Now, if you want my opinion on why this price drop happened, it's probably only one or a few agents acting (because the majority of bitcoins are held by only a few entities) purposely manipulating the market. They probably sold a bunch of coins (to themselves) for a very low price, causing a panic (think Great Depression). So, then average Joes get scared and try to sell their coins (at this artificially low price) as fast as possible. Then those big entities swoop in, buy them and own even more of the market share. Which actually is a good thing for people like us who are in it for the long haul. Does that make sense?
Yep. People who have a lot of money to begin with usually know how to manage that money (or hire people who do), and they want that money to grow.
With a panicky market, you can do so by scaring the herd and causing a stampede. So you see a lot of these sort of "dive and recover" dips as the big money throws it's weight around, and shakes out the weak hands. Then the market stabilizes, and anyone who gets too greedy and tries to do it again just hands their money over the smarter players.
Then you get a major news hit, and there's a lot more new players, some of whom are smart, some of whom are too greedy, and some of whom are panicky. Somebody says "Boo," and it all happens again.
Hang in folks, there's a lot of stupid, panicky, and greedy people out there, and not all of them have heard about Bitcoin yet. It's gonna be a bumpy ride, but we'll get there.
