Bitcoin Leverage: Lack Of Liquidations Could Indicate Another Wave Of Selling

Bitcoin finally broke below the $40K point this past weekend. This had sent the cryptocurrency back towards six-month lows. One thing though was that liquidations or the digital asset remained lower than expected. The current liquidation volumes lay well below the volumes that have accompanied previous crashes like this one. This could be a very important indicator for the market. Bitcoin Liquidations Remain Low In Shakeout Previously, whenever the price of bitcoin had dumped this hard, liquidation volumes have quickly risen. This is due to the massive sell-offs that follow such crashes as investors try to get out of a bleeding market. This time around, bitcoin liquidation volumes have not jumped. They remain really low, indicating that maybe investors were not done selling their holdings. Related Reading | Has Bitcoin Reached Its Bottom? Analyst Says It Still Has A Long Way To Go If this is the case, then there may be more downside coming as the week runs toward the end. Massive sell-offs have already sent the digital asset to lows not seen since mid-last year. Another round of sell-offs could end up pushing the cryptocurrency’s value down below $30K. Last Friday, when the price of BTC had successfully broken below $40,000, the bitcoin futures and perpetual markets were rocked by liquidation. By the time the beginning of the weekend rolled around, over $854 million in long liquidations were already recorded. This may seem like a lot but compared to previous iterations of this type of shakeout, liquidations have fallen short. BTC liquidation volumes fall short of expectations | Source: Arcane Research May 2021 was the last time that BTC’s price had taken a similar plunge. In total, the market saw $4.8 billion worth of liquidated longs across the market. Indicating that the sell-off in May was more intense than those recorded in January of 2022. One explanation for the low liquidation volumes is that traders were able to re-allocate and add collateral to underwater trades, given that they’ve had more time to reassess their positions. Where Are The Liquidations Happening? Another reason for the low liquidation volumes could be the data available for analysis. Back in May 2021, crypto exchanges like Binance and ByBit had their bitcoin liquidation data out for anyone who wanted to have a look. Since then, there has been a change by both exchanges where they now restrict their liquidation. Now, analysts are having to guesstimate liquidation volumes using historical data from the exchanges. BTC price begins uptrend | Source: BTCUSD on TradingView.com Binance still retains dominance of the market, thus, not having access to the crypto exchange’s bitcoin liquidation data could severely affect the volumes of liquidations being reported. The crypto exchange’s dominance in the market has risen since before its data was restricted, suggesting an even larger pool of liquidations that are not being reported correctly. Related Reading | Bitcoin Whales Take Advantage Of Market Crash To Gobble Up Millions In BTC Nevertheless, the liquidations have spilled into other spaces in the industry. Decentralized finance (DeFi) did not escape the onslaught in the least as it was also rocked by liquidations. Featured image from Bitcoin News, charts from Arcane Research and TradingView.com

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Bitcoin Price Falls With Long Liquidations

As is typical in the bitcoin market, the bitcoin price fell as there were $154.5 million in long liquidations.

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$16 Billion In Possible Liquidations Suggests Where The Bitcoin Price Is Headed Next

Crypto analyst Kevin Capital has provided insights into where the Bitcoin price may be headed next. The analyst alluded to the current liquidation data, revealing that there are currently $16 billion in possible liquidations from BTCs current price to the $107,000 price level.  Liquidation Data Indicates A Bitcoin Price Recovery Is Imminent In an X post, Kevin Capital revealed that there is only $1.5 billion in long liquidations from the current Bitcoin price to the $77,000 price level. On the other hand, there is $16 billion in short liquidations from the current price to the $107,000 level. The analyst remarked that this is one of the biggest disparities in history.  Related Reading: Bitcoin 9-Month Cycle Says Its Not Over, Analyst Shows Where We Are In The Bull Run He further noted that the market makers prefer to move prices where they can most transact. As such, this suggests that the Bitcoin price could rebound as these market makers look to grab the liquidity at the upside. Kevin Capital remarked that patience is still needed while the 3-day resolves itself. However, he added that overall, things are looking a little clearer for the bulls.  The Bitcoin price has crashed over the past two days, dropping to as low as $86,000, sparking concerns that the bull run might be over. However, Kevin Capital’s analysis provides some optimism that the bull run is far from over and that the flagship crypto could still reclaim the $100,000 price level and possibly reach new highs.  BTCs long-term holders also seem confident that the Bitcoin price will still go higher. In an X post, crypto analyst Ali Martinez revealed that they had accumulated almost 20,400 BTC following the sharp sell-off that began two days ago.  BTC Could Still Drop To The $80K Lows Crypto analysts Ali Martinez and Titan of Crypto have suggested that the Bitcoin price could still drop to the lower part of the $80,000 range. In an X post, Martinez stated that Bitcoin is showing similarities to the 2021 market top. He further remarked that if this pattern holds, there could be a period of consolidation at current levels before the next leg down for BTC.  Related Reading: This Analyst Called The Bitcoin Price Crash Early, Total Prediction Says More Pain Is Coming His accompanying chart showed that the Bitcoin price could drop to as low as $80,850 when this next leg down occurs. Titan of Crypto also raised the possibility of BTC dropping to $81,000. He stated that BTC is breaking the trendline and dipping below the last wick low. He claimed that BTCs weekly candle failing to reclaim the trendline could send the flagship crypto to the next support, which is Kijun at $81,000. At the time of writing, the Bitcoin price is trading at around $88,700, down over 3% in the last 24 hours, according to data from CoinMarketCap. Featured image from iStock, chart from Tradingview.com

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Bitcoin Flash Crash Causes $710 Million In Crypto Long Liquidations

Data shows the cryptocurrency derivatives market has suffered a massive amount of liquidations after the Bitcoin flash crash during the past 24 hours. Bitcoin Has Witnessed Significant Volatility During The Last Day BTC has displayed some wild price action in the past day, with both a high of $103,500 and a low $90,500 occurring inside [...]

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