SERIOUS SHORT LIQUIDATIONS

One of the reasons Bitcoin breaks $21,000 for a very short was because short liquidation hit $175 million. Of course, some of these pumps are caused by natural buy pressure but much of the pump in a few days was caused by manipulations to the upside. Short traders were betting that the price of Bitcoin will go down instead the price goes up and they get liquidated, pushing the price higher. After a series of serious short liquidations, over 133,000 traders got liquidated. As of yesterday, total limitations stood in the 700 million with the largest single 24 liquidations of 6.8 million happening of the Huobi exchange platform and it wasn't just the short sellers for Bitcoin being liquidated, Ethereum had the must liquidation pushing the price up.

---

You might wonder why now we have this sudden pump after months of downside. It is reported that over 66% of the total BTC supply has been moved in the last year meaning much and much illiquid market. An illiquid market doesn't mean Bitcoin will suddenly shoot up or break down but it does mean when Bitcoin moves in either direction, it is going to be big and the market is easier for manipulators to manipulate. All markets are cycling, and there is always a sense of Euphoria at the top denial on the way down and panic and capitulation, and a period of no movement which is depression and disbelief.

---

If we match the Bitcoin rally over the cyclical, it is very interesting how similar the Bitcoin market seems to be. We are not sure whether we are in a disbelief state or maybe we still have a further downside. For us to understand the cyclical Bitcoin for year circle, we need to consider Bitcoin in 2015, 2019, and 2023 which are all two years after Bitcoin peaked. In BTC year-to-date RIY, we had an early capitulation event but we finished the year up. In 2019, we had sideways actions the year trended up. This was 2 years after the top, one year after the bear of 2018 but right now in 2023, the market is popping.

---

Of course, we know that past performance does not guarantee any means of future performance. The reason why I think it will stay the same this year is that Bitcoin does go through the 4 years circle, meaning it supply faucet mined in circulation is been cut in half every 4 years. This is why we would see something similar yet a big reason why we wouldn't is that Bitcoin has only known inflationary time and money in the system. Then in 2022, the first time the FED is actively trying to pull money out of circulation. They are raising rate aggressively, Bitcoin have never exited in this type of hawkishness for a long amount of time from the FED.

Reference