Manipulation
It seems the large volumes of Bitcoin ($BTC) move on to exchanges the previous days was not in anticipation to take profits entirely, but in the short term was sold to force more liquidations to bring Bitcoin down to the $53,500 mark. Bitcoin, however, found support in the bull market support band at this level, and when seeing 9% corrections, its good to remember a few things:
- This is normal price movement in crypto, so don't be shaken out or ape into leveraged positions
- The longer the market trades sideways, the more 'moon juice' there will be on a breakout
- Today's price action forms a wedge which lengthens the anticipated time it will take to breakout to the upside, but also increases how much upside we may see.
What is the Bull Market Support Band?
You can draw this indicator yourself by selecting the 20-week Simple Moving Average and the 21-week Exponential Moving Average. The integrity of the bull market is compromised whenever the price breaks below the Bull Market Support Band, at least in the short term typically between 2 to 6 months.
We could be looking at a further 2-3 weeks of sideways movement before breaking out or down from this wedge.
More Liquidations
The crypto market is highly leveraged, often by new and inexperienced traders and this creates an opportunity for whales to move the market and liquidate these positions, driving the price down in the short term and accumulating at a lower price.
In the last 24 hours, nearly $800m worth of Long positions were liquidated in the crypto markets, with $227m of those liquidations coming from Bitcoin and a further $205m from Ethereum ($ETH).
What now?
Bitcoin will continue to retest the Bull Market Support band and simply it will either hold or won't. I am personally bullish and will not be shaken out of my positions. I continue to despise the use of leverage/margin trading, because of the manipulation present in the market. I would encourage you; if you are new to crypto to apply the same caution when considering the use of leverage, do not let the whales get your crypto. Dollar-Cost Average IN and OUT of your positions. If you miss your opportunity to take profit, you can always have the option to be patient and HODL until you want to take profits.
I believe we are in for a parabolic, blow-off-top to the end of the bull market, which we have not seen yet! This will be when I take profits and I will re-accumulate BTC the year leading up to the next halving when it's 'on sale'.
HODL on and thank you for reading!
None of the above is financial advice.
