If you listen to stupid shills like Elliotrades, you miss out on the greatest gains in crypto. These permabull idiots make their money not from trading, but from shilling everything all the time. They grab news items to make their points seem valid, which is the least scientific, most stupid way of predicting price action possible.

If you've ever wanted to know why stocks drop after beating earnings, if you've ever wanted to know why your leverage always gets liquidated, if you've ever wanted to know why good news doesn't guarantee good times, read on.

The News

We've just received word that MassMutual is putting $100 million into bitcoin and Microstrategy is upping its new bet by $100 million to something like $500 million. At the same time, the European Central Bank is expanding quantitative easing to $2 TRILLION. With more institutions pledging publicly to buy bitcoin and central banks debasing the currency, bitcoin should be parabolic right now.

But it's not. It's fighting to hold $18,000 and threatens to fall as low as $13,000.

Why the hell would anybody be selling their bitcoin at this point? Hmmm.

The Games

Before we get to the "legitimate" price movement, we've got to address the gamesmanship that's occurring. Define legitimate movement any way you like, but I'll define it here as people who buy without the intention of trying to outsmart the market. The scammers here include the

• institutions lying telling you the opposite of what they're actually doing;
• wannabe whales who buy bots and try to be bigshots; and 
• dumbass noobs who think they are smart enough to trade 100X leverage and not blow an account in two minutes.

First of all, it's very important to realize that these institutions proclaiming their interest in bitcoin are probably driving the price down right now. As they announce their interest, they dump the coins they already have on the market, fooling retail buyers into moving the price down. They may also be timing their release to the Mt. Gox repayment, which is sure to cause more selling mid-December pressure. These institutions (and exchanges) also benefit from liquidating longs with downward pressure. Short squeezes create downward pressure as well.

Then you've got individuals with enough money to move markets with their incessant trading. They obviously don't have the money of institutions, but the money velocity you can create with bots can multiply the effect of that money exponentially. Bots help solidify a trend, especially when they are wrong. Flash crashes are often caused by bots automatically selling when a price dumps, causing a cascading effect that causes the bots below to sell until everybody is wiped out.

And lastly, we've got the dumbass noobs. These are the panic sellers who will create selling pressure as soon as they see red. Individually, these traders are insignificant. But together, these idiots comprise the majority of market sellers. Stupid is one of the most powerful forces in the market to reckon with. Especially with idiots like Elliotrades and Bitboy magnifying the stupid.

The Reality

So you've got Microstrategies, et al. lying and dumping on buyers to lower the price only to buy back later, and this selling pressure is forcing bots to sell, which is causing panic selling in the idiots. (In the meantime, altcoins are going up one by one because of the shills and Coingecko hacking. Don't let that fool you.)

Here's the truth.

Price in any asset responds to itself, that is, the buyers and sellers in its market. If the active buyers don't want to buy any more at that time, the price goes down. If the active sellers don't want to sell any more, the price goes up. It's that simple.

This is why you'll often see a huge dip in a price right after a great earnings report. Check the days before the report. The stock likely had a runup. "Buy the rumor, sell the news" really doesn't capture the truth here. It's just that the buyers decided to buy before the report came out, then there were no more buyers. The great earnings report didn't bring in any new buyers, so the sellers win.

Once I let this reality sink into my heart, I stopped getting pushed around by news reports and silly shills.

Right now bitcoin needs new buyers. When you hear a company announce, they're already buying, so MassMutual isn't a new buyer. Microstrategies might even be selling at this point. In the meantime you have 97-98% of people in profit on bitcoin. With Christmas coming and no stimulus extension on the horizon, they are going to sell.

Hold over the weekend only if you are prepared for a multi-week holding pattern. We are going to see downward movement for sure, and possibly a lot of downward movement. I think that bitcoin is going to take the scenic route to $20k. January will bring new regulations. Although government is ultimately toothless vs. bitcoin, just the announcement will cause stupids to capitulate. This annoys me just as much as it does you, but it's best to be prepared so you can party in early spring 2021.