Bitcoin witnessed over $100 million in leverage liquidations within the last 24 hours, raising concerns about a potential drop to the $50,000 level.
The liquidations in Bitcoin (BTC) amounted to $100.4 million, predominantly comprising more than $86 million worth of leveraged long positions, as per data from CoinGlass.
The trigger for these liquidations was three consecutive days of negative price movements, pulling Bitcoin’s price down from over $62,000 on July 2 to a low of $57,043 at 9:22 am UTC on July 4, as reported by CoinMarketCap.
Although Bitcoin has rebounded to trade above $57,800 as of 9:40 am UTC, it remains down by over 4.5% on the day’s chart.
Keeping a close watch on Bitcoin’s performance around key psychological levels like $60,000 is crucial for assessing the progression in the ongoing Bitcoin cycle, distinguished by the debut of the first spot Bitcoin exchange-traded funds (ETFs).
In a noteworthy update, Bitcoin dipped below the average realized buying price of spot Bitcoin ETF purchasers, which stood at $57,979—a pivotal support level for BTC analysts.
Despite this decline, there hasn’t been any panic selling from ETF buyers yet, as indicated by a mere $20.5 million net total outflow on July 3, predominantly from Grayscale’s ETF, accounting for around $27 million in outflows, according to Farside Investors.
Nonetheless, the possibility of ETF panic selling looms as investors reconvene following the Fourth of July holiday, also known as Independence Day in the United States.
The imminent repayments from Mt. Gox, anticipated in early July, could introduce additional selling pressure on Bitcoin. The Mt. Gox creditor reimbursements are slated to disburse over $9.4 billion worth of Bitcoin to 127,000 creditors who have awaited fund recovery for more than a decade.
Following a three-day price descent, Bitcoin breached its 200-day trend line for the first time in 10 months. This implies that a promising breakout will face further delay until Bitcoin breaks the downtrend that commenced in early June, per insights from prominent crypto analyst Rekt Capital, shared in a July 3 post.
Even though some technical chart analyses hint at a potential price shakeout — a rapid drop triggered by numerous investors exiting positions, followed by a sudden rebound, indications from renowned Bitcoin investor Elja Boom on July 4 suggest a likely Bitcoin shakeout based on technical assessments.
Nonetheless, analysts at 10x Research caution that Bitcoin may revisit the $50,000 threshold owing to escalating sell orders.
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