Are Crypto Traders Becoming Less Confident The Bottom Is In?

Tony "The Bull" Severino

5 years ago

2 mins read

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A fall in an important Bitcoin-related metric with ties to overall crypto market sentiment over the past couple of weeks, suggests that recent price action across the crypto market has traders and investors increasingly fearing that the bottom isn’t in for Bitcoin, and may be adjusting their expectations and preparing positions in anticipation of the market falling further into the downtrend.

Are Crypto Traders Reconsidering That The Bottom Is “In?”

Crypto traders and analysts will use any information or statistics available to them in order to attempt to gain a competitive advantage over others in the market, such as predicting when trends are about to reverse. After months of downtrend, traders are attempting to do just that, and “knife-catch” the bottom, and are using any tools they can get their hands on to figure out if that bottom is indeed in.

Related Reading | The Biggest FUD and FOMO Moments in Crypto 2019

These tools consist of fundamental analysis, such as stock-to-flow models, hash rate, and network transactions, and technical analysis using indicators, chart patterns, and more.

Some more advanced analysts also look at the ratio and balance of long versus short positions, platform by platform, to get a good grasp of overall market sentiment and how traders are positioning themselves ahead of the next major price movement.

Bitifinex Longs Begin to Fall After Reaching All-Time High

After Bitcoin price touched $6,500, long positions on the popular cryptocurrency trading platform began to spike as traders began to consider the bottom could be in at least for the short-term.

Interesting coincidence:
– after $BTC first time touched 6500$, longs on Bitfinex started to grow (insanely);
– after BTC touched 6500$ second time, longs started to decline.
People thought that it is the bottom initially and now they are not that sure anymore?$BTCUSD #bitcoin pic.twitter.com/5USN6wP5n2

— CryptoHamster (@CryptoHamsterIO) January 1, 2020

However, Bitcoin has failed to produce a strong bounce, and has instead made repeated trips to retest lows, and has even set a new lower low since. The recent price action has caused the long metric to begin to fall for the first time in over a month – after recently reaching the highest point its ever been – suggesting that crypto traders are reconsidering that the bottom may not actually be in, and Bitcoin could be at risk of falling lower.

The idea that a bottom is “in” in a financial market, is only possible in hindsight. Because Bitcoin only one year ago was trading at $3,000, and after a strong rally has fallen back to prices just above $6,000 has crypto traders not only wondering if a local bottom is in, but if the bear market bottom in its entirety is in.

Some steadfast analysts remain unfazed in their conclusion the bottom is in, while others are now expecting Bitcoin to fall to prices of $1,000, bankrupting companies across the crypto industry and leaving the industry itself in shambles.

Given how uncertain the market is for Bitcoin and crypto, it’s no surprise that many traders are beginning to fear the worst and are changing their strategy as a result.

Tony "The Bull" Severino

Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.

Beyond his role at NewsBTC, Tony is the visionary founder of CoinChartist.io, an educational platform aimed at demystifying the nuances of cryptocurrency trading. CoinChartist.io serves as a valuable resource for traders seeking to enhance their technical analysis skills. The platform offers a range of learning tools and resources designed to empower traders with the knowledge to make informed trading decisions.

In addition to his educational initiatives, Tony is a prolific author and a dominant voice in the crypto community. He writes the CoinChartist VIP newsletter, a weekly dispatch that has become a staple among crypto enthusiasts, revered for its insightful analysis and actionable trading advice. This newsletter has consistently ranked as a best-seller on SubStack, boasting thousands of subscribers who rely on Tony’s expertise to guide their trading strategies.

Tony is also celebrated for his literary contributions to the field. He is the author of the highest-rated Crypto Trading Journal on Amazon.com, a testament to his ability to communicate complex trading concepts in an accessible manner. This journal is widely regarded as an essential tool for traders aiming to track their progress and refine their strategies.

Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
His professional affiliations underscore his commitment to excellence and continuous learning. As a partner of Elliott Wave International and TradingView, Tony collaborates with other leading experts to enhance his knowledge and skills. His active membership in the CMT Association further aligns him with the highest standards of industry practices and ethics.

Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.

In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.