The phrase “hindsight is 20/20” is a perfect expression for financial markets because every price chart pattern and analysis is obvious after the movement has occurred.
For example, traders playing the Feb. 28 pump that took Bitcoin (BTC) above $43,000 should have known that the price would face some resistance. Considering that the market had previously rejected at $44,500 on multiple instances, calling for a retest below $40,000 made perfect sense, right?
Bitcoin/USD at Coinbase. Source: TradingView
This is a common fallacy, known as “post hoc” in which one event is said to be the cause of a later event merely because it had occurred earlier. The truth is, one will always find analysts and pundits calling for continuation and rejection after a significant price move.
Usually after strong #Bitcoin rallies like the one we just saw today, we tend to get follow through.
As I said earlier, the sheer disbelief during this rally has me optimistic in the short-term.
Still no guarantees of new highs immediately, but at least maybe a local uptrend.
— Benjamin Cowen (@intocryptoverse) March 1, 2022
Meanwhile, on March 2, Cointelegraph reported that Bitcoin “could force a $34K retest.” The analysis cited an “ailing momentum” because Russia had just announced its invasion of Ukraine.
In the past seven days, the aggregate market capitalization performance of the cryptocurrency market showed an 11.5% retrace to $1.76 trillion and this move erased the gains from the previous week. Large cap assets like Bitcoin, Ether (ETH) and Terra (LUNA) were equally impacted, reflecting nearly 12% losses in the period.
Weekly winners and losers among the top-80 coins. Source: Nomics
Only two tokens were able to present positive performances over the past seven days. WAVES rallied for the second consecutive week as the network upgrade to become Ethereum Virtual Machine (EVM)-compatible advanced. The transition is scheduled to start in the spring and the new consensus mechanism will provide a “smoother transition to Waves 2.0.”
THORChain (RUNE) jumped after completing its Terra (LUNA) ecosystem integration, enabling the blockchain to…