What is the reason for today's 'waterfall'?

Have you noticed that in the past few days, there has been a sharp drop around five or six in the morning? Why is it always at this time?

Personally, I think this is the dealers clearing the long leverage. At this time in the morning, it’s five o'clock in Asia and midnight in Europe and America, when many people are resting, and almost no one can monitor the market in real time. The liquidation positions are usually quite far away, so the dealers make a quick drop followed by a rebound, not giving you any time to react or increase your position. Even if you see it, you won’t have time to act at that moment. This is the dealer's strategy. Now that they have achieved their goal, it gives us the illusion that the market will continue to drop.

Most people are shorting a certain coin today, fearing it will be like yesterday, where the market gives you time to recover during the day and then takes the opportunity to harvest again at night.

To summarize, the dealers' goal has been achieved, mainly to clear leverage, and we may welcome changes next month. Now that they have reached their objective, I personally believe there might be a rebound, though it’s hard to say when exactly. The market isn’t giving you time to see the trends; sudden spikes or drops leave you unable to respond. There shouldn’t be any major moves today; the dealers likely want to give retail investors some time to 'grow' a bit.

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