This is a longer psychological analysis, so it won't give you any short summary of predicted movements. Please spend a few minutes and read from top to bottom if interested, otherwise it has no use.
We had a very steep rally in the last 1-2 days, yesterday BTC price went up cirka 2xxx in a matter of hours. And then it made a sudden negative movement.
As I described in my previous posts, I do not believe that there is a collective consciousness, only collective euphoria and panic. I believe that the steepest part of this rally over 10000 was mostly made of big sudden pumps and following euphoria, or FOMO. The sudden selling was not made by panic, there was no reason to panic. Neither was it made by many small people selling based on practicals at the same time. It was made by a few people with big money, and it triggered stop losses, and made a small avalanche.
The dip was partially bought up by small people because it was considered a correction, and therefore a possibility to buy, expecially for people feeling FOMO and jumping in now.
There is always a certain border between correction and falling. A line which devides human emotions.
Above it, people feel that price makes a correction. Those who are already in either don't really care or buy some more. Those who ""missed the train" try to jump in feeling FOMO, and seeing it as a long awaited opportunity to finally correct their "mistake" and jump in.
But when price goes under this certain level, other kinds of emotions emerge. People who are already in begin to see that their winnings are becoming smaller and smaller, and begin to consider taking out what is left, fearing that they will lose all the winnings that they managed to collect. People who bought above the certain level, or even near the price where it begin to go down might feel that they bought out of FOMO at the wrong time. The most emotional ones sell at once, while people who are less emotional wait, hoping that they just jumped in at a correction, no big deal, price will go up. But the deeper the price goes the more uneasy they become. Take into consideration that these people do not see winnings decrease, as the first group. They see losses increase.
Finally when the border is reached, although with different technicals and emotions in the background, both groups will begin to sell. Why?
Because that's when the term "correction" will turn into the word "falling". Correction sounds healthy and a door to opportunities. Falling sounds like a bad thing, and shifts FOMO to FUD, and ultimately, panic.
Solely based on what the price action tells us, I feel that FOMO and euphoria decreased. What tells me that? It was a sudden big dip, but not an equally big and sudden buy. People became uncertain. The fact that the up move and the following down move was very fast and happened under a short time contributes to uncertainity. But people are still equally uncertain whether it is a correction which they should buy up.
There are two things that will influence the outcome. One is time. Emotions settle down with time, and based on the current trend (of emotions and price) I think that given time, buying mood and FOMO will come back.
The other influence is whales. As said, the biggest sudden upwards pumps and the sudden downwards dip was not made by small investors, it was made by big people who sold lots of BTC under a short period of time. There are two possibilities from my perspective. One is that some whales took profit after the big euphoric rally during the last two days, and at the same time gave a possibility to small people to buy, so they just wanted to take advantage of the high euphoric movement ans their position. The other possibility is that whales willingly made a dip that triggered a small avalanche, and will do it again, step by step, becuse they want to take out their well earned money from around the beginning of the whole rally, and thus price will fall low.
For the small people, I believe that the border between the feelings enad terms "correction" and "fall" is somewhere around 10000. It is a strong psychological level. Not only because it acted as a strong resistance, not only because it is a round number, but also because of it is a 5 digit number after 4 digit numbers. Crossing this line upwards gave a large amount of fuel to price flying high, as said, I believe that this was the ultimate line which triggered FOMO in people who missed the rally from circa 3000. Many people said that we won't see a 4 digit price ever again. If it still happens, it will be a large amount of fuel for FUD and panic.
As said, I don't think that people will sell by themselves right now, and with enough time given (maybe a few days), FOMO, happiness, and buying mood will come back. So I believe the only way to cross the 10000 line between FOMO and FUD, correction and falling, is in the hands of whales, and depends on whether they want to push price under this line violently (violently as they did upwards, like knife through butter).
I can't tell you what the whales think. I just can tell you that I believe this is the state of things, and that 10000 is a very important line and it is worth to keep an eye on it.
This level is also very important from the perspective of technical analysis, based on many factors. About these aspects please read the posts of the traders who are professionals and experts, and post fantastically good ideas. I follow some of them, please check my follow list if interested.
DISCLAIMER:
This is no trading advice. This is just an essay about the possible psychology behind movements.
Thank you for reading!
