May 19, 2021
Everyone was shocked how the crypto market crashed making almost all coins dip -50% above. It was sudden like in a blink seeing the candles went down straight with a long line.
There is some news circulating the crypto space that was the reason to create FUD (fear, uncertainty & doubt) and causes panic selling, shaking weak hands of the newbie investors and traders.
News that creates FUD and caused panic selling
Elon Musk Tweets
The very first news that creates FUD was caused by Elon Musk (Tesla &SpaceX CEO). This man tweeted that Tesla will no longer accept Bitcoin as payment due to the worst emissions of fuel that may harm the environment.
This made Bitcoin holders panic selling.
After that, Elon still keeps on tweeting then he replied to a podcaster telling him that Bitcoin is centralized and not decentralized anymore. The thread went viral and that creates another panic selling.
Source: Elon Musk Twitter
China To Ban Crypto
The market was in swing after the dump. Then last May 18 nighttime in our timezone, a news was out that China will ban crypto.
China did not recognize cryptocurrency as legal tender and last Sept.2017 China also banned Initial Coin Offerings (ICO's). It also prohibits crypto trading platforms to offer fiat/crypto conversion features. This made led the number of trading platforms and exchanges to shut down and moved offshore.
China elaborates its existing ban on banks and payment companies, banning any savings and trust or any pledge in crypto.
The crypto bull run has largely been fueled by overseas exchanges such as Houbi and OKEx. As a result of this enhanced ban, Chinese individuals will have a hard time buying and selling crypto.
Source: Cryptodaily.co.uk
This news made a huge impact on the crypto market and plummeted Bitcoin down to $30,000 and the rest was also down above 50% as it creates more FUD to all crypto holders.
Bitcoin repeat the March 2020 correction
Seeing the market crashed, did not only happens today (May 19, 2021) it also happens last March 2020 and June 2017.
With $30,000 low, its current correction amounted to a 53.74% drop. The decrease occurred in 35 days.
This correction is closely similar in both magnitude and length in March 2020 when BTC declined by 64% in 28 days. That made a low price of $3, 783. Afterward, it was followed by a V-shaped recovery that leads to the current bull run.
On the other hand, December 2017 correction was very similar in length that is 70% which took 56 days to occur.
So, the current correction is more identical to March 2020 compared to December 2017.
The recovery might follow the same path if the price manages to close above 0.5 Fib retracement at $34,375 level.
The BTC price shrank today to $30,000, which is a validated area as support. If it managed to close the daily candle at the $34,375 level then it could be a sign of bullish momentum leaving along with wicks in a candle.
Source: beincrypto.com
(The daily candle of May 19, 2021 did close at $36, 690.08. The Market tried to recover and battled to reach $42, 451.66. Let's wait how the market behave in the next few days because new FUD news is circulating again which is US Treasury called $Bitcoin transfers over $10k will be reported to IRS (Internal Revenue Service) that will be effective in 2023. The strong support for BTC is $38,000, let's see if it close the daily above that and market is still bullish.)
Source:beincrypto.com
Closing Thoughts
It was my first time seeing a sudden crash in the crypto market since I just entered here last June 2020, so I did not witness that March 2020 correction.
So, in the crypto market crash is just a normal thing as we all know crypto is volatile.
Let's just hold and keep calm, if you cant hold them you won't be rich according to CZ of Binance Exchange!
P.S thank you @Glez for my foot header image!
I am glad to read your creative article. Yeah, it's just a correction. What I learned from your article is to hold BCH for future. So, I need to stay calm..
Thanks for your quality article.👍👍