Why did it suddenly crash? You fight, and my wallet serves as fuel?
Although there seems to be no need for a reason for the market to crash,
objectively, these four reasons are mainly causing the turmoil:
1. International conflicts scare everyone into retreating
Israel and Iran are at war, and as soon as this news came out, everyone panicked. Because the risks of cryptocurrency are too high, everyone fears losing their money, quickly selling their Bitcoin and other coins to buy gold, a safer asset.
2. Futures trading creates a chain reaction
Many people use borrowed money to leverage when trading cryptocurrency (betting a small amount for a large gain), but when the market suddenly crashes, they can't even stop their losses in time. Platforms can only forcefully sell their coins to repay debts, and with a bunch of people selling at once, the price falls like an avalanche, getting faster and faster.
3. Prices rose too rapidly, technically unsustainable
Bitcoin previously surged to $111,000, like climbing stairs to the top, facing resistance. Technical indicators were also “screaming”: the stochastic relative strength index indicated that the market had overheated, just like a person running too fast needing to catch their breath, causing prices to naturally fall back.
4. Those who have made enough profit begin to withdraw
Recently, Bitcoin ETF funds have been extremely popular, with $164 million pouring in on June 11 alone, pushing the price directly to a new high. But once smart investors saw they had made enough profit, they hurriedly sold their coins to cash out. When everyone sells, the price inevitably drops.
Yesterday, there was a slight rebound when it fell to $106,000 - $107,000, but by dawn, it directly broke below $106,000.
It didn't normally break below $100,000. Next, we need to focus on whether $100,000 will hold, especially pay close attention to the support level of $98,000 - $102,000. If it can't be maintained, it might fall to $92,000 - $96,000.
