Why Crypto ACTUALLY Crashed.

hey everyone me kevin here this video is

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let's talk about the stressful roller

coaster that is cryptocurrency or the

beautiful by the dip opportunities that

you get with cryptocurrency in this

video i'm going to break down what i

think caused today's a crash in

cryptocurrency and i'm going to talk

about what this means for the potential

future of crypto and catalyst that we

have coming up so let's first get

started there's a lot of talk

specifically fud fear uncertainty and

doubt over the fact that oh no

bitcoin was rolled out as a legal tender

in el salvador and was met with uh anger

from the population that 70 to 80

percent of individuals in el salvador

don't want this bitcoin as a currency

and that because of a botched technical

rollout bitcoin was sold off and that's

why bitcoin is down 10 to 17 today as

sort of a protest to oh no the potential

failure of bitcoin well in my opinion

this literally has nothing to do with

the fall of cryptocurrency prices in

fact we have to think about it this way

most cryptos fell on average about 10

today the broader crypto market lost

about 200 billion dollars of market cap

worldwide 200 billion dollars

worldwide is not an impact that we get

from el salvador

having a botched rollout

of bitcoin given the fact that el

salvador's total gdp for a year

is one-tenth okay maybe it's like

one-ninth of that it's 27 billion

dollars i don't think el salvador's

economy has the power to eradicate 200

billion dollars of market cap from the

crypto ecosystem and crypto economy so

i'm not so worried about el salvador i

think there's something else that

happened here and it's worth paying

attention to because it might be a

reason to buy the dip

unless of course you listen to bloomberg

let's start with that let's start with

bloomberg bloomberg threw out this piece

of technical analysis today bloomberg

suggested that bitcoin has now completed

a key day reversal paving the way for a

deeper correction all right so let's

break this apart so i've made the claim

that el salvador is not what led crypto

to fall

crypto fell anyway we're going to talk

about why but now we have bloomberg and

the bloomberg terminal arguing that wait

a minute is this the potential path back

down to 43 000 for bitcoin we'll analyze

that when we go to the charts in just a

moment but take a look at their argument

here believe them or not take a look at

this a key day reversal is essentially

when you hit a new high which we did

this is a new high right here following

yesterday's high right here so

yesterday's high is kind of right here

at the little tip there and today's high

is right here that's a new recent high

but in the same day right here we hit a

new high

and ended up closing below the low of

yesterday's price

and this right here is a potential

indicator per bloomberg of a reversal in

the crypto trend going up and a

potential indicator of more pain to come

this is really interesting because we've

got a very big catalyst coming up on

september wait for it is it the 13th or

the 14th the 14th the september 14th we

get the cpi data release coming up now i

know that many people do not believe the

cpi that's okay but we've got to know

that over 70 of cryptocurrency trading

is done by institutions and institutions

read the cpi they trade based on what

cpi does we know that most activity is

not people like you and me wanting to

buy and huddle or buy and then sell once

we make a nice game it's day trading

institutions folks taking advantage with

their computers of micro price

discrepancies and fluctuations between

lows and highs this is why

cryptocurrencies so clearly follow

perfect ta trends which because crypto

tends to follow ta trends so well

it is worth paying a little bit a little

bit not a lot i'm not putting too much

credit on this it is worth paying a

little bit of homage to

the potential warning of what the

bloomberg terminal tells us here now i

generally don't believe the terminal

here when they come when it comes to

their cryptocurrency expectations but

let me put it this way

last month i posted a video saying hey

we're at some of the lowest levels of

leverage and don't get me wrong still

leveraging the system but we're at some

of the lowest levels of crypto leverage

that we have seen

in in the last 12 months which is

incredible because we've had this crazy

run-up of leverage we've had this

collapse of leverage following the

sell-offs around april 12th and may 13th

that led cryptocurrencies to fall

throughout the summer we've seen a lot

of leverage come down we've slowly

started seeing leverage come back in and

when we saw this inflection point in

leverage in fairness shout out to

bloomberg they mentioned while ethereum

was like thirty one hundred dollars hey

you know we could actually see a lot of

gains coming to cryptocurrencies because

we still haven't seen the leverage

button really turn on in big levels yet

we're still at relatively small levels

of leverage and that in bloomberg's

opinion led them to believe that bitcoin

actually has a path to 100 000 which is

really interesting so they were kind of

right on about that

so

we also know that cryptocurrencies

follow ta trends and this is an

interesting piece of ta that could

potentially set the stage for a reversal

it makes sense we've had a pretty good

last 30 days here in crypto and we're

going to go to the charts in just a

moment but

we've got to look at what i think

actually led to potentially the start of

this reversal today maybe somebody saw

some of these indicators and what i

believe really accelerated the decline

that we happened or had happened today

the big thing in my opinion that really

added fuel to the fire today was of the

leverage we had we got a lot of

liquidations today so take a look at

this quick note before we do that i just

want to take a quick moment to mention

that yes

i have had so many requests from people

asking me to

not raise the prices yet of the courses

