Bitcoin’s sharp pullback from $126,000 to $80,000 was largely driven by market psychology rather than fundamentals, according to crypto analyst Plan C.
In a post on X, Plan C explained that the decline reflects speculative behavior and flawed probability thinking among traders. He compared the situation to flipping a coin three times and landing on heads each time — a scenario that often leads participants to falsely assume the next outcome must reverse.
This mindset, known as the gambler’s fallacy, triggered widespread selling as market participants assumed Bitcoin’s rally had become statistically “overdue” for a correction.
Rather than responding to on-chain weakness or macro deterioration, traders reacted to perceived patterns and emotional expectations, amplifying volatility.
Plan C noted that such behavior is common in financial markets, particularly in crypto, where price action is often driven by sentiment, positioning, and collective psychology more than traditional valuation metrics.
