BTC/USD
Lets forget the news for a second so we can technically judge the situation.
We have an observable support at around 10,000. That's obviously a strong psychological support. But that support is TOO OBVIOUS, meaning it won't act as support. We have been fed to think this is support because of how many times we have bounced off from it, but that is only training us to think next time it will happen again, that it'll bounce. Once support is hit too many times, in this case already 4 times, it tricks us to think that is a strong support but in reality the market maker only wants us to believe that. Everyone might be thinking this is a good place to long and the price should come up, so they start buying these prices knowing for sure it will come up. To make sure they entered a safe trade, they will put a stop order so they don't get completely screwed up. That red rectangle simulates where these longs might have their stop losses, some might be tight, some others might be more risky, but overall, that area is a good area to find lots of stop orders. So for all of this, the market maker is getting ready to do what? Liquidate them.
So not only longs get stopped forcing them to close their position by selling, but also shorts start to come in, breakout traders, and everyone starts to drive the price lower and lower. So there's caos after this trap settles.
So what do we have here? A well established structure that once it revisits that previous support everyone got trapped in, Retracement traders and previously hurt traders will seek to sell and short again, revenge trading.
All of this is needed for the price to come back up. Institutional money is manipulating these prices this way so they can build their long positions at an efficient level, they don't want slippage due to the size of the position they might want to open so they need "mice" "sheep" "you" the retail trader that will provide the liquidity for them. Up to this point, there's lots of retail traders in the market that got lucky from doing nothing but holding or trading alts in pump and dumps or whatever, or retail traders that are in too much pain from buying at 19,000 that they will be more likely forced to sell once this psychological support breaks. (longs are long gone from those 19,000 levels by now). All these traders are more likely to be weak hands.
This massive retracements have always happened after a big bull run in bitcoin's price. This reminds me of what happened after the bull run to 800 in 2016, and the bull run to 3,000 last year. It doesn't matter what the news are talking about at the time, they will always make sense based on the charts and what the market maker wants.
Be safe and don't feed the whales.
We have an observable support at around 10,000. That's obviously a strong psychological support. But that support is TOO OBVIOUS, meaning it won't act as support. We have been fed to think this is support because of how many times we have bounced off from it, but that is only training us to think next time it will happen again, that it'll bounce. Once support is hit too many times, in this case already 4 times, it tricks us to think that is a strong support but in reality the market maker only wants us to believe that. Everyone might be thinking this is a good place to long and the price should come up, so they start buying these prices knowing for sure it will come up. To make sure they entered a safe trade, they will put a stop order so they don't get completely screwed up. That red rectangle simulates where these longs might have their stop losses, some might be tight, some others might be more risky, but overall, that area is a good area to find lots of stop orders. So for all of this, the market maker is getting ready to do what? Liquidate them.
So not only longs get stopped forcing them to close their position by selling, but also shorts start to come in, breakout traders, and everyone starts to drive the price lower and lower. So there's caos after this trap settles.
So what do we have here? A well established structure that once it revisits that previous support everyone got trapped in, Retracement traders and previously hurt traders will seek to sell and short again, revenge trading.
All of this is needed for the price to come back up. Institutional money is manipulating these prices this way so they can build their long positions at an efficient level, they don't want slippage due to the size of the position they might want to open so they need "mice" "sheep" "you" the retail trader that will provide the liquidity for them. Up to this point, there's lots of retail traders in the market that got lucky from doing nothing but holding or trading alts in pump and dumps or whatever, or retail traders that are in too much pain from buying at 19,000 that they will be more likely forced to sell once this psychological support breaks. (longs are long gone from those 19,000 levels by now). All these traders are more likely to be weak hands.
This massive retracements have always happened after a big bull run in bitcoin's price. This reminds me of what happened after the bull run to 800 in 2016, and the bull run to 3,000 last year. It doesn't matter what the news are talking about at the time, they will always make sense based on the charts and what the market maker wants.
Be safe and don't feed the whales.
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