Why bitcoin falls below 19000? (worst is yet to come)

Bitcoin was sitting just above the magical 20 000 mark now as you might be aware the cryptocurrency markets never close they are open 24 7 365 days a year so through the weekend the bitcoin price has continued to come down and has now gone below the 20 000 mark and has carried on beyond that and has now dropped below 19000 and this is the first time since the end of 2020 that bitcoin has been down at this level and the other main cryptocurrency Ethereum has also gone through its floor level, it's now dropped below one thousand dollars, so we're seeing these cryptocurrencies falling to new level. Firstly I've got three questions that I'd like to run through with you as to why these cryptocurrencies are tumbling so badly and secondly, I've got a table which shows some listed companies in New York that have large bitcoin holdings and one of those is tesla, so we'll have a look what's going on with those holdings and obviously if these cryptocurrencies keep falling it's going to have a negative impact on those listed companies and so there's a potential that will have an impact on the Share prices for those businesses now as I said the crypto markets never close so as soon as I post this blog it's going to be out of date in terms of the current price but right now bitcoin is sitting at around eighteen thousand eight hundred and fifty dollars which represents a fall of around eight percent today sixteen percent over the last five days and more than 36 over the last two weeks, so this is absolutely the definition of a crash now  the key questions here are why is this happening and when will it stop where the bottom for this market in terms of why this is happening we've seen a major sell-off in a lot of financial markets over the last two weeks the news from the fed that they are now laser-focused on getting down the inflation rate in us and that they will keep increasing interest rates to getting there has sent shock waves through the markets we saw a 75 basis point hike in us, this week and that was the largest increase that we've seen for almost 30 years and at times like this any assets that require future growth in the economy starts to look less attractive and cryptocurrency is very much in that bracket so, we've seen a big sell-off in crypto but, I don't think anybody expected to see the rate of sell-off that we've seen and the falls in the prices that have happened over the last couple of weeks now in terms of where's the bottom of In this market, there are some very worrying indicators for cryptocurrency right now a lot of investors work on algorithms and charts and one of the metrics that they keep an eye on is the 200-week moving average so this looks at what the average price of bitcoin is over the last 200 weeks and that average is currently tracking at 19 804 so, bitcoin has now breached that 200-week moving average and that could now trigger a sell signal for all of those funds and investors who follow that moving average in addition to that it's been reported that a lot of institutional funds have been gearing up their position on bitcoin and that twenty thousand dollar price was the trigger point to sell for them to start exiting all of those positions so the fact that we've just moved through that position over the the course of  the weekend could mean that we start to see mass selloffs from the institutional side over the course of the next week or so and finally the the third factor here is the hedge funds as you'll know if you watch the recent In the blog that i posted about hedge funds have been set up to make money whether a the market is rising or falling so they don't just have to buy into positions and wait for it to increase in value if they think the value of an asset is going to fall then they can short that market and bitcoin is something that can be short so we don't have any data  just yet but there is a possibility that the hedge funds have seen this price starting to come down and that they've been shorting the market and as they've done that that drives the price down further and when you get a situation like that it's really difficult to stop that momentum now I don't have any data at the moment to prove that's happening but I do know that there are a lot of funds who are interested in cryptocurrency and if the price of cryptocurrency is going down you can bet that a lot of those funds are looking into ways that they can make money from a falling market this table shows the reported bitcoin holdings for 14 listed companies and the bitcoin valuation that this refers to is around 21 000 which is about 10 higher than where the market is right now obviously the most interesting the company on this list is tesla Elon musk is famously a big supporter of bitcoin and purchased 1.5 billion dollars worth of bitcoin in 2021 now for a while that looked like a genius move and tesla was sitting on a profit of more than 500 million dollars however over In the last six months the crypto markets have fallen and the position of tesla has started to turn sour and you can see here that the original investment of 1.5 billion was worth around 900 million and at today's valuation that holding is now worth closer to 800 million so tesla is now looking at an exchange loss of around 700 million dollars on this trade and if we look at the other companies on In this list we can see that at the time that it was produced four of the companies were sitting in a lost position with micro strategy sitting with a whopping 2.7 billion dollar loss however as I mentioned the current price is around 10 lower than it was when this table was produced so all of these companies are now looking at a significantly worse positions than they were here so what we're seeing in the crypto markets right now is a supercharged a version of what's happening in the other financial markets we're seeing the markets coming off and we're seeing daily losses but because the crypto markets never close they are constantly falling right now and they are falling at an accelerated rate and it'll be interesting to see what happens because if the hedge funds have locked onto crypto as something that they can start making a profit from whilst it's falling then we could see that market starting to tumble over the next week or so now when you have a situation like this, in the stock markets if you have one particular share that suddenly starts to tumble the key investors all rally together and usually there's some form of the plan put together but with bitcoin we don't have key investors it's a disparate group the whole point about bitcoin and crypto is that it's not controlled by one company or anyone individual, so we've got a really wide variety of holders and the problem you've got when a market is dropping so fast is that people start to lose confidence then everybody wants to get out before it's too late and that is potentially a situation that we could be looking at crypto we've already seen a couple of the platforms suspending withdrawals and it could be that we see a lot of other wallets are being closed over the next few days so it's going to be a really interesting week for the crypto markets so I wanted to post this video really to make sure that you're fully aware that the markets are still moving and they're still moving down and they've gone through a couple of triggers points that I think are sending warning signals to all holders and it'll be fascinating to see what happens over the course of the next few days.