This weekend and its battles are all that matters
The crypto market continues healthy, but there's a clear test ahead.
Weekly musing: does anybody even remember $73k?
Another week, another ATH, another flush. This is healthy and what we need to comfortably continue this rally. But, right now, BTC stands at a crossroads: will it further correct this weekend or will bulls recover and charge back? Let’s analyse.
To begin, BTC started the latest leg of this run in early Feb. and bulls only felt tired a month after. But Friday, at least for a while, momentum was lost with the orange coin falling up to 12% since Thursday’s ATH, as buying stalled. Why?
Many reasons, but excessive leverage was a major one as even sophisticated funds blew up on reckless trades that should supposedly be risk-free. There’s also the meme mania I’ve been covering for a while and overall euphoria (and the rugs).
As usual, the important question is what’s next. Long-term, it’s nearly consensual that the crypto market is approaching a $10 trillion capitalisation within the next couple of years, with TradFi folks joining the degens in chashing this narrative.
Short-term, we’re getting increasingly close to an always-needed correction. No one knows if it’s this weekend, next month (as the halving disappoints the market), or even later - as it’s clear the pump can last longer than most imagine.
What’s important to note is that past sell-offs during crypto bull markets tend to see BTC falling 20% to 30%, sometimes a bit more. And most alts crash more than that. Yesterday’s exception, SOL, perhaps showed bulls there was still hope.
What can you do? First, wait for Saturday’s close close as BTC is falling again. And keep an eye on the levels of fear and greed you see in social media and chat groups over the weekend. Those are typically great signs for a reversal.
Secondly, remember there’s a third alternative scenario that doesn’t involve going up or down this weekend - and that’s the dreaded chop. If everyone is expecting a new high or a new low, then it would make sense to go sideways for a while.
Thirdly, it’s all about the end game. Zoom out and focus on the larger trend if these swings don’t make sense to you. The best investments are hodled for a long time despite the volatility and don’t compare yourself to other fellow degens!
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