BREAKING NEWS – Crypto Market loses 10% in 3 hours…Time to jump in?

Monday 11 January 2021, 8:23 AM AEST - 2 weeks ago

The cryptocurrency market has been going in a strong uptrend ever since the COVID-19 crash in March 2020. Most cryptocurrencies reached their lowest, only to start appreciating in value and rise in an extended uptrend. But on the 10th of January 2021, around 6pm GMT+1, the whole cryptocurrency market crashed more than 10%. What seems to be the reason for this sudden drop? Is it time to jump in or wait for further adjustments coming on the horizon?

Crypto market is taking a breather

So far, there isnt anything new in the crypto realm or even in the investing world. Whenever theres an extended uptrend, a price adjustment becomes due and inevitable. We discussed in a previous article when to ACTUALLY say that theres a market crash, because from the looks of what happened in the past 3 hours, it looks like:

  • A heavy profit-taking
  • A simple market breather

When the market goes up by 45%, a price adjustment of a merely 10% shouldnt be an issue, and the proof is that so far, prices are starting to recover already.

Fig.1 Crypto market cap 1-hour chart showing the sudden price adjustment – TradingView.com

Lets take a closer look at what happened in the last 3 hours and compare that to previous events:

  • The price of the total market cap dipped below the uptrend channel
  • When that happened, the price suddenly fell heavily and reached a consolidation area
  • Within that same hour, the price recovered and is on its way back up

This can mean one thing: Traders are watching that important uptrend channel that starts in 2021 and are taking short-term trades based on the above technicals.

What happens next and how to Manage Risk

  1. If prices successfully regain the uptrend channel territory, we can say that it was a short-lived price adjustment.
  2. If prices remain stagnant, it is a good sign of consolidation, in preparation for another price move, and buyers will surely enter the market
  3. If prices fail to regain their previous prices or even consolidate, then we might witness a short price adjustment of a few days. We say short because everyone will take advantage of that price adjustment and buy more, because the crypto market is projected to reach even hi ...

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