Here's why bitcoin is so volatile: trader

As the world reopens and traders flock to the beaches, investing during the illiquid summer months is already proving to be a challenge with the uptick in volatility in various sectors and asset classes. Keith Bliss, president of Capital2Market, joins Yahoo Finance's Jared Blikre to help navigate this unique market environment for cryptocurrency.

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KEITH BLISS: Yeah, so if you were to draw a long-term trend line starting at that point and hitting all the dips that came in to use as your support level, you can see that it broke support pretty violently when it started to pull back, based upon investor sentiment. Sometimes when this happens with other asset classes as well, when you have a consolidation at a certain price and then the market's trying to decide what it's going on, you're waiting for that one catalyst either to make it break out or to pull it back below the support line.

And what we saw with Bitcoin is a few things. First off, Tesla decided that they were no longer going to accept it as payment for their cars, is one catalyst that we saw. People started beating Elon Musk up pretty radically, both on Bitcoin as well as Dogecoin. And then the news this week really made a fall below a shorter term trend line was the fact that the FBI had recovered the Bitcoin from the Russian hackers. So people were worried about the security of Bitcoin, you know. There's still questions about how did the FBI locate that. And you know, it's probably smarter people than me, especially in the spy business, the espionage business probably could answer that better than I can.

But the effect was it gave the market pause for reflection on Bitcoin and other cryptos. Is it really safe and secure as it's been advertised? And that's why you see those catalysts. In the absence of pure fundamentals, like you would see with a Procter and Gamble or an Exxon Mobil, where you can certainly do with the discounted cash flow over future 12 months will be and then determine what is a fair price for that equity, Bitcoin doesn't have that. It's investor sentiment and catalysts outside of any kind of fundamental reckoning within the asset.

So that's why it's kind of fun to chart what you're doing there. So yeah, I try to deploy any and all technical indicators techniques when we're looking at not only Bitcoin but also the other cryptocurrencies.