Christmas Dump

//Christmas Dump

Christmas Dump

Hi guys!

What a morning, huh?? Everything is going down, red candles everywhere. Let’s go over the situation together…

What’s going on?

Well, what’s happening right now is the correction that BTC has been needing for a while now. BTC has had an insane bull run, going parabolic like no other asset ever in history. This could not go on guys! No market can continue going only up. A market needs corrections, and what we see now is exactly that. So don’t panic – this is all natural and expected.

So why is it happening just now? Well, the massive FOMO into bitcoin has been largely fueled by the expectations of the launch of Bitcoin futures on the regulated commodities exchanges CBOE and CME which happened about one and two weeks ago respectively.

When Bitcoin reached $10,000, mainstream media went into a frenzy with front page stories about this all over the world, and madness took over, pushing Bitcoin to a high of $20,000 in the big markets, at the time of CME’s opening.

What then happened was nothing… CBOE or CME didn’t come in and change the world in a day. Nothing changed. Exchanges like that and their institutional investor clients work with a range of restrictions that will make it take some time before we start to see a real effect on the market. Their trading volume has been miniscule so far.

So the disappointment from the opening of these futures markets combined with the tremendous fatigue of Bitcoin resulted in this inevitable dump we’re seing today – getting Bitcoin out of its massively overbought state. This is no reason for panic.

What to expect?

Where is the bottom? We can’t say for sure. At the time of writing Bitcoin already went down and bounced on the 0.382 fibonacci level of the mid term market cycle that it just finished. This means that it has sufficiently retraced, and the bull run could continue again from here.

Panic has started to spread though, and Europeans will soon wake up to see red figures everywhere. A lot of amateur investors will be panic dumping their Bitcoins which they bought at the top. Mainstream media will further fuel the panic with stories about how Bitcoin lost so much value in a few hours, and you’ll hear the usual talk about tulips. etc.

So we could very likely see it go down lower. Next support level is the mid term 0.5 fib which converges with the short term 0.618 creating a very strong support at the 11,000 – 12,000 area.

Should this level break after a bounce, we are probably going to go all the way to 8,000 – 8,800 level, which would be past resistance becoming support and very likely a reversal. It is not unlikely at all that we’re gonna go all the way to this level, which would create a very sound foundation for a futher uptrend to new heights.

What to do?

We’ve been warning people to stay out of Bitcoin for a long time, because we knew that this correction was coming. If you bought Bitcoin anyway, you have a few options. One is to just hold it and wait for it to come up again. If you prefer to cut your losses and rebuy it lower, you should sell it on top of a bounce, never when it’s dumping.

For solid alts like ETH, LTC, NEO, BCH – these tend to follow BTC price, and when BTC recovers, they will too. You’re probably best off just holding on to these.

For other alts, it really depends on the chart. If you forgot to set stop losses and now stuck, you are probably best off just waiting for the coins to go up again.

Well guys, I hope this update helped some of you get a better picture of the situation this morning. Don’t panic, we’ll be on the moon again soon.

By | 2017-12-22T04:59:24+00:00 12 months ago|Categories: General|0 Comments

About the Author:

Co-founder of CoinRunners, serial entrepreneur and long time equity trader for more than 10 years. Switched almost exclusively to coin trading in 2017 and has since managed coin funds for private investors.

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