Bitcoin Crashes To $27.3K, Traders Lose Big On Liquidations
While Bitcoin accounted for the largest liquidation, at $63.03 million, Ethereum was not far behind with $54.20 million in liquidations. Other cryptocurrencies like Dogecoin, Arbitrum, Chainlink, XRP, Litecoin, and Solana were affected less severely, with less than $5.5 million in liquidations.
Liquidations were mainly observed in trading activity on Binance, OKX, Huobi, and Bybit. As a result, the market saw a total of 57,269 traders liquidated, according to site data.
It is worth noting that the drop in value of Bitcoin is not an isolated event. The cryptocurrency market is known for its volatility, and it is not uncommon to see sudden drops or spikes in value. Despite this, investors continue to show interest in the cryptocurrency market, as its potential for high returns remains enticing.
Bitcoin’s value closes in on $27.3k
BTC was priced at $27,269 as of 9 p.m. UTC but was valued above $28,200 earlier in the day. In all, the price of Bitcoin is down 3.4% over 24 hours.
Other leading assets have also lost value. Ethereum (ETH) is down 4.9% and XRP is down 5.6%, while Dogecoin (DOGE) is down 6.8%.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Bitcoin Crashes Below $20.3K As Regulatory Pressure Intensifies, It’s A Bloodbath
Bitcoin (BTC) margin and options markets are currently steady, even as the investors run for cover as crypto and stock prices implode.
The Bitcoin bears are back and they are mauling the bulls mercilessly. BTC traders saw continued downside pressure after the 5.5% drop in BTC price on March 7. Increased odds of more interest rate increases by the Federal Reserve and regulatory pressure in cryptos explain some of the latest movements in the markets.
Financial markets showed some signs of stress as the inverted bond curve reached its highest level since the 1980s. Longer-term dated yields have stalled at 4%, while two-year treasury notes traded above 5% yield in March.
Since July 2022, longer-dated treasury yields have failed to keep pace with the surging two-year benchmark, resulting in the inverted curve distortion that normally precedes economic downturns. According to reports by Bloomberg, the indicator reached an entire percentage point on March 7, the highest level since 1981, when Fed Chair Paul Volcker faced double-digit inflation.
This week, BlackRock, the world’s biggest asset manager, increased its forecast for U.S. Federal funds to 6%. The chief investment officer of global fixed income at BlackRock, Rick Riede, believes that the Fed will keep interest rates significantly high for “an extended period to slow the economy and get inflation down to near 2%.”
Fear Of Crypto Regulation Grows
Based on a Wall Street Journal report, the Biden administration wants to execute the wash sale rule to cryptocurrency, which would put an end to a strategy where a trader sells and then instantly buys digital assets for tax purposes.
Additionally, the Public Company Accounting Oversight Board (PCAOB), an organization that keeps an eye on the audits of public firms in the United States, recently put out a stern warning to the investors about proof-of-reserves reports that auditing companies send out.
The organization, backed by the United States Securities and Exchange Commission (SEC), said that:
“Investors should note that PoR engagements are not audits and, consequently, the related reports do not provide any meaningful assurance.”
Here is a look at derivatives metrics to majorly understand how professional traders are positioned in the current market conditions.
Bitcoin Margin Markets Have Normalized
Margin markets offer insight into how professional traders are positioned since they enabled investors to borrow crypto to leverage their positions. For instance, one can increase exposure by borrowing stablecoins and buying Bitcoin. Borrowers of Bitcoin, on the flip side, can just take short bets against the crypto.
OKX stablecoin/BTC margin lending ratio. Source: OKX
The market chart indicates that OKX traders’ margin lending ratio plunged dramatically on March 9, moving away from a situation that previously favored leveraged long positions. Given the general bullishness of cryptocurrency traders, the current margin lending ratio at 16 is relatively neutral.
On the flip side, a margin lending ratio above 40 is quite rare, although it has been the norm since February 22. It is somewhat driven by a high borrowing cost for stablecoins of 25% per year. Looking at the recent anomaly, the margin market has returned to a neutral-to-bullish state.
Options Traders Are Considering A Low Risk Of Extreme Price Corrections
Traders must analyze options markets to comprehend whether the recent correction has made investors become increasingly risk-averse. The 25% delta skew is a major sign whenever arbitrage desks and market makers overcharge for upside and downside protection.
This indicator compares similar call (buy) and put (sell) options and will turn positive when fear becomes prevalent since the premium for protective put options is higher than the premium for the risk call options.
In general, in case the traders expect a Bitcoin price drop, the skew metric will surge above 10% and general excitement have a negative 10% skew.
