06/09/2018/07:40CET
BTC is trading at 6427 usd at press time after a sickening fall that started about 18 hours ago.
We were steadily trading at 7000 - 7300 range with market structure being build when all I can imagine, a huge whale came into the markets and dumped! Big time!!
This daily chart shows the carnage!
We have clearly been rejected out of our ascending channel pattern.
In fact, while I was theorising on more esoteric issues of market volatility vs crypto adoption (which underpins most hodler mentalities) for my last post yesterday this market drop started all of a sudden. I had literally just did my chart analysis and started to write, and by the time I went back to take a screen grab, my entire analysis was null and void!
Check out this higher resolution chart to show how sharp these drops were!
This is hopefully a better visible 15 min chart showing the cliffs!
and then there is this to make you cry in your coffee....
Correlations
I am a believer that the wider crypto market basically take its cue from bitcoin.
A bit like a dog pack. When the top dog feels comfortable and ventures out of his kennel, then the others take this cue and come out to play.
As soon as the top dog is spooked, all bolt back into their boxes, tail tucked firmly between legs and tremble in the safest corner of their safe space.
We saw this dynamic in sharp focus over the last 2 weeks.
BTC started to show stability and stronger price action in the markets. Then came some intrepid alts to play outside before the playground gets to busy. Nano, Icon and a few others shot up, then more joined in Dash, Monero, and more.
Many alts were racing ahead in their BTC comparative spurring risk taking.
Then BAM, #btc gets clobbered like a baby seal! And all alts crash hard in unison!
At press time, apart from a few outliers, all alts are deep in red territory vs bitcoin.
And bitcoin at press time has lost 13%
Support
Assuming this correlation, we look to the top dog for signs of sentiment.
The last 6 hours have shown some support at the 6400 usd level but it feels very thin and weak.
The likelyhood of a retest of 6k is quite high.
I still believe there are a lot of buyers in the background that will snap up bitcoins at 6k and support the market, but this is an assumption that I need to challenge to myself.
If you go back in my posts about a week or 2 you will find information where I talk about wading back into to crypto positions but I place protective stop loss trades on btc. These still stand and I am reminded that when I think it is safe to go out and play, sentiment can change against me in the blink of an eye.
I have been developing some theories about the whales in crypto and how they affect TA.
I should be posting this blog post later today.
Stick around and follow my channel if you are interested to learn more about this.
anyway guys, I am sorry to be the bringer of bad news but better face it that cower in denial.
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And as always trade safe and have fun.