China bans bitcoin. No they didn’t. Yes, they did. No, they didn’t.

I was getting worried here.

Everytime there is a rumor that the Chinese government bans bitcoin, bitcoin prices drop.  Then a few days later, when it becomes obvious that they haven’t, the price goes up again.

The thing that I was worried about was that over time, people would figure out that this was the game so the rumors would stop, the price of bitcoin would stabilize, and I’d stop making money from this trade.  But it seems that this isn’t going to happen soon, so I’m looking forward to another few months of profiting from these trades, before it is either obvious that the Chinese government is not going to ban bitcoin or if in fact they finally do actually ban it.

One thing that I do think is happening is that these rumor swings are becoming less severe each time people “cry wolf” and if I had my analysis software running, I could figure out how long it would be before people stop caring.  Guess I have to get my software running.

Now, I’m a bit too ethical to actually *start* these sorts of rumors, but there are plenty of people that are willing to do that.