Bitcoin 60-day options 25% delta skew: Source: Laevitas
Although Bitcoin failed to break the $25,000 resistance on February 21 and then experienced a 14% correction in 16 days, the 25% delta skew remained steadily in the neutral zone for the last month. The current positive 3% skew indicates a balanced demand for the bullish and bearish option instruments.
Derivatives data indicates that professional traders are unwilling to go bearish, as evidenced by options traders’ neutral risk assessment. Moreover, the margin lending ratio shows that the market is improving as some demand for the bearish bets has come up, but the structure currently remains neutral-to-bullish.
Considering the massive downside price pressure from a macroeconomic standpoint, and continuing regulatory pressure in the United States, the bulls maybe should be content that Bitcoin derivatives have remained strong.
Bitcoin crashes through US$22,000 floor as failure of Silvergate crypto bank hits market
Bitcoin fell below the US$22,000 support line in Thursday morning trading in Asia, with Ether and most other leading cryptocurrencies losing ground after U.S. crypto bank Silvergate said it will voluntarily liquidate. The bank has teetered on the brink of insolvency for weeks, becoming another victim of the FTX exchange collapse last November. Solana led the losers among the top 10 cryptocurrencies by market capitalization and the total industry capitalization fell under US$1 trillion. XRP rose. U.S. equities closed mixed on Wednesday, unnerved by the prospect of interest rates moving higher than expected this year.
- Bitcoin fell 2.34% in the past 24 hours to US$21,729 as of 09:00 a.m. in Hong Kong, according to CoinMarketCap data, bringing its loss for the last seven days to 8.06%. However, the biggest token by market capitalization is still up more than 30% for the year so far after a strong start to 2023 following the slump last year amid crypto industry bankruptcies and scandal.
- Ether, the second-largest cryptocurrency, fell 1.99% to US$1,535, bringing its weekly loss to 7.55%. Though, like Bitcoin, it’s holding gains for the year so far, up 28%.
- Solana led the losers, falling 8.86% to US$18.49 to post a seven-day loss of 17.49%
- XRP continued its upward trend despite the Silvergate Bank woes in the broader market, rising 2.69% to US$0.39. Stuart Alderoty, the chief legal officer of XRP-powered crypto payment network Ripple Labs, tweeted on Wednesday that the court supported some of Ripple’s defenses in the lawsuit brought against the company by the U.S. Securities and Exchange Commission. “We have always felt confident about our case and with each ruling, even more so,” said Alderoty in the tweet. The token gained 2.50% over the seven-day period.
- Shiba Inu dipped 0.55% in the past 24 hours, but still managed to unseat Litecoin as the 10th largest non-stablecoin cryptocurrency by market capitalization. The price of the meme token briefly surged on Wednesday, following an announcement that Shibarium – a Shiba Inu layer-2 blockchain for Web3 and gaming — will launch its beta version this week.
- Silvergate Capital Corp. announced on Wednesday it intended to shut down its operations and liquidate Silvergate Bank, a California-based lender that served the crypto industry, due to the mounting financial losses and regulatory investigations it faces.
- The total crypto market capitalization dropped 2.26% in the past 24 hours to US$995.70 billion. Total trading volume over the last 24 hours dipped 0.43% to US$44.50 billion.
- U.S. equities traded mixed on Tuesday. The Dow Jones Industrial Average closed 0.18% lower, the S&P 500 edged up 0.14%, and the Nasdaq Composite Index rose 0.40%.
- Federal Reserve Chair Jerome Powell told Congress on Wednesday that the central bank has not decided on the size of the interest rate hike expected at the bank’s meeting later this month, but will assess the latest economic data on inflation first. Powell said on Tuesday that steeper interest rate hikes might be needed to reduce inflation, sparking a sell off in U.S. equities the same day.
- U.S. job data released on Wednesday suggests inflation remains entrenched, with private employers adding 242,000 jobs in February 2023, beating the Reuters expectation of 205,000, according to a report by Automatic Data Processing.
- The Fed has raised U.S. interest rates eight times since March 2022, with the current rate between 4.5% to 4.75%, the highest since October 2007. Analysts at the CME Group expect a 21.4% chance that the Fed will raise rates by another 25 basis points this month. They also predict a 78.6% chance for a raise of 50 basis points, an increase from 69.8% on Wednesday.
Crypto Strategist Who Predicted May 2022 Bitcoin Crash Says One Top-Five Altcoin Set To Plummet by Over 80%
A widely followed crypto analyst who predicted the Bitcoin (BTC) crash in May 2022 says that Binance Coin (BNB) is on the verge of collapsing.
