Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Bitcoin’s 13% price fall over the past day led to a dip in the overall crypto market cap.
- Longs wrecked massively, with $373.37 million worth of positions liquidated.
The events of the past 24 hours shook the crypto market, with Bitcoin [BTC] experiencing a 13% dip over the past day. This saw the king coin briefly touch the $25k price zone before recovering to trade at $26.5k, as of press time.
Read Bitcoin’s [BTC] Price Prediction 2023-24
According to CoinMarketCap, the global crypto market lost over 6% of its market capitalization within the period. BTC’s market dominance also dropped to 48.45%, representing a decrease of 0.56% over the day.
With lots of speculation in the markets about BTC’s sudden price drop, investors and traders alike maintained a cautious approach as events unraveled.
Has the market dump been coming?
BTC’s price chart over the four timeframe showed a significant consolidation around the $29.4k price zone. This was after the price rejection at the bearish order block (OB) between $29.8K and $30.3K.
With Bitcoin’s market structure flipping bearish on the daily timeframe in late July, short-term sellers have been priming for a sustained downtrend.
Amid the rising volatility, the Relative Strength Index (RSI) dropped deep into the oversold zone, hitting 5.31 on the four-hour timeframe. Likewise, there were notable capital outflows which saw the Chaikin Money Flow (CMF) drop to -0.27, although it eased a bit to -0.18, as of the time of writing.
The cautious approach by traders could limit a price recovery for BTC, with sellers still dominating the market. With a Fair Value Gap (FVG) between $25.1k to $26.5k, sellers could push for a retest of the $25.3k price zone before bulls can initiate a sustained rebound.
Longs wrecked massively in the futures market
The sharp price drop saw millions of long positions wiped out across several exchanges. Data from Coinglass showed that $373.37 million worth of long positions were liquidated in the last 24 hours. This amounted to 74.8% of the total liquidations of $499 million within the period.
How much are 1,10,100 BTCs worth today?
Similarly, there was a spike in exchange inflows within the same period, per Santiment. This highlighted the huge sell pressure which contributed to the price capitulation.
While the press time price levels could be considered a decent buying opportunity, the bearish price action was something to keep an eye out for, with a lot of active sellers still in the market.