Disclaimer for the feds: I never owned any crypto, never traded any crypto, never made any profit and this post is purely for entertaining purpose only. This is not a financial advice.
Introduction
In this post I want to give you a quick, simplified & short summary of why exactly it dropped and whether the drop matters.
BTC drop below 29k – a 1.5 Billion OI flush in minutes
https://preview.redd.it/qeq8023boydb1.png?width=2560&format=png&auto=webp&s=957159e212231d0350a20b7a14b3c724d2df12b0
Taking a look at the chart it's pretty clear what exactly happened. A heavy spot sell off ignited a larger liquidation cascade wiping out over 1.5Bn Open interest, Liquidated ~$9 Million USD all in minutes.
The spot CVD suggest a continouing sell off. In the meantime, the open interest spiked back.
Degen Money as a major driver
Interesting to look at is the quick open interest reversal suggesting a lot of leverage entering the markets with an unstoppable trend. Right now the Open interest is 200 million higher than before the dump. Shorts are covering, bounces happen. Looking at fundings it's pretty clear that a lot of longs got wiped out but also many shorts entered the market. The entire structure suggest that after the move tons of positions were opened betting on both directions – expect more volatility to come.
Who is selling?
https://preview.redd.it/x3fy2gcdoydb1.png?width=2554&format=png&auto=webp&s=8e9266d60c31074de5a640617c828f61418753f9
It's widely known that Coinbase is used by institutions to handle their Bitcoin investments. So whenever I want to find out who's selling I pay attention to the Coinbase CVD & look for divergence compared to the aggregated CVD.
And it does say a lot! The CVD since the dump is on a steady rise suggesting a heavy selling into limit orders. This is most likely caused by Coinbase providing liquidity / market make at current price for a larger entity cashing out thousands of BTC.
Also interesting & visible to look at considering the outstanding high volume at $28,900 suggesting strong support & bidding against the sell off
https://preview.redd.it/om6uhqfeoydb1.png?width=2549&format=png&auto=webp&s=96963956c061f6c9397b8798026b68ea81275ced
AND WHY?
Honestly? Because Crypto is being Crypto. In fact, this is just normal volatility in my book. I know we all had a very calm crabbing over the last months and BTC rarely moved drastically into a direction without bigger news hitting the market. But looking back in time towards 2018-2021 this volatility was just an every day scenario for Crypto.
So… they sell for no reason?
No but it's just a normal market behavior of a larger player most likely lowering their risk exposure with the upcoming week. There are important macro events ( PCE, more earnings, FOMC 25 BPS rate hike… ) this week so it doesn't suprise me to see profit taking happening ahead.
BTC broke below the range lows & it's a normal market psychological reaction to see it as a sell signal. At the end of the day price is driven by supply & demand so always expect high volatility being a posibility independenlty from news
If you are interested to look what the future speculative value brings to the market feel free to look up the obvious contenders for new directional signal include:
– US equity market ( Tech was close to ATH and bad earnings might fuel a further correction which might have a risk off reaction in crypto )
– further development of regulations ( example clarity around Binance & DOJ but also other security related topics )
– Grayscale Bitcoin fund court ruling
– macro releases ( PCE, FOMC, GDP, Jobless claims just this week ) / economic correlations
– ARK ETF
Hope you enjoy the short post and let me know your thoughts!
It’s refreshing to see a genuinely informative post about crypto without any spammy links. Thank you for sharing this valuable information
Give it a week or two & i believe we will be back on that crabbing upward momentum again like a clockwork unless there is really bearish news to push crypto space further down .
I think we are bound for lower prices and with that it’s more accumulation at a great discount. I hope you guys get as much as you want
All i need to know is: It is much better buying at these prices than 30k. Ignore the noise and keep buying.
Good analysis btw OP.
nothing ever goes as planned in crypto world as you know and after couple of days it becomes normal or a bit increase. just wait and watch
Tarkov’s post, so like always top quality! Most of you guys have no idea how skilled he is and how blessed we are to be able to read all this for free. Anyways great read and thanks for sharing your perspective.
This is day trading.
There are not market fundamentals that changed that should/would have an impact on 95% of people.
Who’s selling? Could be US Government dumping Silk Road BTC. I believe they have a lot more to unload by the end of the year.
We need more content like this compared to the constant moon farming posts recycling the same garbage we saw a week ago.
>Who is selling?
Here’s a tinfoil hypothesis: I think it could very well be the US gov selling every rally and trying to crash the prices. They have hundreds of thousands of Bitcoin (and just the other day i believe they just seized another 100k more ).
THey don’t even need to be the ones who actually dumped today, by simply killing any rally above 30k for more than a month this was bound to happen.
I think for the US this is the do or don’t cycle: they must invalidate the “prophecy” of each bitcoin cycle leading to new ATH because if they don’t this time, then it will really be over for good.
