Bitcoin price was more volatile than normal today, and that’s a statement in itself. The normally notoriously explosive cryptocurrency soared more than $ 2,000 and nearly 5% this morning, then crashed, wiping out the entire rally and a few more.
The decline caused the cryptocurrency to drop more than 7% and $ 3,000, leaving liquidations in both directions behind. What caused the sudden storm, and is that just the calm in the eye or is the madness over?
Pump and dump or confrontation between bull and bear whales?
Bitcoin fell sharply from over $ 50,000 and the bulls are now looking to build meaningful support that will hold up. If not, a deeper decline and a bear market remains possible. Right now, whales are either playing games or waging wars against each other in which both sides lose a lot.
Related reading | The Bitcoin price “Pitchfork Channel” could show the last slump of all time
A sharp move in the markets today resulted in liquidations on both sides of the trade, and volatility alone is now placing the market in a state of fear.
A pump this morning caused Bitcoin price to rise more than $ 2,000 and about 5%, only to immediately fall more than 7% and $ 3,000 to break support and lows. Anyone caught buying what they thought was an outbreak is now at a loss. And it all happened from bottom to top and then back down again in less than an hour.
The move pictured above took less than an hour | Source: BTCUSD on TradingView.com
Bitcoin price rockets on Litecoin news, crashes after withdrawal
The move was in large part driven by the larger crypto market. Digital assets are closely related to price movement. So when a coin pumps, the rising tide lifts all boats.
Today’s wipe out move was fueled by Litecoin and a suspicious scenario where a fake press release was circulated claiming Wal-Mart was supporting the cryptocurrency. When Wal-Mart denied the claim, an almost instant 30% rally was erased, which also brought Bitcoin price back down.
A Darth Maul is all that’s left on the six-hour Bitcoin price chart | Source: BTCUSD on TradingView.com
What stays on the chart in higher time frames is one that the cryptocurrency community has so affectionately referred to as the Darth Maul candle.
Related reading | Five Bitcoin Price Charts That Suggest Bulls Have Little To Worry About
This type of wiper candle is a doji with an extremely long wick in both directions that forms the Star Wars villain’s lightsaber. The impact they can have on investors and traders is almost as nefarious as the LucasFilm icon.
Is that for the shakeout, or is there more pain in both directions?
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Featured image from iStockPhoto, charts from TradingView.com