As an experienced financial analyst, I believe that the recent pullback in Bitcoin price is not solely attributed to the rumors surrounding Mt. Gox’s alleged BTC sale. Although these reports may have triggered a sell-off, other factors such as upcoming US PCE inflation data, crypto market expiry on May 31, and significant liquidations are also contributing to the downward trend.
As a crypto investor, I’ve noticed that the price of Bitcoin took a hit today following rumors of a large-scale transaction from Mt. Gox to an unknown wallet. These reports sparked a wave of selling in the market. However, Mt. Gox later refuted claims that they had sold off $10 billion worth of Bitcoins and Bitcoin Cash for creditor repayments. Surprisingly, the market didn’t recover despite this denial from a former executive.
Why Bitcoin Price Is Going Down Today
Mark Karpeles, the ex-CEO of Mt. Gox, stated that “Things are going well with MtGox. The trustee is transferring coins to a new wallet in anticipation of the distribution which might take place this year; there’s no imminent bitcoin sale ongoing.”
As an analyst, I’ve observed a significant transfer of Bitcoins, leading to a decrease in the Bitcoin holdings for wallets with balances ranging from 1,000 to 10,000 and 10,000 to 100,000 units. This development has kept sentiment subdued among traders as they weighed other pertinent factors.
Bitcoin maintains its position above the significant support of $66,000. However, investors may be hesitant due to impending events such as the US Personal Consumption Expenditures (PCE) inflation data and the crypto market expiry on May 31st.
Approximately 68,383 Bitcoins worth around $4.66 billion in options are approaching their expiration date, according to CoinGape’s report. The put-call ratio stands at 0.57. This suggests that there are more call options (bets on price increase) than put options (bets on price decrease). The maximum pain point is currently $65,000, which implies a higher probability of Bitcoin selloffs following several days of low trading activity. Furthermore, implied volatility (IV), which measures the market’s expectation of future price swings, has been decreasing across all major terms. As a result, volatile price movements could potentially lead to a further decline in Bitcoin’s price.
Crypto Liquidations
In the past 24 hours, the cryptocurrency market experienced a significant liquidation event, with approximately $170 million in losses according to CoinGlass statistics. Amongst all coins, Ethereum (ETH) led the way in terms of liquidations, surpassing Bitcoin (BTC), which recorded a loss of around $25 million from long positions. The largest single liquidation order took place on Binance, where an individual executed a trade worth $4.92 million using Ethereum and Tether (ETHUSDT).
The price of Bitcoin decreased by more than 3% in the last 24 hours, now hovering around $68,243. The lowest and highest prices within this timeframe were $67,227 and $70,479 respectively. There’s been a notable increase of over 25% in trading volumes, suggesting heightened trader activity but with a degree of caution.
As a crypto investor, I’ve noticed some significant movements in the traditional financial markets recently. The US dollar index (DXY), which measures the value of the US dollar against a basket of six major currencies, has bounced back and surpassed the 104.54 mark following a recent drop. The reason for this uptick could be attributed to several factors, including poor auction results for the 5-year and 2-year US Treasuries that led to a selloff, causing an increase in demand for the dollar. Additionally, Neel Kashkari, President of the Minneapolis Federal Reserve, shared his perspective on the current monetary policy stance, acknowledging its restrictive nature while leaving the door open for further rate hikes if needed.
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2024-05-29 00:46