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It looks like a big player is setting a trap, encouraging people to turn into exit liquidity. This drop was meant to happen, so what should we expect next? Let's dive into the details and find out how to navigate these red days. đ§”
A Massive Flash Crash
A significant flash crash occurred last night, pushing many altcoins to new lows. Overnight liquidations exceeded $1 billion, with over 90% of them being Longs.
Many believe this is happening against the backdrop of the S&P 500's decline and various geopolitical factors.
Understanding the Market Manipulation
Markets are like a big game, where major players can manipulate prices with minimal effort. News around the world often serves as tools for this manipulation. Recently, a surge of negative news has created panic in the market, which manipulators have exploited.
However, I believe the situation is more complex than simply targeting to smoke out paper hands on this drop. Opinions of an upcoming alt season began to circulate widely. I, too, believed we were nearing it when $BTC dropped to $58k a few months ago. But I was mistaken, which means the manipulators successfully deceived me, too.
The True Cause of the Flash Crash
Various analysts are increasingly entering the market, forcing the manipulator to consider the majority of opinions and develop a strategy to deceive them. After much brainstorming, I concluded the true cause of this powerful flash crash. With opinions about the alt season coming from all corners, people held onto their bags and were ready to buy every new dip. However, the market can't grow with too many passengers.
When the manipulator realizes that people "refuse to sell," they arrange a significant flash crash. Looking at the $ETH chart, this drop appears quite alarming. This drop is causing fear, and many are already selling their holdings. However, given the large number of experienced players, it's likely that many are also buying during this dip.
Potential Market Growth
Many people's bags have reached 70-80% losses, and many have already run out of stablecoins. Further growth for such people will be hoping to close all or most of their positions to break even to buy back lower in case of another strong dip. Thus, up 40-50%, the market will just go back to the average values of this spring.
Tips for Staying Strong and Resilient During Market Fluctuations
1. Stay Informed:
- Keep up with market news and updates to make informed decisions. Understanding the factors driving market movements can help you navigate volatility more effectively. Stay updated with reliable sources and market analyses to anticipate changes.
2. Emotional Discipline:
- Avoid panic selling by sticking to your long-term strategy. Market downturns are often temporary, and maintaining a disciplined approach can help you stay on course. Emotional control is key to surviving and thriving in volatile markets.
3. Community Engagement:
- Join discussions with fellow investors to share insights and stay motivated. Engaging with the community can provide valuable support and help you stay resilient during challenging times. Learning from others' experiences and strategies can offer new perspectives and bolster your confidence.
4. Diversify Investments:
- Spread investments across different asset classes to minimize risk and reduce the impact of market volatility on your portfolio. Diversification helps in balancing losses with gains from other assets, making your portfolio more resilient.
5. Buy the Dip:
- Identify fundamentally strong cryptocurrencies and buy at lower prices. This strategy allows you to accumulate assets at a discount, positioning yourself for potential gains when the market recovers. Buying the dip requires patience and a keen eye for market trends.
6. Staggered Purchases:
- Use dollar-cost averaging to gradually build positions. This approach helps mitigate the impact of short-term price fluctuations and reduces the risk of making large investments at inopportune times. Itâs a disciplined way to invest over time without worrying about market timing.
Conclusion
To put it simply: The market will grow, people will fear another drop, start selling at breakeven, and increase the share of stablecoins.
Let's stay strong and navigate this market together! đȘđ
