Market speculation caused the recent Bitcoin fall

[EarnOnVictor]

Conclusively, "nothing more than sales transactions made Bitcoin fall recently." The crypto dropped from the high of above $25,200 to below $21,700 last week before managing to start a minor correction today, and this raised my curiosity about what happened. A lot of reasons might cause the traders' sentiment to be negative on the Crypto in the last 7 days as nothing so fundamental/economical was recently released to warrant such a fall.

In a nutshell, the fear that the FED might still raise the Federal funds rate is part of the reasons the sentiment shifts to the negative side. Investors were smart to start the sales at a reasonable high of above $25,000, which includes positions liquidation. And as you might have noticed, Bitcoin is strongly correlated with the US stocks and equity markets, and almost the same principle applies to every risky asset class at the moment. Due to inflation, the FED has made its intentions known on rate hikes in 2022. It had raised the interest rate by 225bps already, yet another 125bps is still expected before the year ends. I believe speculators regard this more than some other factors at the moment, which slips Bitcoin into selling due to sales. Nevertheless, the year low of $17526.00 in June is still well protected, hope there won't be negative economic factors that will breach that level soon.

Bitcoin will always bounce back, no doubt about that. But one should also be conscious of the economics and investors' sentiments around them for proper guidance in trading or holding it. This made me put this piece together. Mind you, this is my opinion, you might want to let me know yours constructively. Thanks!

[jackg]

I think it's still the effects of:
Higher inflation
Higher interest rates
Less disposable income for the majority of people

Bitcoin has always been strongly driven by the speculators and as it's become larger, those speculators have changed into looking at more things around the market. There's still the case bitcoin probably feel in some ways because some people got bored of holding it (because it was going sideways or because there hasn't been much news on it).

Overall, I don't think we've yet broken away from the pattern the chart has been forming over tha past two months though (it's possible we could do but at the moment that looks to be quite a positive thing to take note of).

[Hydrogen]

Market prices in stocks, bonds, gold, silver and bitcoin. None of them have made logical sense in a long time.

Gold and silver weren't appreciating in value during eras of inflation concern, the way most expected them to. There were reports of COVID shutting down factories in china for weeks in 2020. Before the affects were finally felt in US stocks. Bitcoin price trends haven't made sense in awhile. Even commodities prices aren't making a ton of sense.

The history of this dates back at least a decade. Back to coca cola complaining about aluminum prices affecting beverage can manufacturing. Aluminum suppliers were able to create artificial scarcity in markets by delaying shipments of alu. Which would in turn elevate the price. The opposite is also true. Artificial excess can be created by flooding markets.

Since then speculation has become rampant. Bitcoin was ignored by speculators for a time. But once large institutional investors got in the game, things have definitely changed.

[serjent05]

Isn't it speculation that moves the market?  Demand gets high when there is huge speculation of possible demand influx in the market while supply piles up when there is bad news and speculators thinks that the news will affect the market negatively.  Whether it is a Bitcoin price fall or a Bitcoin price rise, it is always caused by speculation.  I think there is nothing new to it.

Bitcoin will always bounce back, no doubt about that. But one should also be conscious of the economics and investors' sentiments around them for proper guidance in trading or holding it. This made me put this piece together. Mind you, this is my opinion, you might want to let me know yours constructively. Thanks!

Well just to make things easier without the worries of short-term crashes and surges, it is always better to just invest for the long term.  This at least saves us the worries of all short-term what-ifs of bitcoin.  In honesty, knowing the market sentiment is exhausting since it changes from time to time with a small time interval.  Since we share the same opinion that Bitcoin will bounce back, once we had our Bitcoin I think there is no need to worry about the market sentiment since we already know that Bitcoin will bounce back if ever its price crashes.

[Fortify]

Conclusively, "nothing more than sales transactions made Bitcoin fall recently." The crypto dropped from the high of above $25,200 to below $21,700 last week before managing to start a minor correction today, and this raised my curiosity about what happened. A lot of reasons might cause the traders' sentiment to be negative on the Crypto in the last 7 days as nothing so fundamental/economical was recently released to warrant such a fall.

In a nutshell, the fear that the FED might still raise the Federal funds rate is part of the reasons the sentiment shifts to the negative side. Investors were smart to start the sales at a reasonable high of above $25,000, which includes positions liquidation. And as you might have noticed, Bitcoin is strongly correlated with the US stocks and equity markets, and almost the same principle applies to every risky asset class at the moment. Due to inflation, the FED has made its intentions known on rate hikes in 2022. It had raised the interest rate by 225bps already, yet another 125bps is still expected before the year ends. I believe speculators regard this more than some other factors at the moment, which slips Bitcoin into selling due to sales. Nevertheless, the year low of $17526.00 in June is still well protected, hope there won't be negative economic factors that will breach that level soon.