Please leave a "like" if you enjoyed, or think it was useful.
I wish you luck and winnings!
We had a very steep rally in the last 1-2 days, yesterday BTC price went up cirka 2xxx in a matter of hours. And then it made a sudden negative movement.
As I described in my previous posts, I do not believe that there is a collective consciousness, only collective euphoria and panic. I believe that the steepest part of this rally over 10000 was mostly made of big sudden pumps and following euphoria, or FOMO. The sudden selling was not made by panic, there was no reason to panic. Neither was it made by many small people selling based on practicals at the same time. It was made by a few people with big money, and it triggered stop losses, and made a small avalanche.
The dip was partially bought up by small people because it was considered a correction, and therefore a possibility to buy, expecially for people feeling FOMO and jumping in now.
There is always a certain border between correction and falling. A line which devides human emotions.
Above it, people feel that price makes a correction. Those who are already in either don't really care or buy some more. Those who ""missed the train" try to jump in feeling FOMO, and seeing it as a long awaited opportunity to finally correct their "mistake" and jump in.
But when price goes under this certain level, other kinds of emotions emerge. People who are already in begin to see that their winnings are becoming smaller and smaller, and begin to consider taking out what is left, fearing that they will lose all the winnings that they managed to collect. People who bought above the certain level, or even near the price where it begin to go down might feel that they bought out of FOMO at the wrong time. The most emotional ones sell at once, while people who are less emotional wait, hoping that they just jumped in at a correction, no big deal, price will go up. But the deeper the price goes the more uneasy they become. Take into consideration that these people do not see winnings decrease, as the first group. They see losses increase.
Finally when the border is reached, although with different technicals and emotions in the background, both groups will begin to sell. Why?
Because that's when the term "correction" will turn into the word "falling". Correction sounds healthy and a door to opportunities. Falling sounds like a bad thing, and shifts FOMO to FUD, and ultimately, panic.
Solely based on what the price action tells us, I feel that FOMO and euphoria decreased. What tells me that? It was a sudden big dip, but not an equally big and sudden buy. People became uncertain. The fact that the up move and the following down move was very fast and happened under a short time contributes to uncertainity. But people are still equally uncertain whether it is a correction which they should buy up.
There are two things that will influence the outcome. One is time. Emotions settle down with time, and based on the current trend (of emotions and price) I think that given time, buying mood and FOMO will come back.
The other influence is whales. As said, the biggest sudden upwards pumps and the sudden downwards dip was not made by small investors, it was made by big people who sold lots of BTC under a short period of time. There are two possibilities from my perspective. One is that some whales took profit after the big euphoric rally during the last two days, and at the same time gave a possibility to small people to buy, so they just wanted to take advantage of the high euphoric movement ans their position. The other possibility is that whales willingly made a dip that triggered a small avalanche, and will do it again, step by step, becuse they want to take out their well earned money from around the beginning of the whole rally, and thus price will fall low.
For the small people, I believe that the border between the feelings enad terms "correction" and "fall" is somewhere around 10000. It is a strong psychological level. Not only because it acted as a strong resistance, not only because it is a round number, but also because of it is a 5 digit number after 4 digit numbers. Crossing this line upwards gave a large amount of fuel to price flying high, as said, I believe that this was the ultimate line which triggered FOMO in people who missed the rally from circa 3000. Many people said that we won't see a 4 digit price ever again. If it still happens, it will be a large amount of fuel for FUD and panic.
As said, I don't think that people will sell by themselves right now, and with enough time given (maybe a few days), FOMO, happiness, and buying mood will come back. So I believe the only way to cross the 10000 line between FOMO and FUD, correction and falling, is in the hands of whales, and depends on whether they want to push price under this line violently (violently as they did upwards, like knife through butter).
I can't tell you what the whales think. I just can tell you that I believe this is the state of things, and that 10000 is a very important line and it is worth to keep an eye on it.
This level is also very important from the perspective of technical analysis, based on many factors. About these aspects please read the posts of the traders who are professionals and experts, and post fantastically good ideas. I follow some of them, please check my follow list if interested.
DISCLAIMER:
This is no trading advice. This is just an essay about the possible psychology behind movements.
Thank you for reading!
Please leave a "like" if you enjoyed, or think it was useful.
I wish you luck and winnings!