{"id":464485,"date":"2021-05-26T06:02:00","date_gmt":"2021-05-26T06:02:00","guid":{"rendered":"https:\/\/wncen.com\/?p=464485"},"modified":"2021-05-26T06:14:22","modified_gmt":"2021-05-26T06:14:22","slug":"crypto-capital-manager-ethereum-and-bitcoin-selloff-was-a-bear-trap","status":"publish","type":"post","link":"https:\/\/wncen.com\/news\/crypto-capital-manager-ethereum-and-bitcoin-selloff-was-a-bear-trap\/","title":{"rendered":"Crypto Capital Manager: Ethereum and Bitcoin Selloff Was A \u201cBear Trap\u201d"},"content":{"rendered":"

Was the recent crypto crash bound to happen? Or was it engineered? Is the bull market over for good? Or is the market gaining momentum, preparing for big movements? Your guess is as good as ours, but Moonrock Capital\u2019s Simon Dedic is of the opinion that weak hands got their foot caught in a bear trap. Once again, they fell for a rich man\u2019s trick.<\/span><\/p>\n

Before we explore the case further, let\u2019s make sure we\u2019re on the same page by consulting <\/span>Investopedia<\/span><\/a>\u2019s description of what happens in a bear trap:<\/span><\/p>\n

To increase demand and get stock prices to rise, institutions might push prices lower so that the markets look bearish. This causes novice investors to sell stock. Once the stock drops, investors jump back into the market, and the stock prices rise with the increase in demand.<\/span><\/p><\/blockquote>\n

And let\u2019s read exactly what Dedic said:<\/span><\/p>\n

https:\/\/twitter.com\/scoinaldo\/status\/97785094<\/p>\n

So, were the sellers played?\u00a0 Let\u2019s find out.<\/span><\/p>\n

Where were we before this possible bear trap?<\/span><\/h2>\n
A mere month ago, Bitcoin was going through a long consolidation period and Ethereum was booming. The \u201c<\/span>flippening<\/span><\/a>\u201d narrative returned and all eyes were on the upcoming hard fork \u201cLondon,\u201d which will make ETH a deflationary asset.\u00a0 Then, the crypto crash happened. And of course, <\/span>NewsBTC reported it<\/span><\/a>:<\/span><\/p>\n
A week ago, Ethereum was riding high after hitting a new all-time high of $4.4k. Since then, ETH has been caught in a downtrend, with things getting much worse due to the crypto crash.<\/span>
\n<\/span>At one point, at the height of the panic selling, the price of Ethereum dipped as low as $1.9k before wicking back up. That\u2019s a 57% loss from its all-time high.<\/span><\/p><\/blockquote>\n
The situation doesn\u2019t look as hopeless at the moment. Ethereum is on an uptrend and each coin costs $2.813 at the time of writing.\u00a0<\/span>
\n $\"ETHUSD$ <\/p>\n
ETH price chart on Kraken | Source: ETH\/USD on TradingView.com<\/a><\/pre>\n
Where are Ethereum and Bitcoin right this minute?<\/span><\/h2>\n
The market looks healthy, even if it took a beating over the weekend. Both cryptocurrencies are slowly gaining traction at comparable speed. The ride feels stable now, and we all know what that means\u2026 surprises ahead. Coindesk<\/a> has Steven McClurg, CIO at Valkyrie Investments, predicting what these surprises might be:<\/span><\/p>\n
\u201cDue to the law of large numbers, it takes many more users today than it did a year ago to increase activity on the bitcoin network to the point it drives the price higher,\u201d said McClurg.\u00a0 \u201cETH is getting traction due to ETH 2.0 and those staking their assets to the network in anticipation of proof-of-stake, taking out supply as demand comes in.\u201d<\/span><\/p><\/blockquote>\n
Is he right? So far, stats and charts don\u2019t show it. In fact, the trends are at the exact same level as when our sister site <\/span>Bitcoinist called off the flippening<\/span><\/a>:<\/span><\/p>\n
Ethereum has still around 40% of Bitcoin\u2019s market cap. And the percentage is exactly the same if we compare the active nodes. It already surpassed BTC in everything that has to do with transactions, from quantity to fees generated. And ETH is not even close in Google search interest and active addresses.<\/span><\/p><\/blockquote>\n
Related Reading | TA: Ethereum Faces Hurdles, Here\u2019s What Could Trigger Strong Recovery<\/a><\/strong><\/em><\/p>\n
For a closer look at the stats, <\/span>check here<\/span><\/a>.<\/span>
\n $\"Bear$ <\/p>\n
The Flippening, Market Cap chart | Source: Blockchain Center<\/a><\/pre>\n
Did we fall into a bear trap, then?<\/span><\/h2>\n
If we did, we\u2019re still in there. So, we don\u2019t yet have the necessary perspective to make a call. Certain indicators point that way, though. For example, this crypto enthusiast seems to have identified a historical pattern:<\/span><\/p>\n
\n
#Bitcoin<\/a> Macro bull-cycles<\/p>\n
2011:
– Duration 9 Month\u2019s (after prev. ATH)
– Bear trap in Month #6<\/p>\n
2013:
– Duration 9 Month\u2019s
– Bear trap in Month #5<\/p>\n
2017:
– Duration 9 Month\u2019s
– Bear trap in Month 6<\/p>\n
2021 \/ Now: We\u2019re in Month #6<\/p>\n
— CryptoAmsterdam (@damskotrades) May 21, 2021<\/a><\/p><\/blockquote>\n