he current price of Bitcoin is $4513 with 24 hour volume leveling around 6.7 billion. The influx of volume since the past 2 days is directly correlated to the extreme sell-off that has occurred in crypto over the course of the past seven days.
The market battering began with former 2018 lows being swept, around the 6k mark, on November 14th. Since then, Bitcoin has lost roughly 30% of its value and the total market cap of crypto has followed this trend as nearly 50 billion dollars has left the market resulting in a similar percentage loss.
Faith was lost in a crypto price resurgence once 2018 lows were swept which led to the eventual capitulation across the crypto markets..
This might well be the straw that breaks the camel's back for many crypto investors. 2018 had been incredibly rough but this most recent move introduces the idea that maybe crypto isn't "the future of money" afterall for most spooked investors.
However this is not the case. Price action can be depressing in its current state so it is important to look at how the space is evolving with new market participants building new products and innovating every day.
🤔So...is this actually capitulation??
Well technically, not yet. We need to see a bounce to confirm capitulation. What you should know about capitulation is that it's not the market bottom, prices usually continue their bear trend after a solid bounce, then consolidate slightly lower losing volatility.
The part of the cycle that would be best to re-enter with fiat would be the "return to mean" as Bitcoin trends back about $5k and ultimatley breaks above $6k.
In the traditional market, this could take another year to play out. But this is crypto; a market made up of low volume, high volatility, and valued at only $150bn as a whole. Things tend to move very quickly in this space.
Arguments for this being the final push down include the fact that in the last 7 days Bitcoin has dropped 30%+ all after a period of record low volatility.
The Chaikin Money Flow indicator on the bottom of the chart (attached below) which identifies buy/sell pressure is also showing that sell pressure is the highest it's been since January 2016.
If this post is older than 7 days, please support by upvoting my latest post