# Last edited on 2014-02-20 22:32:01 by stolfilocal

# Prediction check 

[b]Checking the Chinese Slumber Method predictions for feb/20[/b]

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

Prediction posted on: Tuesday 2014-02-18, 21:57 UTC 
Prediction valid for: Wednesday 2014-02-19, 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.
[url=http://www.ic.unicamp.br/~stolfi/temp/2014-02-20-prediction-check-HUBI-annotated.png][img width=600]http://www.ic.unicamp.br/~stolfi/temp/2014-02-20-prediction-check-HUBI-annotated.png[/img][/url]

The following chart shows the Bitstamp prices and prediction. The orange and grey dots are [b]Huobi[/b]'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.
[url=http://www.ic.unicamp.br/~stolfi/temp/2014-02-20-prediction-check-BSTP-annotated.png][img width=600]http://www.ic.unicamp.br/~stolfi/temp/2014-02-20-prediction-check-BSTP-annotated.png[/img][/url]

# Prediction make

[b]Chinese Slumber Method prediction for Feb/21[/b]

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 [i]two[/i] 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

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

[url=http://www.ic.unicamp.br/~stolfi/temp/2014-02-20-prediction-make-HUBI-annotated.png][img width=600]http://www.ic.unicamp.br/~stolfi/temp/2014-02-20-prediction-make-HUBI-annotated.png[/img][/url]

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