Market Structure (Lower Highs & Lower Lows) → Simple Definition: The direction of the trend based on the “staircase” of price moves. The Concept: In a healthy uptrend, price makes a High, drops slightly (Higher Low), then pushes up to a new High (Higher High). In the Article: The author points out “Lower Highs and Lower Lows.” Example: Bitcoin tried to reach $110k but failed (Lower High). Then it dropped below $84k (Lower Low). This suggests the staircase is now going down. Visual: Imagine walking down a mountain. Every peak you look back at is lower than the one before it.
Liquidity & Market Depth → Simple Definition: How “thick” the list of buyers and sellers is. The Concept: Deep Market: Lots of buyers/sellers. You can sell $10 million worth of Bitcoin, and the price barely moves because there are plenty of buyers to absorb it. Thin/Shallow Market: Very few buyers. If you sell $10 million, you might clear out all the buyers at the current price and have to sell to buyers at much lower prices, causing the price to crash. In the Article: “A $10M order can move markets significantly.” This means the “buffer” is gone. The market is fragile because the “order book” is empty.
Sentiment (Euphoria vs. Disbelief) → Simple Definition: The emotional cycle of an investor. The Stages: Euphoria: “I’m a genius! Bitcoin is going to infinity!” (Usually happens at the top). Disbelief: “This drop can’t be real. It will bounce back any second.” (Happens when the trend changes). Capitulation: “I give up. Just get me out.” (Usually happens at the bottom). In the Article: The author argues traders are currently in Disbelief—they think this is just a dip, but the author believes it is actually a crash.
Risk-On vs. Risk-Off → Simple Definition: The global “mood” regarding money. Risk-On: Investors feel safe. They buy “risky” things like Tech Stocks and Crypto. Risk-Off: Investors feel scared. They sell risky things and buy “safe” things like Gold, US Dollars, or Government Bonds. In the Article: The market has shifted to Risk-Off. Investors are selling Bitcoin (risky) and buying Gold (safe haven).
Contagion Vector → Simple Definition: A “financial virus” that spreads from one specific company to the whole market. The Concept: If a major player falls, they might drag everyone else down with them because they are interconnected. In the Article: MicroStrategy is the contagion vector. The Scenario: MicroStrategy holds billions in Bitcoin. If they get kicked out of major stock indexes (like the S&P or MSCI), investment funds will be forced to sell MicroStrategy stock. If MicroStrategy stock crashes, it scares Bitcoin investors, causing Bitcoin to crash. It’s a chain reaction.
Deleveraging (Unwinds) → Simple Definition: The process of paying back debts and closing “betting” accounts. The Context: In a boom, people borrow money to bet (Leverage). When prices drop, they must sell to pay back the loans. In the Article: “Futures Market Unwinds” means traders are closing their bets and taking their chips off the table, reducing the total money in the system.
“The market topped” / “topping structure” → Meaning: Price has likely made a major high for this cycle and failed to go higher. The uptrend is ending. Example: Bitcoin went near $126K, tried several times to go back above $105K–$110K, but failed each time and then fell into the low $80Ks. That pattern (failing at the top and then breaking down) is what people call a topping structure.
From Euphoria to Disbelief → Euphoria: Everyone is extremely bullish, confident that price will keep going up, “this time is different.” Disbelief: After the crash, people say “No way, this is just a dip, the bull market is still fine,” even though the structure is broken. Example: At $120K–$126K: Twitter full of “BTC 200K soon!” → euphoria; At $82K–$86K: People say “Relax, this is only a dip, buy the dip” → disbelief, even though price is making lower highs.
Bull Market vs Bear Market → Bull market: General uptrend over months/years. Higher highs and higher lows. Bear market: General downtrend. Lower highs and lower lows. Example: The author says: “This is the early stage of a bear market — not a continuation of the bull.” That means they believe the big uptrend is finished and now we enter a longer period of weakness.
Lower Highs and Lower Lows → Meaning: Lower high: Each new peak is lower than the previous peak. Lower low: Each new low is lower than the previous low. Together → downtrend. Example: First high: $126K; Next high: $110K; Next high: $105K; These are lower highs. Lows also go from $100K → $90K → $82K → lower lows. This is classic bear market structure.
Post-top structure → Meaning: The typical pattern after a big top: slow grinding down, failed rallies, liquidity drying up. Example: The author says this isn’t a sudden crash; it’s a slow breakdown after the peak. That’s a “post-top” phase.
Liquidity Decay / Liquidity Collapse → Meaning: The market becomes harder to trade in big size because there are fewer buyers and sellers at each price. Example: Before: a $10M order might move BTC only $50. Now: a $10M order might move BTC hundreds of dollars. That’s liquidity decay.
Market Depth → Meaning: How much buy and sell volume is available close to the current price in the order book. Example: If at prices around $85K there’s a lot of buy and sell orders, depth is good. The article says “declining market depth” → fewer resting orders → easier for price to move sharply.
Order Book is Shallow → Meaning: There aren’t many orders waiting to buy or sell at nearby prices. Example: If you look at the exchange’s order book and see only small amounts on each level, that’s a shallow order book. A single big trade can move price a lot.
Market Makers → Meaning: Professional traders or firms that constantly place buy and sell orders to keep the market liquid. Example: When market makers are active, spreads are small, depth is strong, and it’s easy to enter/exit.
Article says: “Market makers haven’t returned” → less depth, more slippage, more volatility.
