Bitcoin's $103K Struggle: Liquidations Signal Shift?
Bitcoin (BTC) has faced challenges maintaining upward momentum after reaching a local high of $108,000 a week ago. Trading within a tight range of $103,000 to $106,000, BTC experienced a sharp decline to $102,000, triggering significant long liquidations.
Bitcoin Long Liquidation Spike
CryptoQuant analyst Axel Adler noted a 10% surge in Bitcoin's long liquidation dominance over the past week. Despite this, BTC remained within its narrow trading range. This increase in liquidations without a drastic price drop suggests underlying buyer support.
Key observations:
- BTC traded between $103,000 and $106,000.
- Long liquidation dominance increased by 10% in seven days.
- 2,200 BTC in long liquidations, the highest level of the week, indicates potential panic selling.
Source: CryptoQuant
Typically, high long liquidation levels indicate that bullish investors are being forced out. However, the recent spike, coupled with the relatively stable price, presents a more nuanced picture. The negative funding rate suggests aggressive bets on further price declines.
Source: CryptoQuant
Source: CryptoQuant
What's Next for Bitcoin?
At the time of writing, Bitcoin is trading near $103,763. This price stability, following the dip, presents both opportunities and risks. A further 5-7% increase in long liquidation dominance could potentially wash out bearish sentiment, potentially leading to a short squeeze.
A positive taker buy-sell ratio suggests buyers are returning to the market, potentially driving Bitcoin towards $104,577. Conversely, renewed selling pressure could push the price back towards $102,000.
Source: CryptoQuant
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