Recently, the value of cryptocurrencies took a sharp turn downward. The total market capitalization of all cryptos dropped by around 8%. This slide in prices occurred at the same time that data from Bitcoin Liquidation Heatmap indicated the possibility of a massive short liquidation for Bitcoin, worth approximately $1.43 billion, if the price of Bitcoin fell below $71,500.
The reason Bitcoin’s price dropped to $65,254 is due to several factors such as options expiry, historical trends following halving events, broader economic conditions, and technical weaknesses. In one hour alone, more than $200 million worth of leveraged crypto positions were forced to be closed, resulting in a massive $885 million in liquidations during the last 24 hours.
The fast changes in the market have led to various responses from market players. Some traders are using social media to debate and examine the circumstances. Even during this downturn, certain traders believe there may be chances for purchasing, demonstrating the unpredictable and frequently fluctuating character of the cryptocurrency market.
Macro Factors and Geopolitical Tensions Impact Crypto Market
The latest shift in market directions is mainly caused by larger economic and political issues, with escalating conflicts in the Middle East being a significant contributor. The possibility of Iran launching an attack on Israel’s northern region has fueled geopolitical anxiety, resulting in heightened market instability.
It’s intriguing to note that traditional assets have undergone comparable sell-offs even as gold rises, suggesting a more significant change in market sentiment. Although the current market slump has some experts in cryptocurrency cautiously optimistic, they argue that crypto sell-offs are temporary due to the market’s inherent volatility. These sell-offs could offer shrewd investors potential buying opportunities when market conditions become more stable.
Asset Prices Spark Crypto Market Liquidations
In the last 24 hours, cryptocurrencies have experienced a significant 7% drop. Bitcoin spearheaded this trend, decreasing by 5.21% and eliminating its weekly progress. This decline affected altcoins as well, causing some of them to plummet by as much as 17%.
Market analysts predict that Bitcoin’s price may continue to drop due to the upcoming sale of around $5 billion in Bitcoin by miners and large investors (whales) following the halving event. This impending sale contributes to the existing market stress, with Bitcoin currently valued at approximately $67,211.
Market experts underline the significance of surpassing significant resistance points to reduce current market tension and improve confidence in the long term.
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2024-04-13 14:51