Liquidity Clusters / Liquidity Pools → Meaning: Price zones with a lot of pending orders (stop-losses, take-profits, big limit orders). Example: The band $105K–$110K is called a major “liquidity band” because: Many traders have orders there; Many liquidations can trigger there. So price often “fights” around these areas.
Stop-Loss Clusters → Meaning: Price zones where many traders have placed their stop-loss orders. Example: If many traders longed BTC at $84K and placed stops at $78K–$75K, that zone becomes a stop-loss cluster. If price drops into that area, many stops trigger together → sharp sell-off.
Open Interest (OI) Collapsing → Meaning: Total value of open futures positions is dropping because positions are being closed or liquidated. Example: If Bitcoin futures open interest falls 35% since October, it means a lot of leveraged traders are exiting, willingly or by force.
Forced Deleveraging / Leverage Unwinds → Meaning: Leveraged positions are forced to close as price moves against them (margin calls, liquidations). Example: If BTC falls fast, many leveraged longs hit liquidation prices. Exchanges close them, reducing open interest. That’s a leverage unwind.
Liquidation Cascades → Meaning: One set of liquidations pushes price down, causing more liquidations, and so on — a chain reaction. Example: BTC breaks $84K, triggers some liquidations, price drops to $80K, triggers more stops and liquidations, and it spirals lower quickly → cascade.
Derivatives Positioning is Defensive → Meaning: Traders in futures/options are positioning for downside risk or sideways movement, not big bullish moves. Example: More people buying puts, fewer aggressive leveraged longs, more hedging = defensive positioning.
Structural Weakness (in ETFs) → Meaning: Not just short-term volatility — there’s a persistent, deeper problem with demand. Example: If Bitcoin ETFs see 3 weeks in a row of $2B–$3.7B outflows, that shows ongoing selling, not just a one-day panic. That’s structural weakness in demand.
Persistent Outflows → Meaning: Money keeps leaving funds week after week, not just in one spike. Example: Three straight weeks of huge ETF withdrawals → institutions are reducing their Bitcoin exposure, not “buying the dip.”
Long-Only Funds → Meaning: Funds that only buy and hold assets (they don’t short). Example: Many retirement funds or mutual funds are long-only. The article says they’re not dip buying, so big, steady buyers are absent.
The “ETF Bid” → Meaning: The consistent buying demand coming from ETFs when they were attracting new money. Example: Earlier this year, strong inflows into Bitcoin ETFs created an ETF bid that helped push BTC to $126K. Now that bid has “disappeared,” removing a big source of support.
Small-Cap Rotation → Meaning: Traders moving money into smaller coins hoping for bigger gains. Example: In late bull phases, people rotate from BTC/ETH into small caps like tiny game tokens or meme coins to chase 10x. The article says this rotation is now purely speculative and weak.
DeFi TVL (Total Value Locked) → Meaning: Total amount of value (in USD, ETH, etc.) locked in DeFi protocols (lending, DEXs, yield farms). Example: If DeFi TVL is stagnating, it means no new big money is entering DeFi – a sign of risk-off behavior in crypto.
Structurally Fragile (Altcoin Liquidity) → Meaning: Even if price bounces a bit, the foundation is weak — low liquidity, few real buyers, easy to crash. Example: SOL or XRP may bounce 5–10%, but if order books are thin, a big sell could still crash them quickly → fragile.
“Last to peak, first to collapse” (meme coins) → Meaning: Meme/small-cap coins usually pump late in a bull market and then crash early in the bear market. Example: DOGE, SHIB, WIF pumping after BTC already ran… then crashing heavily when liquidity leaves.
Risk-Off / Risk-On → Risk-on: Investors are willing to take risk (buy stocks, crypto, growth assets). Risk-off: Investors run away from risk and prefer safer assets (bonds, gold, cash). Example: The article says “macro has turned sharply risk-off” → big money is exiting risky stuff (like crypto) and moving into safer options.
Rotation Into Safety / Safe Haven → Meaning: Money moves from risky assets into safer ones. Example: Gold up 1% while crypto is falling = investors rotate into safety, treating gold as a safe haven.
Negative Skew → Meaning: An asset tends to fall more on bad days than it rises on good days. Example: On risk-on days, BTC might rise +1% On risk-off days, it might fall -4% That pattern = negative skew → more downside “bite” than upside reward.
Contagion Vector → Meaning: A channel through which stress in one area spreads to another. Example: If MicroStrategy (MSTR) gets kicked out of big stock indices, index funds may be forced to sell MSTR. If MSTR holds tons of BTC, this selling → hurts BTC sentiment → more selling in BTC.That stock → crypto connection is a contagion vector.
Reduce Exposure → Meaning: Lower your position size (hold less of the asset). Example: If you have 100% of your portfolio in crypto, reducing exposure might mean going down to 30–50%, or whatever fits your risk tolerance.
Avoid Leverage → Meaning: Don’t borrow money to trade. Use only your own cash. Example: If the environment is very risky and trending down, trading 10x or 20x leveraged futures is extremely dangerous; small moves can liquidate you.
Wait for Stability / Wait for a Real Bottom → Meaning: Stay patient until: Price stops making lower lows Liquidity improves; Fear calms down; Data (flows, depth, sentiment) turns healthier. Example: A “real bottom” usually shows sideways consolidation, less liquidations, slowly improving flows — not just a one-day bounce.
(10 minutes read time) Source: https://medium.com/@crypto-unfiltered/bitcoin-is-in-shambles-below-82k-the-entire-crypto-market-is-bleeding-caf9501b994d