Bitcoin Price Dump Example
Did you heard this statement: “Without warning Bitcoin just dumped”? These are words spoken by traders and analysts when looking at Bitcoin's daily price chart candlesticks on March 12, 2022. Our research indicates that using hourly price chart candlesticks can be exceptionally valuable when conducting Bitcoin price analysis. This is clearly illustrated on the next chart. The hourly chart was already showing a clear downward trend for Bitcoin.
This is the BTC/USD price chart from Mar7th thru 12th with 1-hour candlesticks. The QC Trend algorithm turned bearish based on the price movement, from a price of ~$9,200 to $8,800. This decrease would prove to be just a small percentage of the upcoming price drop to $3,978. The heavy volume and lack of liquidity caused the Bitmex exchange to go down during the price dump. This is a clear example of a liquidity crash. The Bitcoin price rebounds 15 minutes later to $5,743 when liquidity was restored.
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