Bitcoin will always bounce back, no doubt about that. But one should also be conscious of the economics and investors' sentiments around them for proper guidance in trading or holding it. This made me put this piece together. Mind you, this is my opinion, you might want to let me know yours constructively. Thanks!

I wonder if the recent announcement that the lead developer and one of the few people with access to the Bitcoin github account has announced their retirement is anything to do with it. It has to shake a little confidence because ultimately the people in charge of the development side can do a lot of damage if control was passed over to the wrong people. It seems inevitable that the crypto market will continue to fall as the rates go up, as you might find that a large portion of the money pumped into Bitcoin and altcoins was funded in large part by super low cost loans which governments around the world were trying to push to stimulate economic activity.

[Rruchi man]

Bitcoin will always bounce back, no doubt about that. But one should also be conscious of the economics and investors' sentiments around them for proper guidance in trading or holding it.

Consciousness of the economics and the investors is needed to influence your trading decision, but IMO it shouldn't affect your decision to HODL. Hodling bitcoin is a choice and decision you have to make that you must realise will not be an easy ride, so you just have to really decide to or not to. Taking full consideration of the economist and the investors can slowly affect your strong resolve to hodl.

[DrBeer]

As unpleasant as it is for all of us who believe in cryptocurrencies, but:
1. The entire crypto market is completely speculative so far
2. This asset has no real value. No, I agree - it can be estimated in terms of spent energy, mining equipment, etc. But these are COSTS. Values, I'm talking about the real value for the market, economy, industry, for this product, at the moment - no!
3. Blockchain technology is not the same as cryptocurrency. Blockchain is a TECHNOLOGY that has real applications and real value. Do not confuse cryptocurrency with blockchain technology!

Considering 1 and 2, we come to a disappointing conclusion - this whole market is controlled speculation. There is no increase in real value, there are manipulations.

[2stout]

Appears this may be due more global economic conditions, i.e. inflation damn near everywhere, moreso than speculation.  I would bet the institutional investment houses are really capitalizing, increasing their Bitcoin holdings at the expense of weak hands and panic sellers.  Fellow HODLers are doing fine as well, filling bag too at these bargain prices.

[trendcoin]

There was a price action that went up from $18,000 to $25,000. It could be the first wave of a big 5th impulse wave. The price drop we are experiencing now could be a correction. I agree with the OP, Bitcoin will come back again, we need to have a correction for now. I think we are talking about a normal situation in financial markets. Also, the equation 1 BTC = 1 BTC always works. Actually, we don't need to be too hard on ourselves. :)

[crzy]

Appears this may be due more global economic conditions, i.e. inflation damn near everywhere, moreso than speculation.  I would bet the institutional investment houses are really capitalizing, increasing their Bitcoin holdings at the expense of weak hands and panic sellers.  Fellow HODLers are doing fine as well, filling bag too at these bargain prices.

The market is also affected by this economic situation and it looks like crypto market can’t pump that much while the world economy is still down and many countries now are dealing with a higher inflation. We should not expect too much from Bitcoin, and if the price dumps again just take that opportunity to buy and hold until it recovers. It’s always to buy at a cheaper price, don’t just panic their and start doing action.

[Hamphser]

Appears this may be due more global economic conditions, i.e. inflation damn near everywhere, moreso than speculation.  I would bet the institutional investment houses are really capitalizing, increasing their Bitcoin holdings at the expense of weak hands and panic sellers.  Fellow HODLers are doing fine as well, filling bag too at these bargain prices.

The market is also affected by this economic situation and it looks like crypto market can’t pump that much while the world economy is still down and many countries now are dealing with a higher inflation. We should not expect too much from Bitcoin, and if the price dumps again just take that opportunity to buy and hold until it recovers. It’s always to buy at a cheaper price, don’t just panic their and start doing action.

Even we do know back in the past that crypto market cant really be that much affected with economic situations externally but now it is really quite evident that it is really been that affected although not 100%

but it do really plays a role when it comes to price development or shall we say on overall market movement.Its really easy to say that we shouldnt really panic when times like this hit had on the market.

You would really be thinking that this might be a very long bear market which means that your investment will really be ending up on getting hold up for long term.
No one knows on whats the actual reason on why we are declining but much sure that everything is interconnected.

[Jaksjol675]

I think this is because of the wider global climate. It's not just in the crypto world things are not looking good.

Recession looms, inflation is soaring, interest rates are rising and living costs are biting. Stock markets are wobbling too, with the US S&P 500 now in a bear market (down 20% from its recent high).

As a result, even the big investors are less free with their money. And many ordinary investors - not rich hedge-fund owners or corporations but people like you and me - have less to invest in anything, full stop.

[Don Pedro Dinero]

Conclusively, "nothing more than sales transactions made Bitcoin fall recently."

Of course, when the price falls, it is because more people want to sell than buy, so those who end up buying end up doing so more cheaply. Conversely, when the price rises, it is because there is more buying pressure than selling pressure. But that doesn't tell us anything.

