Bitcoin Price Drops Below $80K, Triggering Major Liquidations
Bitcoin’s price has fallen below $80,000, leading to $200 million in long position liquidations, while overall crypto liquidations reached $847 million. Factors include unfavorable macroeconomic conditions and a potential ‘sell the news’ reaction to recent presidential announcements. The current sentiment favors bearish momentum, creating opportunities for short positions amid volatile market conditions.
Recent analysis indicates a significant downturn for Bitcoin (BTC), which has dipped below $80,000, triggering liquidations totaling approximately $200 million from long positions. Data from CoinGlass reveals that overall crypto liquidations across exchanges reached $847 million in the past 24 hours, with $656 million linked to long positions, affecting roughly 299,730 wallets.
In terms of specific assets, long positions on BTC saw liquidations near $190 million, underscored by a more severe liquidation of $196 million in Ethereum (ETH) long positions as the asset fell beneath the $2,000 support level. The failure of Bitcoin to maintain above the $80,000 mark raises concerns of further declines, potentially eyeing the $65,000 threshold.
This decline coincides with the anticipation of the President’s establishment of a Bitcoin Strategic Reserve. Market participants may be experiencing a “sell the news” reaction following this announcement. Notably, BTC futures open interest has hit its lowest since November 6, suggesting a complete fading of the momentum garnered post the recent Presidential election.
Macroeconomic conditions remain unfavorable, with the Federal Reserve displaying caution regarding interest rate reductions until the implications of new tariffs are assessed. The recent imposition of higher tariffs on Canadian steel by the President reflects continued tensions impacting market sentiment.
The BTC price currently hovers around $78,250 after earlier losses during the American trading session. While buyers did step in below this level, there remains an expectation for increased demand from long-term investors anticipating a rally towards $100,000.
Despite potential recovery, bearish momentum is indicated by a declining Relative Strength Index (RSI) and an accelerating negative trend on the MACD histogram. The hourly chart depicts a confirmed double-bottom pattern as BTC recovered from $76,000, yet buying pressure has encountered strong selling resistance as bulls attempt to reclaim $80,000.
To reverse the current downtrend, the price must exceed $85,000 to pave the way back towards $90,000. However, the prevailing market sentiment is bearish, making short positions with favorable risk-reward ratios more attractive for traders, particularly when considering potential retests of recent lows. Exercising caution is essential in this volatile environment to mitigate excessive risks.
In conclusion, Bitcoin’s recent decline below $80,000 marks a notable shift in the cryptocurrency landscape, influenced by significant liquidations, bearish market sentiment, and macroeconomic factors. Traders face a precarious environment, with short positions becoming increasingly viable as they navigate potential price fluctuations. A focus on cautious trading strategies and precise position sizing is paramount to manage risks amid these developments.
Original Source: www.fxempire.com
Post Comment