Market Discussions

OK 1 last post then I'll shut up :)

Lets just compare megacyte and zydrine. They both jumped for the same reasons, not similar pretty much exactly the same.
The consumption is being doubled for both.
So the long term price effect for both due to the same change should be the same for both yes?
OK very simplistic analysis.
Stretch those price graphs out to a year for both minerals.
The period from a year ago to just before the tulip bubble.

Megacyte cruised down from 1600 to 700 = 43% of original price.
Zydrine cruised down similarly from from 750 to 400 = 53% of original price.
10% difference in price fall

My point being so far that they pretty much mirror each other. Not exactly, there's a 10% difference but they seem to be tracking each other pretty well.

Now do the same exercise on the bubble.

Meg 700 -> 2000 = 285%
Zydrine 400 -> 1300 = 325%
40% difference in price rise?

My point is that for two items subjected to the same stresses, and with a history of matching, are now significantly imbalanced.
Either megacyte is under priced or zydrine overshot by too much. Or maybe a little of both. The market will correct this over time. I strongly believe zydrine overshot and will fall a few hundred before it starts to settle.

I think I need to make my point clearer maybe.

None of us know, apart from CCP, possibly not even CCP what will happen to the prices, but we can guess and even use logic.

The two items are both subject to the same changes.
But they have reacted with sufficient difference to warrant a question in my opinion.
The question being has zydrine overshot too much? Is it likely to go down?

I compared the rises in both to back up my argument.
I am not assuming one is right, I even go so far as to point out they could both correct in the part you quoted of my post.
The fact they are both going down, Zydrine more so, even since my posts hints strongly that the short term correction lies in that direction not the other.

No one doubts consumption has doubled.
Supply will probably go down ( as long as the price increase doesn't motivate miners to mine more of it ) the market will decide and self govern.

These changes mean the price must logically go up from where it was, but it already went up significantly from speculation alone.
The real question is "Will it go up or down from where it is NOW?"
NOT "Will it go up from where it was?" That has already been answered, there are no cookies being given out for figuring this out even if you worked it out without looking at the market.

Where the price is now versus where the price will be in the short, medium and long term is the question where ISK is to be made.
I was trying to answer that question, with reasoning, and stuffs.

Edit - Sorry for the GRR tone in my post.

We will be fortunate if zydrine stays in the 700-800 range long term. Higher prices will just encourage more mining not to mention the stockpiles that exist from the glut of supply for so long. I think 1300-1500 for megacyte sounds and feels about right unless null decides to mine the snot out of high ends.

Ok...let me tell you something about supply and demand. You change say, supply, and demand does not have to change in such a way to ensure the price does not have to change or changes very little. In fact, that hypothesis, essentially, rests on a "knife's edge". Supply changes by X at all prices...and then demand changes by Y at all prices so that the equilibrium price is unchanged. In probability theory this kind of an outcome is one that is known as being almost surely zero--i.e. the probability is zero, although it could still happen.

In my estimate above, I picked the average between the historic price and the current price to account for additional mining. Thing is that even with additional mining it isn't clear at all that it would have to keep the price at the current level or even lower. Essentially mining would have to double and I'm not sure that is possible given the changes.

Lol, my point exactly. The high end market has been out whack for so long theres just so much out there. I think ccp did these changes just so those two minerals didn't go to effective zero. And the poster above who said he didn't think mining could double, the way prices were going they were already mining over what was needed because those prices just continued to fall. One guy in this thread predicts 3700 megacyte??!! Sorry folks that's a pipe dream.

Every once in a while I will stroll by to see if the zoo has churned out a smart ape.

Nope.

No, I suppose considering both changes really it would need to quadruple to keep price about the same. Yes, there was enough high ends being produced in null to send the price down quite a bit. The point of the patch is to correct for that. So if null miners do not change their behavior the amount of zyd/mega would drop by half. With the change to BPOs/BPCs that is like cutting the amount of zyd/mega in the asteroids in half again.

Now, null miners could respond by mining much, much more. But I doubt it will be enough to offset the patch. You have staked your position on one that is at the extreme edge. That's fine, I just find that outcome being rather unlikely.

Welp, that escalated quickly.

http://imgur.com/a/uHb7l#0

Professionals at work - 58 mil unit Megacyte Sell order. ☺

Megacyte: http://i.imgur.com/blGPzZt.png

Likewise for Zydrine. Complex corrections are... complex.

Unfortunate.

That cannot continue indefinitely though. The supply of megacyte or zydrine in people's hangars is ultimately finite and as a result while portions those supplies can be dumped at various intervals it wont keep the price from moving to its final equilibrium/steady state price.

Periodic profit taking is not going to slow things down forever either.

Depends on what you are in for, some short term gains? Good luck, you'll likely make some isk if you are careful and have a bit of luck.

Holding longer term so that current inventories are eventually whittled away and prices return (for mega) so somwhere in the 3,000+ range ...might take some time, but we'll get there.

Consider this, in 2014 the average amount of megacyte on the market was around 27-28 million/day and the average price was 1,222 and in the last half of the year the average amount on the market was just under 28.7 million with with an average price of 984.

Back in 2009 (unfortunately my source only covers November and December) the quantity was around 16.4 million with an average price of 3,258. If we limit ourselves to those days where the quantity was below 13,500,000 we see an average price of 3,565.

Consider that the amount of megacyte and zydrine have been cut in half in anomalies and that the BPO requirements have been doubled...a price of 3,200 for megacyte is probably a tad conservative. Yes, there might be more mining, but I don't think there will be that much more mining.