4 Reasons Bitcoin & Crypto is CRASHING.

ah hey everyone don't mind me

we gotta talk about the uh crypto crash

that's going on

there's a lot of stuff going on over

there

and uh in here as well but uh we gotta

talk

because there's a lot that's happening

okay here's the first thing that we know

active wallets folks active wallets one

of the problems that we're having right

now in bitcoin is active wallets which

is uh one one of the measures that we

can use to gauge trading activity has

stalled we hit 1.2 million actively

trading wallets uh about a year ago

today now we're down to 971 thousand

this means we're down uh just roughly 20

now because of this there are some

suggestions that we could set up a

liquidity squeeze that might cause

something very similar to the december

flash crash that we saw which we've been

seeing bitcoin fall pretty substantially

today let's go ahead and look at the

chart and then look at some of the other

reasons for a fall that we have because

we've got four really big ones the first

one though without a doubt the

plummeting in active wallets and the

amount of active accounts actually

buying the dip so in december we had

this substantial kind of flash crash

right here flash crash is really defined

as a sudden sell-off generally driven by

liquidations that's what we had on about

december 3rd that was a pretty bloody

friday in the stock market

and the way weeble kind of shows the

24-hour here it always seems to show it

the date about a day later uh but that

might be because they're using gmt time

but anyway what's important here

is that yes some form of liquidated

flash crash and then recovery which we

were covered within that same day i mean

we fell down to 42 383 and then within

the same day ended up closing at 49

800. it's a pretty substantial

difference there we were still down 9.25

that day

but certainly nowhere near as far down

as we were intraday and there are

concerns now that we could see that same

sort of wicking happening uh over the

next few days to a few weeks and part of

the reason for that is if crypto

continues to trend down whether that's

because of its correlation to the nasdaq

or some of the other reasons that we're

going to talk about

in this video it doesn't help when you

have a less actively trading wallets now

sometimes that's because people are

taking their cryptocurrency out of hot

wallets or brokerage accounts and

they're putting them into cold storage

which means they're not being actively

traded

which can sometimes be good if more

crypto is being locked up is essentially

a store of value than potentially you

have less selling pressure but

unfortunately the opposite is actually

happening right now at the same time as

having less overall traders and so

that's another issue that we face right

now so number one issue is a decline in

active wallets number two is a record

transfer of cryptocurrencies

specifically bitcoin from

cold storage to brokerage accounts we're

seeing a large transfer so this should

imply more trading but so far it seems

to be materializing as selling pressure

uh at least based on the current price

activity now another issue that we're

facing is reduced of volumes and open

interest in futures trading now some of

this could have to do with the same

reasons in terms of us seeing fewer

trading accounts in crypto but according

to the chicago mercantile exchange we

are down from an all-time high of 17.4

billion dollars of crypto futures

trading actually i'm sorry bitcoin

futures trading just bitcoin 17.4

billion dollars of bitcoin futures

trading in october which is just two and

a half months ago

and we are down to 10.6 billion that

represents a 39 drop in trading notice

how much of this is related to trading

and how little is actually really at

this point related to hodlers or diamond

handers it's really traders that make

the market and we've heard this before

that institutions trade uh 70 of the

crypto that's that that trades that

institutions are really the ones driving

price actions and if they need to hedge

against risky style assets and they need

to beta hedge one of the things they'll

do is they'll sell things that have uh

that have an elevated beta and

unfortunately tech stocks within the s p

500 have a high beta and the correlation

between bitcoin and tech stocks keeps

getting more and more clear so if hedge

funds are selling off tech stocks

because of what's happening with the

federal reserve federal reserve today

providing a completely disastrous

account

of what's happening in the economy

albeit that was about a three week old

meeting that we just reviewed or got the

minutes for today it's still weighing on

crypto as well

just to give you a very very sort of uh

brief synopsis of essentially what was

talked about

we had talked from the federal reserve

about having the largest balance sheet

ever high inflation more short-term

bonds than ever before risk to the

upside for inflation risks are the

downside for the economy and that

inflation is broadening and last week we

talked about how a cryptocurrency

specifically bitcoin is not at all

trading like an inflation hedge in fact

it's trading much more like a risk asset

or risk on asset or textile asset and we

saw this when we broke down the catalyst

last week of how crypto is moving in

relation to what sort of activity is

happening in the actual marketplace and

see you might remember this remember we

wrote what moves bitcoin well folks fear

about inflation going up and fear about

the federal reserve raising interest

rates moves bitcoin

down not up because what moves bitcoin

up is money printing without inflation

so a brief summary would be fed fears

and high inflation equals bad for crypto

lower inflation accommodated fed good

for crypto so that's just another one of

the reasons that we're facing right now

so so far we've got quite a few we've

got a decline in active wallets we've

got volumes and open interest declining

we've got more transfers from wallets to

brokerages

then we've got this correlation between

the fed fears nasdaq the technologies

all rotating to the downside

also hurting crypto and the last thing

that we've started seeing although this

