Bitcoin Crash? Stop Listening to the Fake News in the Media, It’s Just a Classic Pullback.
When in doubt, zoom out.
As I write this, the price of Bitcoin is still below $90K to $88K. After a period of sideways consolidation lasting several weeks - long weeks for some - a massive liquidation took place over the weekend, sending the price of Bitcoin plummeting.
If you'd like to know more about the details of this massive liquidation, it's over here:
Nearly $1B of Liquidations in the Bitcoin and Cryptocurrency Markets. What’s Going on?
Is this the start of the Bear Market? What should you do?
No one reason in particular, but rather a combination of factors led to the current situation. That's all the media needed to report on the Bitcoin crash. The media love this kind of clickbait headline, which causes panic among mainstream investors who don't understand the reason for Bitcoin.
But in reality, there's nothing crash-like about it. We're simply in the middle of a classic pullback in the Bitcoin market. The funny thing here is that CZ had prophesied this type of headline to be used by the media over 4 years ago now:
We're right in the middle of this scenario. Of course, you've understood that your best interests lie in controlling your emotions. That's always the key with Bitcoin.
CONTROL YOUR EMOTIONS. DON'T PANIC.
The Whales and institutional investors are all too happy to buy the Bitcoin sold by the panickers for less.
As to whether the Bear Market has started, I don't think so. The top is not there for me. I could be wrong, as always, because I have no more guarantees than you do. Simply, you have to understand that the current pullback is rather trivial given what has happened to the price of Bitcoin in recent months.
Before the SEC finally capitulated, all investors had already long anticipated the potential approval of Bitcoin Spot ETFs. This led to a significant increase in the price of Bitcoin from October 2023 to March 2024:
This led to a new Bitcoin ATH around $73K. The price of Bitcoin rose by +171% over these 6 months.
The bullish sentiment prevailed in the market, and many believed that Bitcoin would continue its upward momentum and quickly break the $100K barrier. Contrary to previous cycles, this was not the case. Instead, everyone had to endure 8 months of horizontal consolidation:
This consolidation phase may have seemed like the start of a Bear Market to some, as the price of Bitcoin lost almost $20K in the middle of the summer, dropping from $73K to $53K ... Yet this was also a classic pullback. As the price of Bitcoin rises in weak money, it's important to realize that the pullback will be much greater in absolute terms.
Those who have been in the Bitcoin world long enough had already imagined such a scenario and were hardly moved by the situation. Yours truly is one of them.
The election of Donald Trump was a complete game-changer, sparking a huge bullish wave that broke the $100K barrier in a matter of weeks. There was enormous optimism at the time of Donald Trump's election, as everyone understood that this was the beginning of a golden age for Bitcoin. The price of Bitcoin rose by 59% from $67K to $108K in just over a month:
Sentiment has become extremely Bullish. Greed has overtaken common sense and reasonable investor expectations. Many thought the price of Bitcoin was heading straight for $150K by the end of 2024. As always with the price of Bitcoin, the opposite of what most people expected happened.
Everyone expected Donald Trump to keep his promise to announce a strategic Bitcoin reserve on his first day in the White House. He didn't. Instead, Donald Trump announced a Working Group to study the creation of a national stockpile of digital assets. Everyone was disappointed, myself included, as this opens the door to the addition of Sh*tcoins to this national stockpile, whereas only Bitcoin is legitimate.
Nevertheless, we must keep our heads and appreciate Donald Trump's change of tone regarding Bitcoin, even if it came at the cost of promoting his own Meme Coin for example... Things are moving in the right direction. Even if it will take longer than some had hoped, things are changing for good. As always, patience will make a difference.
Since then, the price of Bitcoin has been moving in a sideways range between $92K and $104K. Then, in the last few days, the pullback hit a local low of $86K:
WHEN IN DOUBT, ZOOM OUT.
If you do this, you see that the price of Bitcoin has fallen by -21% from its mid-January 2025 ATH to $109K. Nothing alarming if you take a step back. A year ago, you would already have signed up for Bitcoin at this price level with all the Bullish news for the future piling up.
But now, the last few months have brought hope, accelerating expectations for the most impatient. This is where Bitcoin brings you back down to earth. And that's a good thing!
Those who complained that Bitcoin was too expensive at $108K will now be able to buy it at $86K unless they make the same mistake as usual:
The entry point is already interesting at $86K for these people, but as always they'll prefer to wait and wait. Maybe the price of Bitcoin will drop to $70K ... or maybe not! Nobody can know, and that's why you have to seize opportunities when they arise. Right now, there's an opportunity. It could be even bigger in the days to come, but looking to buy at the lowest of the low is a loser's errand. And you know it.
While previous Bitcoin cycles have seen more parabolic rises, it looks like things are changing with a different Bitcoin price cycle this time around. This is not surprising, as conditions around Bitcoin are changing with the approval of Bitcoin Spot ETFs and governments showing interest in accumulating Bitcoin shortly. As a result, the size and scale of the capital entering the market changes everything.
The months ahead may be the same as those experienced in 2024, with painful sideways consolidation. This will sort out those who understand Bitcoin from those who don't!
Nevertheless, Bitcoin is not finished with this cycle. That's my feeling, and I think that at the end of this period, the price of Bitcoin will go much higher, as all the Bullish factors for the price of Bitcoin that are accumulating will sooner or later produce a massive effect. Those who seize this opportunity will congratulate themselves. Others will complain that they missed the boat and that the price of Bitcoin is now too high.
The never-ending story with Bitcoin!
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