Here's The Real Reason Crypto Has Been Down Lately We know the macro sucks. But that alone isn't a death sentence. In recent history, we've seen sharp gains across crypto even while the broader macroeconomic environment has been troubling. No, I believe the primary factor driving the market lower over the past couple of weeks has been the incredible resilience of highly leveraged LONG perpetual futures traders. With data provided by the engine powering liquidate.fun - which ingests fresh market data approximately four times per second - I've been able to observe a persistent trend over the past week: the overwhelming majority of traders remain long. One group of longs gets wiped out, and another immediately steps in to replace them. At the time of this posting: BTC: 64% long ETH: 76% long SOL: 72% long Across all three assets, there is considerably more liquidation fuel sitting within a 3% move to the downside than within an equivalent 3% move to the upside. While nothing is ever guaranteed, markets have a tendency to follow the path of least resistance unless there is a catalyst to the other direction. Furthermore, markets rarely reward the crowded trade. Despite all the downside we've already experienced, we're still not seeing the kind of capitulation I believe is necessary before the market can establish a sustainable foundation for another move higher. Every time the market attempts to flush out excessive leverage, another wave of traders rushes in to catch the falling knife. In doing so, they inadvertently create the very conditions that make further downside attractive. It's a self-perpetuating cycle. Until that cycle breaks, I believe meaningful upside will remain difficult to obtain. While I never recommend taking highly leveraged positions, if you're determined to do it anyway, at least consider positioning your liquidation levels 10% or more (on BTC) away from the current price. That doesn't eliminate your risk, but it may reduce your vulnerability to relatively ordinary market movements. Otherwise, you're simply continuing to provide fuel for the downside. The irony is that many of the traders desperately trying to position themselves for the next rally are helping prevent it from happening. Right now, the bears are playing this game considerably smarter than the bulls. Until that changes, I see little reason to believe the market is finished teaching us this lesson. 🫡 From the depths — The White Whale 🐋