What happened in crypto in the last couple of days? What triggered that sharp prices plummet with more than $1 billion in liquidations?
Well, there’re some speculations about such triggers and some chronicles published – with Evergrande bankruptcy, supposed SpaceX’s massive BTC sell, and SEC set to greenlight ETH futures ETF and cascade liquidations. Still, none of them actually look and feel credible enough.
Rather, the actual catalyst lies in the context of a general decline in financial assets amid rising interest rates and Evergrande bankruptcy (with an overall slowing of the Chinese economy), while The Wall Street Journal article with the rumors about Elon Musk’s SpaceX selling its bitcoins and writing off $373 million in crypto investments over the past two years was just a trigger.
Anyway, it looks like we have the biggest liquidation event since the FTX blowup without a proportional and credible crypto-related catalyst this time.
This makes technical analysis look favorable in this context, even though it “doesn’t work,” as everyone can tell you.
For bulls on BTC, ETH, and other crypto, it’s definitely better to see a V-shaped bottom; otherwise, one could expect the market to fill those futures wicks, at least.
And one definitely doesn’t want to see a lower low here, which would technically signal the end of the bullish trend:
But if we zoom out, the macro picture still looks just like a healthy enough pre-halving period.
According to Delphi Digital’s analysis, bitcoin price action is beginning to mirror BTC’s 2015-2017 pre-bull market cycle (thread).
So don’t let shorter-term market moves and emotions dwarf your macro vision, which is credible today as it was a half-year ago (and earlier). This play just needs time to develop.
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