Tuesday, November 27, 2018

Fear, hate and opportunity: how crypto traders experience the current drop?

Fear, hate and opportunity: how crypto traders experience the current drop?

Fear, hate and opportunity: how crypto traders experience the current drop?


In 2018, there was no more unprofitable week for the crypto market than the previous one. On Sunday, November 25, the bitcoin exchange rate updated its 12-month low, dropping to $3838 and losing more than 26% in a week. Bitcoin was followed by other coins: ether dropped to $115, losing its place in the market. The second most capitalized coin was ripple, which is trading at $0.37. And the total capitalization of the crypto market for the week decreased by $ 57 billion. In this situation, many market players panic, while others found it possible to earn money. DeCenter learned what traders and large investors are doing during the current drop, as well as what the forecast of leading analysts is.

For the second week in a row, the cryptocurrency market is in a state of collapse.

Today, for the first time since the start of this bear market, I've seen people capitulate, admit defeat, ridiculing the community and technology and promising never to touch cryptocurrencies again. Even the bravest are quiet today...
Confirmed his words and other participants of the crypto world, who have lost impressive investments over the past week. So, according to the news portal Bitcoin.com. one of the users of the English-language anonymous web forum 4chan got rid of all his crypto-investments and urged others to do the same: "This is the end, I sold everything. I'm free. I got out of this fucking scum hell... it was fun at First, but now it's more like a bad joke. I bought bitcoin for $15,000. No one can calmly watch his money evaporate right in front of his eyes. You all know it's going to be $ 3,000, right?... Let's stop pretending that the market will be something other than a bearish trend until 2020."

The massive sale of digital assets by traders also affected long-term bitcoin holders who invested in the first cryptocurrency in early 2017. This is evidenced by the data of the cryptocurrency trading company Genesis. The head of the company, Michael Moreau, notes that investors who purchased bitcoin at the beginning of last year for the first time began to sell their assets approaching their base value when buying. So, investors who in the first quarter of 2017 bought bitcoin for $ 900 - $1300, saw its explosive growth, which at the peak noted a historical maximum of $19,783. However, the current market situation does not give them hope that something will change in the near future.

In an interview with American Forbes, the crypto trader and digital currency investor known as Altcoin Therow (Altcoin Thoreau) also noted that there are no signs that the bear market is coming to an end: "the Price indicates that the trend was going down after 2017, when cryptocurrencies were at their peak. Despite the fact that the current state of the market is very different from the last parabolic pattern of bitcoin, which we saw in 2013, we can safely say that the trend reversal will take some more time. The last bear market lasted more than 600 days, and the current one, at the time of this writing, is only 344 days."

This is evidenced by the well-known crypto-analyst and founder Woobull.com Willie Wu, who believes that the real bottom of bitcoin is only ahead, and the end of the bear market will not come before the second quarter of 2019: "the Latest data obtained from our blockchain and macro - market indicators are still relevant. Changed indicator NVTS, which broke its support, which is a signal to sell. All our blockchain indicators indicate a bearish trend. NVT, NVTS, MVRV, BNM, NVM. Of course, they are experimental, but they still gave very accurate forecasts, even when traditional stock indicators said otherwise. While some catalyst will not affect the change in trend, we will see a bear market until mid-2019".

According to Wu, before the end of the bearish trend, bitcoin will either capitulate or trade in a sideways trend. As for the altcoins, the market players will pump them. At the same time, most of the profits from trading altcoins will be directed to bitcoin, which by that time will reach its bottom and will be ready to start an uptrend, which will last until the next decline in the reward for the block in 2020.

At what level to wait for the bottom?
The head of the American Civic startups and well-known counselor in the crypto industry Winnie Lingam gives a conservative estimate for the stock market. Like many other players, the expert does not think that bitcoin will break the level of $6000 until the end of 2018. According to the analysis of crypto-analyst Murad Mahmudov, bitcoin is in the state of a long-term descending triangle.

So, if the current market trend continues, the first cryptocurrency will break the bottom, going below $ 3000 until the end of 2018.

The lower limit at $ 3000 is not beyond the probability provided that the pattern of the descending triangle reaches the end.
The possible level of support for bitcoin in $3000 says the chief analyst of the social trading platform eToro Mati Greenspan: "we can not say for sure. Now bitcoin has broken the key psychological level of $ 5000, which means that the next logical level of support, which we will see on the charts, will be $3000. However, this is not necessary, and if there is a reversal now, it will definitely be a signal to the bullish trend."

Specialist in technical analysis from the company Cracked the Market Yani Sedins also sees the lower limit of the exchange rate of bitcoin at $3500, after which the market will begin to rehabilitate himself: "it is possible that a rebound will occur in the neighborhood of $3500 and return rate of up to $5,000. Of course, now it does not sound like a significant change, given the current drop in prices, but the return of $3,500 to $5,000 — it's almost 50% payback in a few days of work."

Traditionally, bitcoin will be followed by other cryptocurrencies. So, over the past week, most cryptocurrencies, with the exception of stablecoin, including ether, bitcoin cash, litecoin and ripple, lost from 10% to 40% of the previous value.

It is noteworthy that the data kollebaniya not very concerned institutional investors. It says the head of Department on work with digital assets VanECK gábor Gurbax. In an interview with the American Forbes Gurbax said that large investors are not afraid of the exchange rate of bitcoin to $3000, however, as in $10,000. They are more interested in infrastructure and its growth rates, which make this sector very attractive for investment: "Large financial institutions focus more on the proper structure of the market than on short-term price fluctuations. How to calculate the value of a digital asset? How to ensure their safe storage? Will they have access to crypto-ETFs with the correct market structure and how to protect their investments? For the most part, large financial institutions do not care if bitcoin finishes 2019 at around $3000 or $10,000. I see that the market structure is improving every day and is becoming more like a commodity market or stock market."

At the same time, over the past two weeks, the interest of large investors in bitcoin futures on trading platforms owned by CME and CBOE has increased dramatically. Futures allow you to play against bitcoin, making a profit from the fall of the cryptocurrency market. According to Bloomberg, on Monday, November 19, the total number of open positions on bitcoin futures rose to 22,266 — a historic high.

The current drop is the time for new opportunities
It is obvious that not all market players see only losses in the current situation. As noted by Mati Greenspan, despite the current collapse, the digital asset market has not lost its attractiveness for some investors:

This is definitely a demand market!
Now the most interesting for investors are bitcoin and ripple. This is evidenced by the data of eToro, according to which, the clients of the trading platform increased their deposits in these coins.

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@Etoro's customers took advantage of the bitcoin price collapse to replenish their stocks. The red circle marks a small but obvious increase in assets, since November 14.
Moreover, Greenspan believes that now panic and weak players leave the market: "Many crypto traders are happy to continue to walk, even despite such low prices. I suppose that large financial institutions also find the current prices extremely attractive for the purchase of cryptocurrencies."

A similar opinion was shared by the founder of Super Margin Armen Gevorgyan during a panel discussion at the international blockchain conference Crypto Event RIW. The entrepreneur believes that institutional investors are now investing in digital assets, but do it gradually and in small parts.