Coming after one of its best months in years, Bitcoin realized a steep correction which drove the price down below $8,000. As it's almost always the case with sharp and noteworthy BTC price movements, apprehensions of price manipulation didn't take long to surface.
Bitcoin Price Drops Down to Below $8,000
Bitcoin was trading relatively stable in and around the $8,500 range for several days. That being said, it certainly didn’t take much for the leading cryptocurrency to experience a significant correction.
As found in the above chart, the price went down all of a sudden within about an hour. The downtrend managed to wipe of about $13 billion off Bitcoin's total market cap. Not surprisingly, as it's almost always the case, the complete market followed.
Most of the leading altcoins are also trading in the red, as the market place saw in excess of $25 billion taken out of its capitalization.
The fact that Bitcoin Dominance, the index which determines its relative share in the total market, continued to be somewhat unchanged, shows us that altcoins were not capable in capitalizing on the reduction and also lost positions. BTC dominance at this time sits at about 55.8 percent.
Fears of Bitcoin Price Manipulation Double Down
Shortly before the unanticipated drop in Bitcoin's price, a significant amount of BTC was moved to Coinbase's exchange wallet from an unknown wallet. The transaction can be seen here. The total amount of 25,160 BTC, at the time of the drop, was actually worth about $215 million.
Certainly, for everybody following the crypto space, it's far from being the first time doubts of price manipulation are surfacing following a sharp movement. Back in April, when Bitcoin surged with more than $1,000 within a day, Reuters mentioned that the leg up has been triggered by nothing but a single algorithmic order of around 20,000 BTC executed among various exchanges.
There has been a single order that has been algorithmically-managed across these three venues, of around 20,000 BTC. […] If you look at the volumes on each of those three exchanges – there were in-concert, synchronized, units of volume of around 7,000 BTC in an hour.
A Healthy Correction Nevertheless?
Despite all of the fears and concerns mentioned above, some still believe that this most recent drop was a correction in line with what we needed to have. Furthermore, it doesn’t necessarily mean that Bitcoin’s uptrend is cracked either.
If you listen to and have faith in the analytical skills of veteran trader and popular commentator Peter Brandt, the correction followed a so-called “Doji top.”
Doji top on weekly chart begins correction. $BTC pic.twitter.com/9L9YCZbrP8
— Peter Brandt (@PeterLBrandt) June 4, 2019
What he talks about is a common trading term used to define the forming of a transitional candlestick which points out the indecision between bulls and bears. The Doji can also be observed as a continuation pattern where after the open, bulls tend to push the prices higher only for it to be rejected and pushed lower by the bears. Nevertheless, if that's the case, bears would not be able to keep the prices lower and the bulls tend to push them back higher. Assuming that Bitcoin manages to climb back up to the range around $8,500, this would be an endorsement of its formation.
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