Quick market update on the drops we saw on October 7 and 8, and what I think caused them.
First of all, the selling wasn't limited to crypto. Gold and equities were also taking a hit. But let's focus on what specifically affected crypto.
The first drop came after the US government transferred some Bitcoin to Coinbase Prime. The market usually assumes these transfers could be intended for selling, creating uncertainty and triggering sell pressure.
On October 8, we saw another drop following concerns about AI potentially making hackers more capable and threatening Bitcoin's cryptographic security.
But IMO, the biggest factor was the fear of another October 10.
Most of you remember what happened back then. A lot of altcoins practically went to zero, and people took massive losses.
That experience is still fresh in people's minds. When the market started dropping again, people began thinking, what if it happens all over again? What if we lose everything?
So instead of waiting, people started closing their positions to avoid getting caught in another major sell-off.
I think this fear played a major role because it wasn't just about the news. People were actively reducing risk because they didn't want to experience the same thing again.
And obviously, altcoins took a much bigger hit. They have lower liquidity and are more vulnerable to aggressive selling, so when everyone rushes for the exit, the damage is usually much worse.
Now, here's the important part.
If the market starts recovering from here, it would suggest these factors were largely responsible for the sell-off and we could see another move higher.
The next few days will be important. We'll get a better idea of whether the market is preparing for new highs or whether there's more pain ahead.
For now, I'm watching how the market reacts rather than jumping to conclusions.
Personally i am positioned for the upside as i bought the dip
I'll keep you guys updated as things develop.
First of all, the selling wasn't limited to crypto. Gold and equities were also taking a hit. But let's focus on what specifically affected crypto.
The first drop came after the US government transferred some Bitcoin to Coinbase Prime. The market usually assumes these transfers could be intended for selling, creating uncertainty and triggering sell pressure.
On October 8, we saw another drop following concerns about AI potentially making hackers more capable and threatening Bitcoin's cryptographic security.
But IMO, the biggest factor was the fear of another October 10.
Most of you remember what happened back then. A lot of altcoins practically went to zero, and people took massive losses.
That experience is still fresh in people's minds. When the market started dropping again, people began thinking, what if it happens all over again? What if we lose everything?
So instead of waiting, people started closing their positions to avoid getting caught in another major sell-off.
I think this fear played a major role because it wasn't just about the news. People were actively reducing risk because they didn't want to experience the same thing again.
And obviously, altcoins took a much bigger hit. They have lower liquidity and are more vulnerable to aggressive selling, so when everyone rushes for the exit, the damage is usually much worse.
Now, here's the important part.
If the market starts recovering from here, it would suggest these factors were largely responsible for the sell-off and we could see another move higher.
The next few days will be important. We'll get a better idea of whether the market is preparing for new highs or whether there's more pain ahead.
For now, I'm watching how the market reacts rather than jumping to conclusions.
Personally i am positioned for the upside as i bought the dip
I'll keep you guys updated as things develop.