📉 Market Dynamics and Sentiment
The internal structure of the crypto market itself contributes to the daily declines
Liquidity and Whale Selling Large-scale sell-offs by major holders ("whales") can overwhelm buy side demand, leading to sharp price drops and triggering widespread panic selling
Long Liquidations Leverage Many traders use leverage (borrowed money) for their bets
When the price moves against them, their positions are automatically sold (liquidated) which creates cascading sell pressure and amplifies the downward movement
Fear and Greed Index Market sentiment, measured by indexes, often remains in the Fear or Extreme Fear zone, indicating that pessimism and a lack of conviction dominate the short-term outlook
ETF Outflows If institutional investors reduce their exposure, it's reflected in negative flows from crypto related ExchangeTraded Funds ETFs signaling a decline in institutional confidence
