Diversitas

Market Update👀

The sell-off continues, marking one of the deepest corrections in recent years. We are now at a point where the market should be finding a bottom, and historically, this is where strong reversals begin to take shape.📉 Recent Major Corrections:

🗓 Aug 2023: -22%

🗓 Jan 2024: -21%

🗓 Aug 2024: -33%

🗓 Feb 2025: -27% (Current)

This has been one of the most brutal corrections to date, but history suggests that the bigger the drop, the stronger the bounce. We’ve faced a relentless wave of bad news over the past few weeks, unlike anything we can recall in recent years. However, sentiment is stretched to extreme fear levels, and as we know, markets tend to recover when fear peaks. Better times are on the horizon.

Why We're Transitioning to a Daily Timeframe?🤔

In past market cycles, the best-performing strategy relied on the weekly trackline as a guide for exits and re-entries. However, market dynamics have shifted, making that model less effective in the current environment. As seen in the attached screenshot, we started the week above the trackline but have now fallen deeply below it, approaching the weekly close. This shift highlights the need for a more adaptive approach.

We began observing these changing patterns a while ago, which is why we developed a new model and a few weeks ago announced a transition to a model based on daily timeframes. This adjustment is designed to:

✅ Improve risk management

✅ Enable quicker reactions to market shifts

✅ Capitalize on opportunities while minimizing drawdowns

The transition process is already well underway, and we believe this strategic shift will give us a significant edge in the evolving market landscape. While volatility may persist, history has shown that major corrections set the stage for even stronger recoveries. The key is patience and a data-driven approach. Buckle up—the next phase of the cycle is coming🚀

Quick update:

Just to clarify a few key points, as many comments suggest a misunderstanding of our strategy despite our regular updates:

• Weeks ago, we shared details about our transition to a new algorithm and outlined the process.
• We have followed that plan exactly as communicated.
• We didn’t expect such a sharp selloff during this transition, but market movements like these are beyond our control.
• Selling in the middle of a major correction is rarely a good strategy, so we are staying committed to our original plan.
• Much of investing is about avoiding FOMO buying and panic selling—this is a key principle of our strategy.
• The Fear and Greed Index is at 10 (Extreme Fear), the lowest print in years.
• Bitfinex whales continue to increase their long positions, signaling confidence in a recovery.
• Corrections like this are usually short-lived, and the recovery has already begun.
• Altcoins are holding up extremely well, showing strength in the face of the dip.
• We are transitioning to a new algorithm model on a daily timeframe, improving risk management.
• Until all assets move above the trackline on the daily timeframe, no structural changes will be made.

P.S. It seems like people are forgetting that we make money only when you do, so our interests are fully aligned. Our goal has always been to navigate the market strategically and maximize returns over the long run. Short-term volatility is unavoidable, but the bigger picture remains intact.

Today there will be no crypto market pulse update as we will be stuck on a long flight for most of the day✈️ The next one is expected to be posted tomorrow 🙌

Quick update👀

Market manipulation remains in full swing as some market participants are doing everything in their power to liquidate traders and regain liquidity—liquidity that has otherwise dried up due to strong institutional and corporate accumulation. Just yesterday, news broke that Citadel Securities, one of the biggest players in the U.S. stock market, plans to become a liquidity provider for the crypto market. It wouldn’t be surprising if they’re playing a role in these orchestrated drops.

That said, at this point, it doesn’t really matter. Our mistake was staying in the market while waiting for the new algorithm to flash green signals. We began the transition in the middle of a correction and aimed to avoid selling at the bottom, which led to holding through the drawdown. Ironically, every time we upgrade our algorithm to a better one, the market seems to experience a rare, high-magnitude drop. The bounce will come—it’s just a matter of time. The good news is that our new algorithm is designed to protect us from these kinds of moves, so hopefully, this is the last time we see such a drawdown.

Selling now is too late—we’ve likely hit the bottom of this correction or are very close. The Fear and Greed Index is now at Extreme Fear, signaling that sentiment has hit rock bottom. Historically, this is when markets begin to turn. Once momentum builds, the recovery could be swift, with prices returning to previous highs within weeks.

Right now, patience is key.

1. Market Overview

Despite strong institutional adoption and overall bullish developments, it feels like we are in the middle of a bear market. A major factor contributing to this stagnation is the wave of market disruptions over the past few weeks🤔

Most recently, on Friday, the market dipped following the largest crypto hack in history. The North Korean hacker group Lazarus, led by FBI-wanted Park Jin Hyok, stole $1.46 billion worth of $ETH from Bybit. Fortunately, Bybit has been managing the situation well, with enough reserves to cover the losses. They are also receiving support from the broader crypto industry, making it likely that this drop will be short-lived and eventually bought up by whales.

Here’s a recap of the past few Fridays👀

• Jan 17 – $TRUMP token launch
• Jan 24 – DeepSeek crash
• Jan 31 – Trump tariff announcement on Canada
• Feb 14 – $LIBRA launch
• Feb 21 – Bybit $1.46B hack

P.S. We're beginning to see a volatility squeeze forming on $BTC, $ETH, $AVAX, $INJ, and several other coins. This pattern often precedes a breakout and a significant shift in direction. If history is any guide, we should see a move in the next few days, as these squeezes typically don’t last long.