Following the recent moves and news in Bitcoin and digital assets, Marcus Sotiriou, who is the Sales Trader at the UK-based digital assets broker GlobalBlock noted that the current Bitcoin crash may not be the end of the current bull cycle.
In the early hours of Saturday morning, Bitcoin fell from $53,890 to approximately $42,000 pulling down a majority of altcoins with it.
According to Marcus Sotiriou, the sharp drop came as a surprise to most crypto investors since many were expecting a rally going into the end of the year. The markets have seen huge amounts of selling by crypto ‘whales’ who have been moving Bitcoin from crypto wallets and depositing it into crypto exchanges at a staggering rate.
There has also been a cascade in liquidations with over $2 billion of leveraged positions being wiped out on Saturday.
The deleveraging of the crypto asset positions was exacerbated by the fact that it occurred on a Friday night in the US and coincided with the weekend in Asia, which is one of the lowest periods for liquidity in the markets.
Sotiriou noted that as a result of the reduced liquidity, even though leverage was lower than it has been in previous crashes, the effect was still substantial and shoes that although the markets have become more efficient over time, there is still a long way to go to avoid such situations of forced selling.
According to Sotiriou, despite all the events that transpired before the plunge, other factors contributed to the fall.
According to Sotiriou:
“This risk aversion is down to several factors, including worries regarding the Omicron variant, Evergrande moving closer to default, and, most importantly, in my opinion, institutions wanting to secure profits going into the year-end to manage risk. However, I don’t think this is the end of the bull cycle and believe this sell-off has given weight to the lengthening cycle theory, where this bull market could extend into 2022, contrary to many analysts’ expectations of a blow-off top in 2021.”
The post GlobalBlock’s Sales Trader says the recent Bitcoin crash may not be the end of the current bull cycle appeared first on The Home of Altcoins: All About Crypto, Bitcoin & Altcoins | Cointext.com.
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