Bitcoin price has recently seen a $ 2,000 correction after months of rising. At the start of the sale, signs of profit taking were cited as the primary reason for the pullback. However, after greed turned into fear, big money investors began to take blood from investors who panicked by damaging the cryptocurrency.
Here's the reason why it's so incredibly bullish for Bitcoin and what that means for a new uptrend.
Bitcoin Whales Buy Blood As Little Time Investors Sell Panic at Lost
The crypto market is on fire in 2020, and although other crypto assets have outperformed Bitcoin, it has done well for itself as well.
Bitcoin remains the most profitable main investment of the year alongside gold, stocks and everything else. But a recent collapse of over $ 2,000 has turned the ultra greedy market into a scary one.
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Contrary investment strategies suggest markets sell when greed is at its peak and then buy at the worst time. This strategy would have been proven in the last few weeks, when the crypto market Fear and Greed Index hit record highs.
As the green moving profit average below shows, the smart money earning profits initially caused investors to divest. But smart money may now be buying "blood on the street" in reverse. Baron Rothschild suggested.
Bitcoin Moving Profits and Losses | Source: Twitter
Profit-taking has turned into buying the fear and panic of those who can't control their emotions and sell their Bitcoins at loss – represented by the red line that recently crossed the green.
Notice that during each big crash, the investor is selling at loss rather than profit. Meanwhile, at every top, investors are making profits rather than panic dumping below entry.
But after such a big drop on Black Thursday and an ongoing bear market that has not yet resulted in a new high, why are investors still buying blood at such high prices?
BTCUSD Weekly S/R Flip | Source: TradingView
So Confident Are Crypto Bulls To Buy The Dip?
If the technical analysis patterns are correct, the bulls are right to buy the fall rather than sell at loss. Those who sell on the road can be very regretful and have to buy back at higher prices.
What gives confidence to smart money suddenly after taking profits recently is that the bearish resistance is turning support along with $ 10,000 and has remained strong over the daily and weekly time frames lately.
Related Reading | Has Bitcoin Approved Retesting of "Meme" Downtrend?
If the key level can be fixed in September as well, it could be just months away for a new bull market to fully develop and retest the all-time high.
Featured image from DepositPhotos, Charts from TradingView