- Bitcoin experienced a $331 Darth Maul candle last night
- Price pushed out of the wedge before dropping back beneath it and finally settled where it had been
- Longs and shorts were liquidated in this highly manipulative move
Bitcoin remained in its three-month wedge after a Darth Maul candle wreaked havoc with margin traders last night, landing it right back in the wedge after threatening to break out to $10,000 and then dump below $9,560. The move, which has the ability to trick margin longs and shorts in one fell swoop, leaves Bitcoin holders no better or worse off, and is a reminder of just how manipulated the cryptocurrency markets are.
Darth Maul Strikes Again
Bitcoin has been largely trapped in this wedge since it crashed to $3,850 in early March, spending over three months gradually recovering its price, attempting one or two breakouts on the way up:
On each occasion that Bitcoin has threatened to break out of the wedge it has been dragged right back in, most notably last Monday when it raced to $10,400 before falling back to $9,150 just hours later. It has since flirted with the trendline but never broken out convincingly, and last night saw more of the same – Bitcoin rose to $9,897 in just over an hour, convincing many to go long through the $10,000 barrier, before it crashed $331 in the space of five minutes.
This dump took it below the lower trendline, causing many more to short to further lows, only to see it shoot right back up to $9,730, trapping them too:
This is far from the first time we have seen this pattern, and it shows once again just how much price manipulation goes on in the cryptocurrency, and why margin trading can be a dangerous, dangerous game.
No Better Off
Last night’s move leaves Bitcoin no better or worse off than before the move. It is almost exactly where it was before the Darth Maul candle, still edging towards the very tip of a huge wedge. Our in-house analyst, Will Gambit of Cryptotraders.io, stated yesterday that he was bullish of a further move up towards the high range of $9,909, and indeed on the BitMEX chart he was only $10 off, but the fact that Bitcoin couldn’t sustain it suggests that either this isn’t the move he had in mind or that Bitcoin isn’t yet ready to make up its mind.
If the last week has taught us anything however, it is that when it does finally move it will be explosive.