let me remind you of this, that this is not the first time bitcoin has crashed very significantly and is not the worst of it all. (correct me if i'm wrong) Based on bitcoin history, crashes occur on:
2011 jun- Nov: -97%---> From $ 32 to $ 2
2012 jan - Aug: -36%---> From from $ 7 to $ 4
2013 Mar 6 -11: -25%---> From $ 49 to $ 36
2013 Apr 10: -79%---> From $ 266 to $ 54
2014 Feb 24: -49%---> From $ 867 to $ 439
2017 jun 11-16: -36%---> From $ 3,000 to $ 1.869
2017 Sept 2-15: -40%---> From $ 5,000 to $ 2,972
2018 Jan 17: -48%---> From $ 19,783 to $ 9,496
If viewed from history, crashes often happen every year since 2011 and proved that this year is not the worst year of the year - the year before. What do you think, whether this crash will continue or not?
You are looking at relatively high frequencies (that is: the order of days or weeks). You can say that bitcoin has a potentially high volatility on the order of days or weeks. Volatility is to be seen as a frequency spectrum.
What is more interesting, I think,
are much longer-range movements. I can see 2 similar movements in the past, when you look over a range of the order of a year or longer, where we see retractions of the order of an order of magnitude. Bitcoin has known essentially these long-range movements:
1) an upwards movement from $0.1 in 2010 to an ATH in summer of 2011 ($30), followed by
a crash of a factor of 10 in the year that followed ($3).
2) an upwards movement from that low $3 up to an ATH in December of 2013 ($1100) followed by
a crash of a factor of 6 in the two years that follow ($200) in 2015.
3) an upwards movement from that low $200 up to an ATH in December of 2017 ($20000) followed by ...
It is true that the upwards movement in (2) from $3 all the way up to $1200 has been seen
a pause after a high of $150 in April 2013 by a correction back down to $76 in July 2013 before the final uprun to near $1200 in December 2013. Note that the correction was of the order of 50%.
So are we now in such a similar correction, before a next up run before the real crash, or is the next crash down by an order of magnitude already in motion, hard to say.
It seems reasonable to assume that the crash set in, because of the size of the up run.
The first up run was x300. The second up run was x400. The "correction" in Summer 2013 was after an up run of about x50. It was followed by another up - run of x8 before crashing for good.
We have seen the last up run being a factor of x100. Is that small enough to allow for a correction and next smaller up run, or is that big enough for a genuine crash ?
We've seen, on a shorter time scale, that the crash periods are long, and punctuated by a lot of bull traps.