Bitcoin (BTC) has started the day in red and has now plunged below the 21 day EMA as the bulls seem to be losing the battle. There was an attempt to force the price up towards the top of the descending triangle but so far it has failed miserably because as I pointed out in my last analysis on Bitcoin (BTC), this was not real buying interest in the first place. It was just the market makers shaking out greedy bears which resulted in the price pumping short term. Before we delve further into this analysis think about this. How crazy is it that people expect the price to rally on Tether pumps every time we see bad news about Tether and Bitfinex?!
The bulls are celebrating bad news regarding Bitfinex/Tether because they expect Tether fueled pumps! It does not take a genius to figure out how all of this is going to end. The greed, the complacence, and the sloppiness it has just become too much for the market makers not to exploit. They shook out the bears on the way up but let us not forget that this was not their main objective; it was just a side objective. Why would the market makers go after the 30% of traders that are short on Bitcoin (BTC) when they can go after the 70% that are long on Bitcoin (BTC) considering it would be much easier to shake out the bulls. If the market makers could do it, they would want to shake out 30% of the bears as well as 70% of the bulls. They would do both, but there is a balance that they have to find. Pumping the price up to shake out the bears comes at a cost. They have to hand out big payout to 70% of the bulls that cash out as BTC/USD is going higher. They cannot afford to do that anymore because it’s not viable.
So, what’s the game plan here? The market makers want to shake out the insanely high number of longs (70%) but they don’t want to spook them. However, they face another challenge and that challenge is that if they go slow with the decline, a lot of shorts will stack up and then they will have to pay them as well. So, again, they have to find a balance between the pace of the decline and keeping the bulls optimistic while they dump on them. If we look at the weekly chart for EUR/USD, we are very close to seeing some game changing developments in major markets.
The EUR/USD pair is ready to decline to 2016 lows soon as we have a break below the descending triangle. It could happen this week, the next week or maybe the week after but the fact remains that it is inevitable. It has to happen sooner or later and when this happens, you do not want to be holding Bitcoin (BTC). Sure, there are people who say they would keep holding even if the price falls to $1,000. They don’t want to preserve their gains or increase their coins and I have nothing to say to them if they are fine with that. However, for those that are interested in buying opportunities, times like these call for a little more patience because in the months ahead we will see Bitcoin (BTC) fall below $3,000 and that is when you can start accumulating long term.
Source: CryptoDaily.co.uk
Original Post: Bitcoin (BTC) Plunges Below 21 Day EMA Amid Weakening Bullish Resolve
