When Crypto Chooses its own Path

It has become an exercise in futility in trying to understand the current market dynamics. When you think you can decipher how the market would react, it ends up doing the opposite. Crypto keeps reminding us that it only moves on its own rules. And that's exactly what the current market condition portends.

For a long time, the market was looking like a tired old woman whose legs can no longer hold her body standing upright. Neither bad news or good news make any difference, the market either goes down or stay flat. Things like rate cuts, institutional investors making headlines with their Bitcoin acquisitions, ETFS, and regulation clarity that should make positive effects didn't move anything.

Then we heard some rather unexpected news of a big geopolitical story involving the United States and Venezuela. The whole media carried the news, there were no major news outlets that didn't post it. Normally, news like these would make the market panic, this is the way it has been during global tension involving the world super powers. However, crypto surprised everyone and did the opposite. Instead of panic and dump, the market started showing strength.

Bitcoin began moving higher. Then Ethereum followed. The rest of the big coins began turning green. Suddenly, the market looked like it was alive. There was no big explosion, but just steady movements going higher, like the market was slowly waking up from a deep sleep. While the stock market was questionable and gold was stagnant, the crypto market began grinding higher.

That was confusing on its own.

We were bombarded with news for months that would have caused prices to increase, and nothing happened. But now, faced with a situation that appeared to be chaotic on the surface, the market adversely chose to exhibit strength, not fear. This was not consistent with the event, and that was what made it so intriguing.

Perhaps the market was ready for a move and just waiting for a reason to happen. Perhaps a long buildup had pushed the price down, with the accumulation occurring quietly in the background. Retail traders could have been devastated, but institutional and deep-pocketed traders could have been quietly amassing Bitcoin and Ethereum, ignoring what the headlines said.

But all this also points out an important truth about crypto psychology. The truth is that crypto can be very boring if the price is stagnant or declining. But as soon as Bitcoin begins to move, all that changes. Suddenly, timelines come back to life. Charts are not boring anymore; instead, they look thrilling. You regain confidence. You get to enjoy viewing green instead of red, and even a small portfolio does not feel insignificant again.

To actually watch a portfolio turn green, even temporary and ranging from 10 to 15 percent, has an effect on your psychology. It helps revitalize your faith. It reminds you of your motive for sticking around during the dull and painful times.

This type of market is also good for trade systems that work based on volume and activity. When there is growth in overall market prices, the overall returns improve automatically. The profitability becomes more stable, and the system performs better simply due to a stronger market.

The most puzzling thing about all of this is its timing. What prompted such a move now after all the disappointing times before this? Chaos instead of clarity to breed confidence?

That's where it's all confusing to me.

Perhaps that is indeed the biggest lesson. Crypto never waits for optimal conditions to happen. It acts on positioning readiness, on when the pressure is ready to be unleashed, and on when least anticipated opportunities arise. Before one even realizes why it is happening, it has already occurred.

At this point, crypto investors are wondering if what we are seeing now could be the start of something bigger, or another temporary move? Is altcoins season on the horizon, or is it another Bitcoin doing its thing?

Nobody really knows. Maybe it’s alright anyway.

What really matters here is that it’s been made aware that it’s clear that the markets are showing signs of strength once again when most people thought all hope was lost. Just that in itself speaks volumes. One of the things that crypto seems to do quite often is to make a move when people think it least expects to. This feels like one of those times.

Whether this move will continue or pause is not what is important at this moment, however, is a statement of the market to remind us once again that this market is unpredictable and still capable of surprising everyone when they least expect it.

Posted Using INLEO