At the time of the 519 major correction, Bitcoin fell from 43,000 US dollars to a minimum of 29,000 US dollars, a sharp drop of 13,000 US dollars, and a maximum drop of 30% in 24 hours.
With the dive of Bitcoin, other cryptocurrencies have followed suit, with a drop of more than 50%, and the price has been directly cut in half. The number of people who have liquidated their positions in 24 hours on the entire network exceeds 580,000, and the total liquidation amount is as high as 44.2 billion yuan. From the highest point to the lowest point, Bitcoin fell more than 50%, 520 Valentine's Day, the cryptocurrency gave everyone a 50% discount.
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Today's point of view
Regarding this decline, we have expected it. In many briefings in the past, we have told investors that Bitcoin has ushered in a short-term top, ushered in a daily line and a weekly line, but the decline The intensity and speed of the move exceeded the expectations of the entire market, and the market is always like this, beyond most people's imagination.
This is why we have repeatedly reminded investors in the past 145 and 147 briefings not to take the knife on the left side, to sacrifice a certain amount of profit for certainty, and to wait for the right side to buy bottoms. In the past, many investments When people consult us, we all remind everyone to wait for the right side. So far, this strategy has successfully protected the safety and value of investors’ assets.
In history, there were two recent crashes comparable to the 519 crash. On December 17, 2017 and March 12, 2020, one was the end of the bull market and the other was the beginning of the bull market. Whether it was the end of the former bull market or the beginning of the latter, in After bottoming out in the short term, digital currencies have seen a rise of more than 50%-100%. Whether this decline is the last straw that crushes hope or gives birth to hope out of despair is a question.
The main reason for this round of decline is the chain reaction caused by the liquidation of the decentralized financial platform. When a platform liquidates the collateral, the market price falls and leads to more liquidation. This is the principle of the 312 chain liquidation in 2020. It is consistent, it belongs to more kills and more, and the stampede of the bulls leads to a decline.
Last night, the lending platform LiquityProtocol was able to liquidate 606,000 Ethereum belonging to TRON founder Justin Sun, but then Justin Sun repaid $300 million so that the liquidation did not happen. He himself replied on Weibo: There was a bullet flying past his scalp, and his life was hanging by a thread, but he survived, and suggested that everyone stay away from leverage. On May 20, the DEFI platform had a total liquidation of 660 million U.S. dollars, and the normal daily liquidation amount is generally between 1 million U.S. dollars and 5 million U.S. dollars. In comparison, after the sharp drop on March 12 last year, MAKERDAO only liquidated about 21 million US dollars.
So fundamentally, this is a rapid decline caused by bulls stampeding, and it is the market’s liquidation of excessive leverage under the frenzy. If this is later confirmed by technology, then this decline is a rare 50% discount for Bitcoin. Preferential sale is a rare opportunity for investors.
Although this drop turned the entire market from panic to despair, from the perspective of the entire large-scale structure, the structure of buying on the third week still exists, but after despair is accompanied by the germination of hope, the market is expected to repeat what happened in 312 Many people have always said that if they can return to 312, they will definitely buy the bottom. Now that the market has given another chance, do those who have vowed to buy the bottom still have the courage to make a buying choice?
For investors who pursue safety, they can continue to implement the strategy on the right side, and then consider buying after the right side is completely stabilized. However, for investors who pursue income, a sharp drop is an opportunity to buy. 20-50% of the bottom-hunting position, buy at a price below 40,000, take a certain risk to pursue a greater rate of return. Even if the bull market is really over, the last struggle before the end of the bull market, that is, a sharp rebound of more than 50% after the decline, is enough for investors to obtain relatively generous returns.
In terms of the market value of Bitcoin, Bitcoin rebounded violently after falling below 40%, and the market value of Bitcoin quickly returned to 45%. Altcoins have performed well in the past period of time, but the sector has rotated back to Bitcoin , Investors who have been taught by the market will choose value investment and choose bitcoin that is resistant to falling, so funds will flow back to bitcoin, causing bitcoin to lead the market and even suck blood. Considering these factors, we recommend investors to buy bottom Try to choose Bitcoin as much as possible, and wait until the later plate rotation, and then perform the operation of swapping positions.
