For more than three days now, Bitcoin (BTC) and other cryptocurrencies have been experiencing a drastic drop, falling below $43,000 per unit. Beyond several unexpected situations such as Elon Musk's statements or the poor understanding of BTC consumption, we are experiencing the entry of a fear zone that has been systematic in other opportunities in the crypto cycle.
While, the crypto index of fear and greed reached levels forgotten since 2017 and 2020 that many have a hard time recognizing because of the unpleasantness of these experiences. As a market we really enjoy the increases and comparisons we make on the dominant crypto, but we must also learn to face that, like consumption, we have the adjective volatility etched into the definition.
At the moment, the BTC has a value of $44,000, with a strong resistance at $45,000. But, beyond the causes, we can add that the continuity of the fall is mostly due to all those retail sales that do not understand the movements that experience a price correction. Even if the causes were unexpected, the healthy correction was necessary for a weighted growth that highlights BTC as a new store of value, rather than an exchange currency.
One of the things we must understand is that as users we must mature and synthesize our emotions into a solid understanding of our analysis. The fundamentals of the crypto market, especially BTC, are well supported by a plurality of investors, including institutional investors. Beyond the fact that we are witnessing a commentary that is not at all elaborate and improvised, on purpose or not, we should focus on having a deeper analysis of the players who are in this game. Even Musk made the point that Tesla has no intention of selling its BTC. And if it did, it wouldn't matter much either.
We are in an interesting market stage, we live under a system that is sinking deeper and deeper into an internal poverty, unable to foster a solution while still affecting a part of the wealth of the state. This other agenda is simply not elaborating new solutions but is in charge of maintaining the no escape policy, and this is the main motivational index to be built on BTC.
Selling BTC right now is the worst decision they are making; BTC is a hard asset saving solution. Policies closer to the FED will only focus on keeping rates close to 0 and manipulation in markets like gold or silver are evident so as not to lose the confidence that revolves around the dollar. Why do they think it would be different with BTC.
I'm going to take the liberty of quoting a statement by Mike Novogratz, the founder of Galaxy Digital, to cointelegraph in early January of this year where he said that he "is confident that Bitcoin will recover again but humans are not built to live in 150% volatility environments. That was the signal. When volume pulls back, we will bottom and resume the rally." The quote alone reflects what we should do, not give in to fear and take advantage of those opportunities we are looking for in the market.
As always I leave at the end of this paragraph the links to some articles that record the same behaviors we are seeing in the market. The similarities and differences and how the BTC line has experienced excellent recoveries.