Why markets force-sell? How BTC squeeze push the price down?This weekend has been very interesting. BTC is dominating the market price and all other cryptos are forced to follow. However, the demand has dried up and while BTC was still moving up, most altcoins started to slightly move down. Late Friday / early Saturday hype did not save BTC, after a number of high profile people trying hard to hype the market for yet another bull run week overleverage Longs got liquidated. So what happened?
Have you ever heard saying: "Market always wins"? In general, most exchanges always win regardless of the price. Whether it is going up or down, regardless of who wins or losses most exchanges will be charging their fees. However, a little less known fact may surprise you - most exchanges time to time try to force the price up/down to liquidate overleveraged positions. That's right. There are more and more people talking about exchanged purposefully working to earn easy money by liquidating their customer's! This is what happened last Saturday, the 20th of Feb, 10pm GMT. In less than a minute, BTC price dropped to $54k, ETH price dropped to $1800 and bounced right back. According to numerous sources during that 1 minute about $1.8 billion of overleveraged Longs were liquidated. Of course, the price bounced right back after this "force-drop" and markets continued on their regular trajectory afterwards.
Now, we all know this sounds fishy. It does beg a question: what can an average Joe do about it?
We all know that trading is a risky business. You may win, you may lose, however, would you still be tempted to trade if you knew that these markets are always seeking ways to take advantage of you and liquidate your funds? Drop your thoughts in the comments below.
I am not a financial advisor nor a professional trader. My joy and fascination lay with data and technical analysis. However, these market nuances really caught my attention. No one likes to lose or be in a position where others take advantage of you. Everyone with early access to my TA's know that so far we are all making a quite stable risk-averse profit. But the question still remains - what can an average person do not to lose against the market?
What can be done to level the playing field? Share your thoughts in the comments below.
Extra karma points for anyone who can share good insights, research articles or other resources on this topic.
Today's technicals:
Position is short (people with early access already know that we have been shorting since ETH $1860, and already closed today's target! 🥳) (No magic, we just got lucky 😇)
Forecasted highs at 1980 and unlikely 2040
Mid-way point at 1920
Forecasted lows at 1820 and 1780
Have fun trading! 🤑
If you would like to have early access to my TA's, write "I am interested to learn why markets force-sell" or "I am not interested to learn why markets force-sell" in the comments down below 😉