The only thing I hope is that if we go below the price of 20,000 USD again, it won't be for long. I see that as unlikely, because below that level many people find the price very cheap and place buy orders.

But I don't think that for the rest of the year the price is going to go up too much.

Here we seem to be complaining about speculation because the price is not doing as well as we would like but if bitcoin went from 0.008 USD to 1 USD it was thanks to speculation. When it reached 10, 100 and 1,000 USD it was also thanks to speculation.

Let us not forget this.

[EarnOnVictor]

Market prices in stocks, bonds, gold, silver and bitcoin. None of them have made logical sense in a long time.

Gold and silver weren't appreciating in value during eras of inflation concern, the way most expected them to. There were reports of COVID shutting down factories in china for weeks in 2020. Before the affects were finally felt in US stocks. Bitcoin price trends haven't made sense in awhile. Even commodities prices aren't making a ton of sense.

You got me thoughtless with your reply as you have practically mentioned all the asset classes in the financial market, and still label them as what does not make sense. Now tell me, what makes sense in your view?

I think it's still the effects of:
Higher inflation
Higher interest rates

You hit the right point with the effect of higher inflation. This is pushing FED into the aggressive rate hikes, which might further be pulling the risk-on asset down for now, including Bitcoin.

The market is also affected by this economic situation and it looks like crypto market can’t pump that much while the world economy is still down and many countries now are dealing with a higher inflation.

This is very true, Bitcoin has a higher chance to recover (even fully) when the world's economy is back to normal where inflation is heading south.

Isn't it speculation that moves the market?  Demand gets high when there is huge speculation of possible demand influx in the market while supply piles up when there is bad news and speculators thinks that the news will affect the market negatively.  Whether it is a Bitcoin price fall or a Bitcoin price rise, it is always caused by speculation.

Thanks for sharing. Nonetheless, you should know that my point on this thread concludes that sales transactions made Bitcoin sell last week. This might start the selling, speculations would always be the aftermath that will make it slip into more bearish mode. In other words, sales and profit-taking activities could crash Bitcoin and speculators would detect this and react promptly. This would then aggravate the negative bias. I hope you understand.

[tbterryboy]

Of course, when the price falls, it is because more people want to sell than buy, so those who end up buying end up doing so more cheaply. Conversely, when the price rises, it is because there is more buying pressure than selling pressure. But that doesn't tell us anything.

The only thing I hope is that if we go below the price of 20,000 USD again, it won't be for long. I see that as unlikely, because below that level many people find the price very cheap and place buy orders.

But I don't think that for the rest of the year the price is going to go up too much.

Here we seem to be complaining about speculation because the price is not doing as well as we would like but if bitcoin went from 0.008 USD to 1 USD it was thanks to speculation. When it reached 10, 100 and 1,000 USD it was also thanks to speculation.

That could be the real cause of the fall. Sales transaction and not sales talk or speculation because they are only words without an action. I think that people sell by the time btc reach 24k because they are afraid that btc will fall again and will take time again to recover so for them to gain contentment, they already made an advance move.

Now that btc have fell down, many people are going to buy it again and that should make the price recover. No one complains about speculation but maybe only the op because he thinks this the reason behind the recent decline. Speculation is normal here in crypto so all are used to that already.

[EarnOnVictor]

Of course, when the price falls, it is because more people want to sell than buy, so those who end up buying end up doing so more cheaply. Conversely, when the price rises, it is because there is more buying pressure than selling pressure. But that doesn't tell us anything.

The only thing I hope is that if we go below the price of 20,000 USD again, it won't be for long. I see that as unlikely, because below that level many people find the price very cheap and place buy orders.

But I don't think that for the rest of the year the price is going to go up too much.

Here we seem to be complaining about speculation because the price is not doing as well as we would like but if bitcoin went from 0.008 USD to 1 USD it was thanks to speculation. When it reached 10, 100 and 1,000 USD it was also thanks to speculation.

That could be the real cause of the fall. Sales transaction and not sales talk or speculation because they are only words without an action. I think that people sell by the time btc reach 24k because they are afraid that btc will fall again and will take time again to recover so for them to gain contentment, they already made an advance move.

Now that btc have fell down, many people are going to buy it again and that should make the price recover. No one complains about speculation but maybe only the op because he thinks this the reason behind the recent decline. Speculation is normal here in crypto so all are used to that already.

Why are contradicting yourself? You have carefully differentiated between sales transactions and sales talk, so why are you concluding that the speculation is not the reason why Bitcoin fell? See, many of you are just writing what you don't know. Both buy and sell transactions and speculations are the heart of the financial market, they can cause spikes or dives since they are what they use mainly for the market sentiments. And if speculation is normal as you indicated, can't it crash the market? So why contradicting yourself both in favour and against it in just one post?