They will leverage all the Bitcoins they have accumulated in prior years to try to do so and to kill every rally.
🤡
I just keep my head down and DCA my BTC twice a month. Slow and steady. Good informative read though, well done. Better than the “whos going to jail now” posts…
Good information sir, looks like it bounced off the drop were steady crabbing back at 29k. Holding strong.
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This is the first thing I’ve read here in weeks that didn’t make me wonder why I don’t unsub. Good work.
After 6 months of slowly going up, it’s only logical for it to slowly go down.
If there’s something to learn from pre halving years. It’s that waiting on the side lines more rewarding
It still baffles me how people go into these crazy leveraged positions when crypto is so volatile. Seems every week they get wiped for a couple $100 million
Bitcoin going lower one more time to prepare for the volcano that is about to errupt at the halving in 2024
It’s nice to actually see a post here that was super informative and helpful in regards to the current price movement. Thanks for the info
>If you are interested to look what the future speculative value brings to the market feel free to look up the obvious contenders for new directional signal include:
So based on my analysis, the market could go up or could go down
It’s impressive that u so deep in this market yet not having or trading crypto ever. Very eccentric pastime u have…
I don’t expect to see much action until approval/decision of Blackrock / Fidelity EFT’s and halving. Both happen in early 2024. Unless a black swan comes along I don’t see it dropping lower than 25k – 27k.
Normal volatility imo.
Source: fuckall, trust me bro.
>This is most likely caused by Coinbase providing liquidity / market make at current price for a larger entity cashing out thousands of BTC.
Doesn’t the US government sell seized Bitcoin nowadays?
Hope for the best and prepare for the worst and you will be fine remember that when the big boys FUD they buy when they have good news they sell simple
Thanks for sharing quality content and analysis like for free. It’s a breath of fresh air to find information that is as concise and simple to understand as this is on this sub. Appreciate the work, brethren!
Giving OP a follow, that’s for fucking sure. I just learned more right now, than I have in the last few months about crypto. I appreciate it OP.
New lows by end of year and bleeding into next year. Anyone buying the soft landing myth gets what they deserve. Great buying opportunity though. Do moons go directly to your vault if you opened it?
Nice. Ever since I started approaching crypto with a 5-10 year outlook it’s been almost 0 stress. These dips are a nice opening to accumulate some more then forget about it.
If most were in crypto for the porpuse and not speculation this wouldn’t be a huge deal – but it seems that most are here for a quick buck
No moons but you are doing this purely for the moons. Moons are the undercurrent of everything we do here. Its like the gut bacteria that helps us shit (post)
Holy shit, a high quality post. I’d welcome several more of these day over regurgitated opinion pieces
….and as usual, it happened while I was sleeping and was back up in the 29’s by the time the sun came up here.
On chain showed US Government dumped a big chunk as of a few days ago. And they had yet to announce so they likely weren’t done. They use Coinbase, iirc.
Thank you so much for this! It truly is a breath of fresh air to see quality content again after having to sift through so many useless post! Hope to see more like it 🙂
I don’t see it so I’m going to post it.
“Saylor buys more Bitcoin among dip.”
It’s practically obligatory.
This is exactly the kind of post I want. Explains to me plain and simple without all the people who “think” they know everything bash u for not understanding what it means to cover the naked long margin call double square rooted to the inverse double cross uncross shit.
Edit: OP you should start a channel bet you’d have tons of interest
Serious no moons? I guess he ain’t trying for moons.. any he gets off this should now be donated lol. J/k
This post could have been 5 words or less instead and the message would be exactly the same as it is now.
You’ve managed to post a wall of text and say absolutely nothing meaningful. Impressive.
Great write up.
I was wondering what happened. I’m actually hoping it stays low or goes lower until for the next few months so I can stockpile more at a discount.
Keep it coming my friend, finally shit worth reading.Shall be interesting too see how this plays out.Either way there is money to be made… After reading this it’s time to f around with my Deribit acct…Best of luck..
Great analysis and post OP. A good read indeed. Thanks for taking your time to share your knowledge with us. Cheers!
Good post, significant parts are plagiarized from others’ Twitter posts. You should cite the original authors rather than present this as your own work.
Thanks for taking the time to share. Nice and refreshing to see some well thought out info being contributed
Thanks for writing such a refreshing and concise post. Truly a blessing with the seemingly endless stream of turds we see more and more here.
I appreciate you taking the time to write this.
Holy smokes, am I in the right sub? This is a quality post right here!
It’s been interesting to see how the institutional money acts in a recession, for the most part, it doesn’t, unless they need to minimize exposure to take loans or expend capital
This is a lot of good info you don’t really run into much. Appreciate it! I’ll have to check that next time we have a drop but I’ve never put the 2 together.
A post that someone actually put some effort into?!?!? Not often but it does happen here from time to time. Thanks OP.