Bitcoin Plummets 144 Million Liquidated As Market Reacts To Profit Taking And Other Factors
Significant Insights on Bitcoin’s Recent Price Drop
The recent decline in Bitcoin’s price can be attributed to the swift liquidation of leveraged long positions, prompted by selling pressure that led to a correction from the peak of $122,000 over the preceding fortnight. This series of liquidations has caused Bitcoin (BTC) to plummet to approximately $115,000.
Current Market Status of Bitcoin
As of recent reports, Bitcoin is down 5.8% from its all-time high of $123,091, which was achieved on July 14. In the past 24 hours, Bitcoin has decreased by 2%, while its daily trading volume has surged by 24.6%. This spike in volume indicates intense selling activity, particularly as prices fell below the crucial local support level of $116,000.
External events, such as the ongoing conflict at the Thailand-Cambodia border, may have contributed to this market pullback. While these local tensions are likely to have a short-term effect on investor sentiment, they may not alter the long-term trajectory of cryptocurrency prices.
Influence of ETF Flows on Market Dynamics
From July 21 to 23, Bitcoin spot ETF flows reflected a negative sentiment, reinforcing the bearish outlook in the market. However, on July 24, there was a notable inflow of $226 million, despite Bitcoin experiencing a slight decline of 0.35% on the same day. This suggests that, while the market sentiment appears subdued, there are investors willing to seize opportunity amidst the downturn.
Liquidations Impact Bitcoin Pricing and Potential for Recovery
In the last 24 hours, a staggering $144.8 million in Bitcoin positions were liquidated, with $128.77 million stemming from long positions. The breakdown below local support levels of $117,000 and $116,000 has triggered a modest market pullback. Historically, during bullish trends, drawdowns of 20% to 30% are common, making a 5.8% decline a minor concern for seasoned investors, although caution is always advised.
CoinGlass has reported a significant addition of 10,000 Bitcoin Open Interest (OI) in the BTC/USDT pair on Binance, coinciding with Bitcoin’s retest of the $115,000 support level. This influx of Open Interest suggests the potential for increased volatility in both upward and downward directions.
Technical Analysis and Future Predictions
The 4-hour chart indicates that the critical short-term support zone between $116,000 and $117,000 has been breached. The high trading volumes observed recently underline a bearish conviction among traders, which could potentially lead prices toward the next significant demand zone around $111,000 to $112,000.
As the market evolves, investors and traders should remain vigilant, analyzing both technical indicators and broader market sentiments to navigate the current landscape of Bitcoin.
For continuous updates on market trends and breaking news in the cryptocurrency sector, visit our dedicated cryptocurrency news portal.
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