is not i don't really want to call this

the fifth catalyst yet so that's why i'm

only really saying four but it's just

another one that we really have to pay

attention to is bitcoin liquidations in

the last 24 hours we've had over 500

million dollars worth of crypto

liquidations let's take a look here

actually now at 12 points actually

ticked up right now we're sitting at

total liquidations at over

740 million dollars of all kryptos if i

just sort to btc we're actually at 282

million of just btc liquidations

for ethereum liquidations we're at about

143 solana 17 17.9.71

xrp actually

16.7 so moving up a little bit jumping

to matic 7 mana

algo you can play with these here but if

we jump on over just to see this

graphically

we could scroll here and see this

elevated pane here in liquidations

and this generally is associated with a

decline in cryptocurrency prices so

these are a lot of issues that we're

facing right now all at the same time

decline in active trading wallets people

trading less maybe they have less money

to buy and go shopping we're seeing uh

futures volume decline remember bito

that was the bitcoin futures etf that

surged to one billion dollars in assets

under management within uh the first two

days of trading right now it's only at

1.2 billion so i guess i shouldn't say

only because that's still technically up

20 percent but it had most of its growth

the first two days and then just

sat there so decline in active wallets a

decline in uh futures trading an

increase in liquidations

fed fears all of these things combined

are creating a lot of fud in the

cryptocurrency market space to where

while you still have some analysts who

are like don't worry we're still going

to 100k

there are a lot of people who are

getting vocal coverage right now about

oh no don't worry sell your bitcoin now

because we're going down a lot further

before we go back up

now i don't know but let's take a look

at some of the technical analysis i will

say if we get a full break under where

we are now which is a line of about 45

seven we are potentially knocking on the

door of a 37 592 again that's the next

stop uh then of course we've got some

soft stops in the mid 30s uh the the red

lines here softer stops harder stop at

about 32 6 and then we get some strong

support lines on that 30 30 31 30 and

29.2 level uh for btc so hopefully

we don't have to trend in this direction

but uh right now we're definitely not uh

jumping up and down with the uh the fake

out rallies that we've been getting from

bitcoin uh multiple different fake outs

here to try to get us off of support and

this uh this fed meeting information was

really the nail in the coffin to help

push us over the edge to the downside

here ethereum now under 35 same sort of

break to the downside not great because

the next stop could be 25 100. we go

ahead and jump on over to uh aida ada

sitting at 122. next stop brings us

right back down to a buck look at this

how we're playing these support lines

almost perfectly take a look at this you

had your breakout uptrend got rejected

by that 150 and came right back down to

support uh it's uh i'll tell you basic

technical analysis or the kind of

information i teach in the stocks and

psychology of money course is extremely

critical when you are investing in

cryptocurrencies the same thing here

take a look at this you got uh you

bounced off of the 147 this is all in

the day chart you broke through 187

but got rejected at 206 only to come for

a brief landing at 171 and now solana is

rejecting right back down to about 147

again over and over and over again these

support lines which i don't move i leave

them stable only time i ever move them

is totally by accident but if you look

at my past videos you see they're always

consistently at the same spots ada

solana uh you know bitcoin ethereum

let's go ahead and take a look at matic

so uh here's matic don't have many lines

drawn for a matic but clearly a rotation

down here uh we we're still on an

uptrend uh i would say sort of a more

broad uptrend from the middle of

december here we could see that trending

uh nicely up here we are getting uh

higher lows which is good uh we're not

really seeing higher highs anymore we

were so we'll see what's happening you

know what ends up happening here if we

end up converging down and finding a new

support level but right now that's a

little difficult to determine exactly

where that might be

we could do a fibonacci retracement what

if we went ahead and did that and we

took a i'm going to go ahead and measure

from the floor that we had in september

this was really before the rally and it

kind of ignores all of the madness that

happened in the summer so if i go ahead

and draw down from a peak here on fib

and pull down to the bottom here

it looks like we're getting close to

bouncing off of that

197 line on matic we got stuck around

the 78.6 percent line at

2.52

but of course the next stop after this

if we end up do hitting that 197 level

could be 175.

so it gives you a little bit of

perspective into some of the drama

that's going on i think a lot of this is

uh well i mean ultimately it comes down

to what you believe as to whether or not

it's overblown or not what's happening

with the federal reserve if you believe

that the federal reserve has lost its

plot and inflation's going to the moon

you probably don't want to be in tech or

risk-based assets or quite frankly

crypto to some degree because it is

trading as a risk-based asset not an

inflation hedge if you believe that the

fed is overreacting and we're going to

see an inflection point to the downside

inflation and a return to some form of

accommodation from the federal reserve

even though technically we're still

accommodative right now uh that the fear

is that the fed's going to tighten

substantially

then uh then in that case maybe it's uh

these are all perfect opportunities to

buy the dip and hopefully you'll get

rewarded handsomely in the future if you

want to see all my moves make sure to

check out the stocks and psychology of

money course every time i buy or sell

something you get access check that

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