Bitcoin price has once again taken the spotlight, as the market experiences significant fluctuations leading to massive crypto liquidations. Over the past 24 hours, traders saw over $250 million in liquidations. This dramatic shift is a wake-up call for those monitoring the cryptocurrency market.
Bitcoin’s Support Retest and Bearish Control
According to recent analyses, Bitcoin is on the verge of retesting its support at the lower end of its local trading range. With bears keen on regaining control, both long and short traders are feeling the impact of liquidations. The ongoing lack of demand exacerbates the challenges faced by Bitcoin bulls.
Data from TradingView shows a 2.3% drop in Bitcoin prices, with the $68,500 level becoming a critical focal point for market participants. Despite this, exchange liquidations have remained high, reflecting the market’s current volatility.
Market Dynamics: A Battle for BTC Price Trends
CryptoReviewing, a pseudonymous cofounder of Wealth Capital, noted that Bitcoin’s price had soared to $71,000, leading to $130 million in short liquidations. However, it quickly dropped back to $68,000, causing another $150 million in long liquidations. This highlights the high-stakes nature of the current market environment.
Material Indicators further warned of a low-time frame support retest, citing continued selling by large-scale investors, often referred to as ‘purple whales.’ Their proprietary tools suggest Bitcoin is poised for a possible retest of local support.
Weakening Demand and Market Outlook
On-chain analytics platform CryptoQuant highlighted the lack of new investor capital as a significant issue. Despite increased spending of coins, the inflow of fresh capital hasn’t matched the pace, leading to negative demand growth.
This situation suggests the market’s ability to absorb the distributed supply is weakening. Historically, such divergences have marked transition phases where bullish momentum slows, potentially leading to consolidation or correction.
Cointelegraph previously reported on the challenges faced by Bitcoin miners, who have increased their inflows to exchanges to cover operational expenses. The anticipation of a prolonged Bitcoin bear market continues to gain traction among analysts.