because they're waiting to see what

happens with my election they're waiting

to buy my programs to see am i going to

be governor of california or not and so

if i lose i say they want to buy the

courses which is kind of a really

interesting place i put in but anyway

what i've done is i've extended the

coupon code

for jack's birthday to september 24th

that gives us time after the election

for you to use that same pricing so

check that out down below you get all of

my buy sell alerts so if crypto's

falling and i'm buying you'll get an

alert just like we did this morning when

cardano ethereum and bitcoin were

plummeting check that out link down

below stocks and psychology of money and

we'll see you there so take a look at

this this is bipt

bybt and they give you a section where

you can look up total liquidations for

cryptocurrencies uh all of them uh or

you could sort them down by a time by

symbol by exchange whatever and take a

look at this these are sort of the

regular cryptocurrency fluctuations here

of liquidations these larger lines over

here mean how many liquidations we had

and so on a normal day you might see

somewhere between 40 to

400 million dollars worth of

cryptocurrency fl

liquidations essentially and this right

here goes back to june so you're kind of

seeing cryptocurrencies at low prices

here you can see when we have these

peaks over here sometimes you get prices

that fall down with these you get

liquidations here at the peak all of a

sudden you get this acceleration of a

decline which

the timing of which usually the

liquidations help you see the chart go

down right so all of a sudden you see a

decline of say 15 20 percent some folks

who are heavily leveraged start getting

liquidated and it sort of sets off a

chain reaction so take a look at this

here on the right side

look at this liquidation chain right

here a massive set of liquidations of

long positions around

almost 3.25

billion

dollars of bitcoin liquidations and when

we zoom in to see the time frame of this

look at this let's go into the one

minute chart here and really zoom into

this the one minute chart here we see oh

here's a big bar the evening around 8

p.m california time on september 7th

okay somebody got liquidated some people

got liquidated to the tune of somewhere

around 63 million dollars nobody cares

about that 63 million dollars we're not

even gonna notice that we gotta zoom out

a little bit more to eight a.m right

here in the span of one bar

in other words a 30 minute time frame

right here we had 1.82

billion in liquidations preceded by 700

million and 131 million and followed by

another 38 million so all of a sudden

within the span right here of 30 minutes

particularly between

806 a.m california time and 8 11 we had

a massive amounts of crypto liquidations

remember what a crypto liquidation is a

crypto liquidation is when prices fall

and all of a sudden brokers wake up in

the morning and they're like hey

it's 8am

pay up oh you didn't fund computer

automatically liquidates you at a

certain time usually what happens is if

prices fall to let's say i'm just gonna

make a quick example okay let's say you

have a hundred dollars in bitcoin and

you borrowed a hundred dollars against

it well you're not gonna be able to

borrow a hundred dollars so let's do a

better analogy let's say you have 100 in

crypto and they let you borrow 50. and

if crypto goes to 80 you get a warning

letter that's like hey you need to bring

in some more money like now now you're

in this place where it's too risky we

don't want to lose money and if crypto

goes to 70 or like the value of your 100

crypto goes to 70

then and i'm oversimplifying here then

you might get automatically sold out and

that's what i expected happened here we

started having some new money leverage

get into cryptocurrencies to start

really giving us that push right between

fifty thousand and fifty two thousand

this is where we started really getting

the push oh it's fifty three thousand

wow we're doing great again we're doing

great all right let's go over here look

at the weeble watch this here we are

we're on btc

let's go to the hour chart this is

here's our crash right here look at this

this right here

coming off of the 46 500 line this could

have a lot of this could have been

leveraged leverage leverage leverage

boom we're plowing in leveraged leverage

these extra peaks here leverage leverage

get in and all of a sudden look at what

it took it took a little bit of

potentially a whale selling over here

which is kind of crazy to think you get

a whale selling right here at like 2 a.m

all of a sudden notices go out hey you

need to pay up by 8 a.m or something

that effect and all of a sudden we get

to that 8 o'clock hour you go to the

minute chart look at this it's crazy you

go to the minute chart there it is

and you zoom into this

you can clearly see right here at 806

boom boom boom boom boom

five minutes of he double hockey sticks

in the crypto market

and this in my opinion well we know it's

not just my opinion based on the chart

this is the 30 minute period of time

where we had massive liquidations in the

billions of dollars of liquidations

and so now what does that mean well it

actually means a good thing we've now

cleansed the system

of some leverage that honestly probably

was responsible for pumping crypto to

the price that we've seen more recently

here let's uh let's go to the hour chart

it's a little bit simpler to view so we

go to the hour chart here in my opinion

this section right here could have been

heavily leveraged potentially because

traders were expecting us to go to the

54 000 line

well once we got those liquidations we

quickly reverted right back to where we

are before we were before having

leverage it's also worth noting that

when bloomberg reported hey there's

pretty low leverage in cryptocurrencies

right now that was about a month ago so

let's zoom out to about a month ago

which would be about the beginning of

august beginning of august right here

look at that folks same pricing 44 to 46

