to factor in).

Swings don't happen everywhere. They are the "breath" of the markets. While each trader counts little by himself, the equilibrium between demand and supply is formed by the bunch of them. Unconsciously for the traders, markets reach intermediate demand / supply equilibrium levels where swings happen. These price levels are often met again and again even after 1-5-10-20-30 years later.
These price levels are also optimized in their "liquidity fill strategy" and "price discovery" motions, a bit like bees can min max the space fill rate of their nests and plants can min max the light exposure on their leaves. The fill criterium used by the markets is known as Fibonacci Numbers which affect a large number of entities in nature.
Some times swings come close to easy to recall numbers that are called "round numbers", like i.e. 80k ISK, 100k ISK and so on. In this case, traders tend to deviate the natural price discovery to match those numbers. I.e. if a swing would happen at 78k, it's very possible for traders to force it to 80k.

After a while we get to about October and the first large sales begin to happen. Smaller traders see it as a "dip" and buy. Often this gives another chance for markets to keep rising till December-January.
At this point we are at vacations time, expansion time, people stay more at home etc. so we have demand helping prices reach the top.
But then, after a while, people wake up and realize the peak has been reached, as hard as they push the prices just won't go up any more. Demand chills.
The large buyers now dump for huge profit, forming a pin bar.

Now a perfect mirror of the 4 market conditions listed above happens again (but this time, at the top).
If the dump was very large (the corresponding monthly bar high twice than the previous) the direct inversion scenario happens. A sell pin bar is an head and shoulder pattern, it's exactly like the point 1) described above, just upside down.

If the dump was more spread across time or enough traders thought it was just another dip, there will be a range market (point 2) with greed pushing prices up again till a second top, where a crash will happen. If the crash is mild, we can have a 3rd top or even a weeks long range market. But one day it'll happen, price will break the range market bottom and dive down.

The scenario 3) (cup pattern) is basically unexistant for when markets are at the top.
The scenario 4) (diamond) can happen, but it is still very rare.


Once price is on its way down, fear takes over, everyone run selling all they can till the summer expansion, where fresh demand will slow down the drop and some times stall it for a couple of months. But then it's free fall again till the year low. When everything starts again, in a next yearly cycle.

Edit:
Notice how markets are also fractal vs themselves so smaller and smaller "cycles within cycles" happen depending on the time scale you look at them. I.e. every week there is a little minimum at week end (after small traders dumped their weekly mined minerals / loot / etc.) then price rises till the next week end.
And every day, prices mini-crash when the 2 main time zones are about to log off and micro traders sell their daily mined minerals / loot / etc. and rise afterwards.

Edit2:
I call them "traders" but it covers everyone. Everyone is a trader and everything is a market, because markets are "give vs take" human relations and the tug of war is everywhere at every level and on everyone.

That is......until the new Liquid Ozone Bottleneck is realized.

Say WHAT exactly ?????????

sorry.....ignore. This Forum is spawning new messages instead of quoting (temporarily I HOPE.)

These things have absolutely NOT a thing to do with current Market.

Move along.............

When it is cold out, people tend to stay indoors and do indoor activities, like computer games. This increases activity in Eve.

Best analysis so far.

But again, when that Liquid O bottleneck hits..........................