4 Reasons Why the Crypto Market Is Dumping Hard This Week

The current crypto market dump is driven by the quarterly $23 billion options expiry, rising US government shutdown risks, and the mass liquidation of excessive retail leverage. Ultimately, this downturn is viewed as a strategic whale setup designed to panic-sell retail holdings before the anticipated Q4 rally begins.

1) Options Expiry

Tomorrow, $23 billion in Bitcoin and Ethereum options will expire. This is a quarterly options expiration and often brings high volatility.

The max pain price for $BTC is $110,000 and $3,700 for $ETH. Usually, whales drive prices toward max pain, and that's what's happening.

2) US Government Shutdown

The odds of a US government shutdown by October 1 is now at 67%. In the past, US government shutdowns have resulted in market correction, and this is why people are panicking.

3) Strong Economic Data

Today, Q2 GDP revised data came at 3.8% vs. 3.3% expected. Good economic data is bullish in the long term but bearish in the short term. This is because good economic data lowers the chances of rate cuts.

4) Excessive Leverage

In the past week, retail opened high leverage positions due to perp DEX hype. At one point, alts open interest was almost 2x that of Bitcoin. And right now, those people are getting liquidated, which is causing a market dump.

Conclusion

I think this is a perfect set-up by whales to panic sell your coins before Q4. They started September in a bullish way to make people think that it will be up-only. Now whales are dumping, so people panic sell before the Q4 rally.

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