$49 billion worth of capital wiped out of market in minutes! Time to re-evaluate?

The markets were just getting excited after Bitcoin printed a strong monthly candle, made an 11 month high of $12118, after breaking out of the multi year downtrend, (Reference) and then, BAM the excitement damped down suddenly as BTC made a $1400 move to the downside in minutes, liquidating almost $1.4 billion across various exchanges! source.

The high open interest, and the fact that too many positions were on net long, could have triggered this move. On Bitmex, for example, more than 90% of the liquidated positions were long positions. So whenever there is too much of long positions. or even short positions in the market, we experience this kind of a move, to balance out the market.

ETH also fell by nearly 23% after reaching an 11 month high of around $415.

Let's have a look at the charts to see what the market is up to!

Here's a brief disclaimer before we move on to the next part: I'm not a certified financial advisor, and even though I've been trading for quite a few years, I urge people reading this, and my other posts to #dyor (Do your own research) before taking any decisions! Of course I'm going to help you out if you have some queries/doubts, so feel free to let me know in the comments, or on twitter :)

Last day, as I mentioned in this article, BTC was consolidating in a bullish ascending triangle, which did reach the expected targets, which was almost a 5% move from the time of posting.

Gold, on the other hand is yet to make the similar move, and I can expect that it will make some move by Monday.

So here's the chart:

Chart: BTC/USD, 1H

link: https://www.tradingview.com/x/ITaaUpKk/

Now there are some reasons why I had a small target in spite of the market being too much bullish:

As I mentioned in the article, there was a CME gap around 11.8k (refer next chart)
The sentiments were too much bullish. Literally everyone in the market was bullish, which did win the theory of Contrary opinion, which I covered over a month back.
It is common for BTC to even have 30% retracements in a bull market from the local top before making fresh local highs. But it's still too early to call this a bull market.
There is another gap on CME charts, around 9730-9800 (Refer the below chart)

Note: Although I will never say gaps must be filled, approximately 95% of the gaps get filled eventually, as they act as major price magnets.

Chart: BTC/USD, CME charts, 1D

link: https://www.tradingview.com/x/xGIlwAXE/

Points to note:
This is self explanatory. We can have a retest of the gaps, which is almost a 20% retracement from the local high.

Chart: BTC/USD, 1W

Even though the weekly candle still looks strong, we can't be 100% sure always right? So as per the High timeframes, a possible good buy zone is marked!

Now let's have a look at ETH charts!

I have noticed one thing about ETH charts, and probably over half of all the altcoin charts out there, as most of them look very similar to one another.

As per sentiments, we can see just about everyone was bullish on Ethereum,and some even came up with predictions of $1000 by end of this year, an all time high by Next year and so on.

So have a look at the charts, and all I can say is that if you are in profits, it will be wise to book a small part of your /profits, and wait for the next buying opportunity! But again, DYOR!! I might be wrong.

Chart: ETH/USD, 1W

Points to note:

Probably the most simple chart, we can still see that in spite of the monthly breakout, it is still struggling to close above the multi year resistance.
One reason to be bearish: DeFi craze. The Gas fees is too much! Unless we have the Upgrade, (which, at the time of writing, is taking almost forever), we cant expect it to be feasible enough to be useful in day to day transactions. Who TF will pay $14 in gas fees? (for reference only).
One reason to be bullish: Institutional interest, and the developments going on.

I am 70% sure there will be good buying opportunities on ETH.

Having said these, let's now have a look at the Bitcoin Dominance:

Chart: BTC.D, 1W

Link: https://www.tradingview.com/x/bvmCaRr6/

Although I was calling an altseason since May, I think this is a good time we should re evaluate the markets again!

Even though there was a clean breakdown of the BTC dominance, from the diagonal multi year support, which triggered the altseason, we should be cautious as the dominance seems to have found some support around the zone marked in blue.

There seems to be a lower low, but we cant be so sure. Definitely, a pullback in the overall market is likely, and we may see it retesting the 66-ish percent in near future, before going up or down!

Here is the funny part:

In case you missed out, here's my "Bearish Retest Moon theory" which I posted almost a month back.

I will be reminding about it from time to time, and I may even be wrong, but again, I wouldn't want anyone to take any major financial decisions based on this alone!

So, we can see one thing from the below chart: We already had a small "Moon ride" in the last couple of months, on Altcoins.

Currently it is retesting the previously broken support, as resistance, and we may expect a major pullback before going up again!

It's still funny to see that market works in cycles, "Rinse and repeat" they say! :D But do have a look at the theory, it may interest you!

link: https://www.tradingview.com/x/L9Vig68E/

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