What just happened to link? (And Eth)

[retaur]

I have/had a tiny margin long on link that I've been keeping open for a while on a Dex and I've just got a notification that the liquidation price was passed and it looked like it was passed in a way that it either recovered quickly or no liquidator actually wanted to buy the collateral (because a decent chunk of the position remains). Either way, what I'd now like to know is what happened to that and Eth to cause the current price movement? It seems unexpected for a coin to randomly drop 50/75% and immediately recover without it being some random algorithmic failure (or a well intentioned shakeout by a large player to try to get as many as cheaply as possible).

[Charles-Tim]

It also happened to bitcoin. In fact, it was bitcoin that fall, while other altcoins followed. But the difference is that bitcoin is less volatile than altcoins.

It was caused by the additional 100% tariff that Trump said he will impose on China .

[JeromeTash]

Flash crashes sometimes happen, mostly due to panic in the market. In this case, you happen people placing overwhelming sell orders in a very short time in the spot market and those opening shorts in the derivatives market. The price definitely goes down. Don't forget that such actions also trigger stop losses and liquidations, which further increase the number of sell orders or shorts vs. buy orders/longs.

In a meantime there are traders who are quick to catch those price drops, probably with the help of bots, by placing more buy orders at market price. This is why you will see an initial price drop, but then the price rises back up quickly because some people are trying to take advantage of the lower price to buy more ETH or Link.

[retaur]

In a meantime there are traders who are quick to catch those price drops, probably with the help of bots, by placing more buy orders at market price. This is why you will see an initial price drop, but then the price rises back up quickly because some people are trying to take advantage of the lower price to buy more ETH or Link.

I think they took a while to come though. Both were very far down and it looks like the dexes were better collateralised and better with risk management than the cexes which was an interesting comparison to watch.

Now I'm wondering if this is the last of these. I remember the pandemic crash that saw us tumble from $6k to $3k (perhaps even $1.5k on some exchanges) and take ages to recover from the $3k mark. I guess if we do that now, now $3k is $110k then that'll be a lot less boring to watch but it's probably very unlikely we won't rise and then fall further.

[Akbarkoe]

In a meantime there are traders who are quick to catch those price drops, probably with the help of bots, by placing more buy orders at market price. This is why you will see an initial price drop, but then the price rises back up quickly because some people are trying to take advantage of the lower price to buy more ETH or Link.

I think they took a while to come though. Both were very far down and it looks like the dexes were better collateralised and better with risk management than the cexes which was an interesting comparison to watch.

Now I'm wondering if this is the last of these. I remember the pandemic crash that saw us tumble from $6k to $3k (perhaps even $1.5k on some exchanges) and take ages to recover from the $3k mark. I guess if we do that now, now $3k is $110k then that'll be a lot less boring to watch but it's probably very unlikely we won't rise and then fall further.

We're at the end of a cycle, so we need to be more cautious. The decline is perfectly normal in the crypto market. Most people in the crypto market are new and surprised by the current market situation. If they had entered before 2022, they would have said this was normal. What's happening in the market is due to the market's euphoria, and it's already reaching the lower end, so it's not surprising. Technically, the market is trending bearish, but my personal instincts suggest we still have a very good chance of a bullish market. Just be careful, the decline could be much deeper.

The most important thing is not to exceed the $100,000 threshold for Bitcoin and $2,500 for ETH.