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ErikNL

Why did the price drop all of a sudden?

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I know you guys hate titles like this, but don't worry, I don't only want to know why the price drops because it's not m00n!

I want to give my lack of knowledge about the market a small boost by simple asking you; what - in your humble opinions - causes the price to drop 10% in such short amount of time, while it looked like XRP was the only coin being steady during yesterdays decrease? Could it simple be a chain reaction of stop-loss orders, someone that has shitloads of XRP that decides to sell, market manipulation, etc? I really wonder what can cause a sudden decrease in price (but as well vice versa).

Throw your knowledge to me!

Thanks and much appreciated :)

PS:  I see a similar subject on Reddit, but man I start hating that place. A critical view on life is not allowed there...

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Many people traded their BTC for XRP, set stoplosses too tight at about .47 and market tested where they get triggered. And then it is just an avalanche when market finds the soft spot. Many people just lost 5% - 10% of their stack and if went long with margin, perhaps everything

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2 minutes ago, P3T3RIS said:

Many people traded their BTC for XRP, set stoplosses too tight at about .47 and market tested where they get triggered. And then it is just an avalanche when market finds the soft spot. Many people just lost 5% - 10% of their stack and if went long with margin, perhaps everything

yep. many lost and a few scooped them all up. all those zerps transferred to new homes. 

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4 minutes ago, P3T3RIS said:

Many people traded their BTC for XRP, set stoplosses too tight at about .47 and market tested where they get triggered. And then it is just an avalanche when market finds the soft spot. Many people just lost 5% - 10% of their stack and if went long with margin, perhaps everything

These are the answers i'm looking for! Many thanks :)

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Setting tight stop losses in crypto....you might as well go to your local high street and start handing your money out.

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7 minutes ago, trubbleinmind said:

yep. many lost and a few scooped them all up. all those zerps transferred to new homes. 

Yeah, and those hands are NOT weak! I do not use margin, I do not loan to trade, I ONLY trade with my own funds. If you try to time the market, you become fishfood for whales. Buy on weakness, sell on strength, not the other way around although FOMO catches us all sometimes. Me too :clapping:

Best strategy IMO is to buy and hold, only sell at need, but even then only on strength and set buy orders instantly at level 1-5% lower and hope it autofills, trying to keep stack at decided level, and try to cumulate long term savings on XRP.

Edited by P3T3RIS

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3 minutes ago, Qasim_786 said:

Setting tight stop losses in crypto....you might as well go to your local high street and start handing your money out.

Then again it was probably all the btc peeps who transferred over in the past few days and had become accustomed to btc acting like a stable coin before this recent pummeling!

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3 minutes ago, Qasim_786 said:

Then again it was probably all the btc peeps who transferred over in the past few days and had become accustomed to btc acting like a stable coin before this recent pummeling!

Yes, all those long-winded and ponderous blogs and articles about Bitcoin's newly established stability seem rather sad at this point.

Hopefully this will be the death of POW and good riddance.

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we saw this happen on the BTC pair the other day. in certain schools of trading it's called a terminal shakeout, in others stop hunting - a chance for market makers to shake out the last weak hands at a price level to exhaust the supply before resuming the uptrend: 

943665014_ScreenShot2018-11-20at4_24_44AM.thumb.png.fd25a2809f13afea065aff60465daa1d.png

After wrecking a ton of positions at the 7665 satoshi level, the uptrend continued

hoping that's the case on the USD pair this morning. time will tell. 

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I approach the markets from a perspective of supply and demand. Price moves because of supply and demand. When supply exceeds demand (or the opposite), the imbalances makes the price move to an area where it's gonna be balanced again, meaning where the buy and sell orders are in an equilibrium. A sharp move like the one we just witnessed, in my humble opinion, is a reflect of that concept, mixed with some market manipulation. Sometimes, before huge moves happen in a direction, you'll see the price go in the opposite direction. An explanation to that phenomenon could be that in order to go up (for the sake of our example), the biggest market participants (the Big Boys i.e the FI's) will "shake the tree". They'll go in the opposite direction first in order to trigger all the stop orders (tight sell stops from the weak hands). The stops here are sells orders to get out of their position. Who are the weak hands selling to ? To the big boys, who are buying at the same time at a discount. On top of this, by "artificially" pushing the price lower in order to hit the liquidity pools, the Big Boys will make the uneducated bears think that the price is crashing for good : the little bears will be short selling, and they'll have no other choice but to cover (buy back) at higher prices when they'll understand that this was just a trick and that the price is actually going higher. 

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1 minute ago, Teva said:

I approach the markets from a perspective of supply and demand. Price moves because of supply and demand. When supply exceeds demand (or the opposite), the imbalances makes the price move to an area where it's gonna be balanced again, meaning where the buy and sell orders are in an equilibrium. A sharp move like the one we just witnessed, in my humble opinion, is a reflect of that concept, mixed with some market manipulation. Sometimes, before huge moves happen in a direction, you'll see the price go in the opposite direction. An explanation to that phenomenon could be that in order to go up (for the sake of our example), the biggest market participants (the Big Boys i.e the FI's) will "shake the tree". They'll go in the opposite direction first in order to trigger all the stop orders (tight sell stops from the weak hands). The stops here are sells orders to get out of their position. Who are the weak hands selling to ? To the big boys, who are buying at the same time at a discount. On top of this, by "artificially" pushing the price lower in order to hit the liquidity pools, the Big Boys will make the uneducated bears think that the price is crashing for good : the little bears will be short selling, and they'll have no other choice but to cover (buy back) at higher prices when they'll understand that this was just a trick and that the price is actually going higher. 

Setting up stop orders in crypto is a sure fire way to hair loss (or worse) Best to have the hands on the wheel at all times.

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1 minute ago, Qasim_786 said:

Then again it was probably all the btc peeps who transferred over in the past few days and had become accustomed to btc acting like a stable coin before this recent pummeling!

Possibly! But truth is they could have been wrong or you can be wrong, that is irrelevant in trading. You either lose or you win, there are no positions in-between, and only afterwards you can speculate what caused it, if it caused it, and why did it cause it, and could it had been avoided... Too many variables

When trading, first thing to do is ZOOM OUT! Open weekly chart and forget about the short timeframes totally. Nothing under 3 hours is relevant, EVER, unless you want to trade/ have open SHORT-TERM orders while you sleep! 30 min chart goes from oversold to overbought in 3-6 hours, 1 hour chart in 6 - 12 hours and 3 hour chart in approx 20-30 hours. If you try to time the market, you become fishfood.

Weekly chart gives you an idea of the overall direction of the market, that is most important to understand. Are we in a bull market or in a bear market.

Daily chart gives you basis for real action. If we are on bull market, try to time your buys for example when STOCH RSI goes to oversold and crosses back up, estimate where it could climb and set your sell orders accordingly. If your orders get filled, spend some time to analyse everything regarding that. Did I sell all or part, at what price, too high or too low etc... Just think before doing anything. Start small and learn about indicators while you play the game.

Forget the shorter timeframes and do this for some time, and then you will understand that sometimes there is no way to understand how market behaves :dash1:

 

I know, very simplified explanation, but just wanted to write this because I hate to see people losing money because they overreact to drops and moons.

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22 minutes ago, Tinyaccount said:

They should NOT be called stop loss.  They should be called Create Loss.

The number of times they save a loss seems less than the number of times they lock in a loss during a temporary drop.

Its speculated that Whales and their VIP accounts can see others stop loss. I.e are able to manipulate the marked to reach that target.

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