Every aborted crash is extra confidence in the $800 level.
I agree, but this is also confusing for me. It feels like we are "burning in" the $800 price... and yet it is so high above the exponential growth trend line.
*shrugs* I am just a buy & hold kind of guy, but my friends keep asking me if they should buy bitcoins, and I'm not sure what to tell them at these prices (... I always say yes, but I hesitate!)
The exponential trend line is a myth. Media awareness may grow at an exponential rate at first, but there is a "hype" effect that will cause it to eventually depart the exponential trajectory.
I believe we are seeing that now: all time Google Trends high, it is showing up regularly on network news, etc. It's not reasonable to assume that we can go from occasional web journalism to news networks without departing the trend.
Also, the amount invested by every individual joining the ecosystem will grow over time, since there's an intangible measure of "trustworthiness" Bitcoin gains by surviving each successive bubble.
Trend lines are fantastic predictors of the past, but their predictive power for the future is not so simple; you are drawing this trend, then assuming that the trend is created by some fundamental mechanism of growth. Unless you are correct in the assumption of some fundamental mechanism which will continue into the future, the trend will fail to accurately predict.
So really, without thinking about what the mechanisms of growth really are, it's just a blind guess.
An addendum: there ARE ways to model growth in dynamic systems (http://en.wikipedia.org/wiki/System_dynamics). By no means do I have the technical background for this - but it CAN be done. I wonder if someone is already profiting from a model.
Projecting an exponential curve in Excel on old data does not create new information.