The cryptocurrency market is in a panic; people are scared and wondering what exactly is going on. It turns out that Tesla may have sold their Bitcoin holdings.
The charts are not looking good either; there are so many red candles; you can also notice the massive red candle from last week’s dip. The good news about last week’s massive red candle is that we bought close above the 21-week exponential moving average, which is an area which many traders are watching as a sign of support for a bull market continuation.
Unfortunately, the new week has begun with a red candle below the 21-week moving average; we only have about seven days for a turnaround to occur for recovery to come in and for a weekly candle to close above the 21-week moving average.
Bitcoin was down by over 30% from the top around sixty-five thousand dollars a few weeks ago; as a result of this, many people are bearing and are beginning to say that the bull market is over, and Bitcoin may go back to zero. The truth is that what we are currently experiencing in the market is not all that crazy; you only need to take a step back and have a proper understanding of the entire situation.
This current correction which is about 34% is the worst we have seen during the 2021 bull market; these kinds of corrections are very normal.
This kind of extreme market volatility can freak you out if you are new to the crypto market. The good thing is that despite all the fear and negativity, people who have been around for a while understand what is going on at the moment. This is not the period for you to panic and sell your crypto holdings, but this is the time for you to panic and buy crypto. These are great buying opportunities. Besides, this is not the first time we have extreme corrections like this; we have even had worse corrections several times.
It seems that Tesla may have sold their Bitcoin holdings based on a tweet Elon Musk replied to. The fact that they stopped accepting Bitcoin for payments shook the markets, and people started freaking out. If Tesla sold their Bitcoin, initially, when they came out and announced that they would not accept Bitcoin as payments, and did mention that they would be keeping the Bitcoin that they had as a strategic asset. Ever since then, Elon Musk has been attacked non-stop on Twitter.
People have failed to realize that the Tesla Bitcoin is worth about 0.2% of the entire market capitalization of Bitcoin. We do not know exactly how much Bitcoin Tesla purchased, but institutions have bought 215 thousand Bitcoin in the last thirty days. It is important to understand that Tesla is just one company; they do not make the market.
They are not holding 20% of the supply of Bitcoin; they are holding 0.2%. If Tesla sold their Bitcoin, the institutions waiting to buy it are ready.