000

that's pretty crazy so uh these these

are important things in my opinion to

know is that this sell-off that we had

was not something fundamental it wasn't

something that said oh my gosh bitcoins

bad uh oh el salvador with the 27

billion dollar gdp big freaking deal you

know one-ninth of the market value we

lost in crypto today just the market

value of what we lost today right i mean

20 27 billion dollars relative to the

united states that's like gosh i can't

even do that math that's 10 20 that's 10

100 that's a thousand

we're a thousand times the size of their

economy america that is the united

states about you know we're in the 21 22

trillion dollar gdp range there are 27

billion it's tiny right 10 times 100

times a thousand times gets you it

around that 27 so roughly okay maybe

like 800

x but when you compare it like that who

cares about

el salvador's botched rollout of crypto

it doesn't freaking matter

what happened here is we had a leverage

push and a liquidation event because

people got a little too antsy probably

institutions i don't think a lot of this

was uh individuals maybe it could have

been people got a little too excited

that that's it this is the crypto bull

run and all of a sudden we get this

instantaneous almost reversal here

thanks to liquidations nope no no this

is a lesson stay away from debt but look

at this we immediately went in right

back to crypto technicals look at how

this oscillated between our channel here

i have a channel drawn at forty six

thousand seven hundred forty seven

thousand one hundred sixty five i've not

modified these channels probably in

three or four months the fact that the

vast majority of the price action

happened within that channel shows you

crypto is all about ta and the

technicals and it's very very possible

that we had institutions concerned about

cpi and the cpi data release coming up

institutions were also off over the

weekend these commercial institutions

sure their algorithms might be trading

over the weekend but i personally don't

believe the institutions

are coming in over a weekend like oh

yeah let's uh let's go uh you know work

on some new ta for for selling our

crypto it makes sense to me that

institutions potentially sold in the

morning hours here and started this

downtrend we really started seeing this

downtrend go go again to the hour chart

over here look at the hour chart when we

started seeing the downtrend started

seeing the downtrend 5 a.m

eastern time this is right around the

time you get a lot of traders on east

coast waking up east coast stock brokers

hedge funds getting ready

then your midday over here you see this

sell down and you get the big

liquidations at 8 a.m california time

start a business day after holiday

weekend uh you know middle right before

lunch

on uh on uh you know essentially a

monday of a week on east coast time

frame makes sense to me this was trader

driven

maybe who knows it could have slightly

been by the rumor sell the news i really

don't expect that i think this was more

cpi prep because i personally believe

that the cpi is going to miss

big

and we know that at least 48 of you who

watch this channel and follow me on

twitter are investing in crypto as an

inflation hedge and if cpi comes in low

even though we might not believe the cpi

it's possible that institutions are

trying to pre-trade this now

where do we go from here and this is the

important thing where we go from here

well based on bloomberg bloomberg has a

support line drawn at 43 900. now i

don't have a support line drawn there

that's right here so i'm going to go

zoom out a little bit and see if i can

try to figure out what they're seeing at

43 900. it's about right here okay i

could see that see that's the bottom

that we have right here in august we've

touched a few times it's a top we had at

the beginning of august you go a little

bit further it's been a bottom before

over here in february so we we have seen

some precedent for a 43 900.

bloomberg is suggesting right now

that we could see a reversal of crypto

to 43

uh 900 that is bitcoin

i personally

am excited to buy the tip i a pers oh

look at this

we just had another drawdown here yeah

look at this this just happened as i was

filming here that's funny yeah i've been

filming we've been working on this or

i've been working on this for like the

last 30 minutes or so we just had

another little sell down here

very interesting we've now broken out of

the channel i personally find these by

the dip opportunities i'm not buying

super heavy though because i am a little

bit nervous about that cpi release and

if we get a cryptocurrency run between

now and september 14th i might be

tempted to sell

right before like minutes before that

cpi reading comes out on the 14th which

would be at 5 30 a.m california time so

like 5 29

it's a potential temptation that i have

so if you're if you've got money at a

place where it's going to be expensive

for you to sell like block fi or

whatever and you want to transfer it

over to something else maybe consider

doing that sooner but anyway these are

some thoughts that i have

long run though very bullish 20 bitcoin

somewhere around 40 percent ethereum 40

cardano these are the big three that i'm

investing in excited about those i did

open a position in hud 8 today and if we

get a little bit more of a drop in in

bitcoin prices and hud 8 comes under

some more pressure happy to add to the

position these are just some of my

thoughts on bitcoin's pricing what

actually happened today liquidation

event and potential preparation before

cpi data release

and

what bloomberg's kind of suggesting

might be a little bit of a short-term

selling season that we have coming up

and for me buying the dip opportunity so

anyway thanks for watching check out the

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buy sell alerts make sure to get your

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and folks see in the next video thanks

for watching bye

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