Pseudonymous crypto trader Capo tells his 697,100 Twitter followers that the giant crypto exchange’s native token BNB is likely to plummet by more than 80%.
“Adding the last part to the BNB short, average entry: $265. Main target remains $40-$45. This is a swing trade with very low leverage, not financial advice.”
Source: Crypto Capo/Twitter
Looking at Capo’s chart, he predicts BNB to first plummet to the $125 to $135 price level, followed by a collapse to the $40 to $45 price level heading into June.
At time of writing, BNB is changing hands at $258.
Capo also continues to predict that Bitcoin will soon dip this year by more than 28% from its current value to a low of $12,000, after trading sideways in the mid to high $16,000 range.
“$16,600, $16,800, $16,600, $16,800, $16,600, $16,800… And when you least expect it… $12,000.”
In looking at Capo’s chart, he predicts Bitcoin will dip to $12,000 and altcoins by 50% to 60% before the spring. Per his chart, once bottoming Bitcoin will likely rally to exceed $20,000 heading into May.
“A chart is worth a thousand words.”
Source: Crypto Capo/Twitter
He also says any near-term rally by Bitcoin will act as a bull trap, similar to the price action of 2022.
“It takes a tiny pump into resistance to turn everyone bullish again. This same bull trap has been happening during the entire 2022, yet people don’t learn. $12,000 is very likely.”
Source: Crypto Capo/Twitter
At time of writing, Bitcoin is changing hands at $16,856.
Generated Image: Midjourney
Trader Who Called Bitcoin Crash Says BTC Could Easily Rally to $160,000 – Here’s His Timeline
A crypto analyst who nailed Bitcoin’s (BTC) collapse last year predicts a massive surge for the king crypto.
The analyst known in the industry as Dave the Wave tells his 131,900 Twitter followers that based on his logarithmic growth curve (LGC) model, Bitcoin could ascend to $160,000 by January 2025.
“On the basis of the LGC, which has stood the test of time for four years, BTC could easily do a 10x over the next couple of years…”
Source: Dave the Wave/Twitter
The LGC model is the analyst’s attempt to predict the cycle highs and lows of Bitcoin amid changing macroeconomic conditions.
According to the crypto strategist, the LGC and his prediction remain valid as long as Bitcoin stays above the support of the model on a multi-month basis.
“As to when the LGC could be invalidated by future price – a multi-month close significantly below the base curve as it’s a macro model.”
Dave the Wave also says the LGC model continues to track the price action of Bitcoin despite the gloom and doom surrounding the crypto markets.
“So far, the base of the BTC LGC has proven to be the best support of price.
The increasing real correction of the cycles [23% – 38% – 50%] is implicit in the chart from a year back…
Breaking? Confirming rather.”
Source: Dave the Wave/Twitter
He also believes the baseline of the model will continue to act as support just as the top of the LGC served as resistance during the last bull market.
“The previous ‘bubble’ is effectively ‘popped.’ It is quite something else in the aggregate. Where the speculative excess culminates in a series of punctuated peaks, the corrections serve to provide a baseline of sorts, with this baseline representing a logarithmic growth curve.”
At time of writing, Bitcoin is changing hands for $15,507, a fractional dip on the day.
BTC Loses 15% Weekly, Will $20K Hold or is Another Crash Imminent? (Bitcoin Price Analysis)
The instability of Circle’s USDC has caused extreme fear in the market, as stablecoins play a crucial role in the cryptocurrency industry. Bitcoin’s price was affected by the recent turmoil and has declined, but it faces a strong support level.
The Daily Chart
Recently, the price of Bitcoin experienced a downtrend with noticeable bearish momentum after forming a reversal three-drives pattern and breaking down the neckline. The recent turmoil with USDC served as a catalyst for the bearish trend and pushed the price down toward the $19K level.
However, the price faces significant support at the 200-day moving average, approximately at $19.6K, and is attempting to surpass it. This moving average is a powerful support level, and the bears might find it difficult to push the price below it.
Despite this, the daily timeframe suggests that bearish momentum has weakened, and a short-term consolidation stage may occur before the next impulsive move.
The 4-Hour Chart
The price of Bitcoin has experienced a massive decline after breaking the critical support level of $22K, resulting in consecutive big red candles. However, every impulsive trend requires a cool-down phase, along with a correction.
Bitcoin appears to have entered the mid-trend correction stage after reaching a decisive price level at $20K. This level also serves as sentimental support. Additionally, the 61.8 level of the Fibonacci retracement for the recent bullish trend aligns with the $20K level of support, making it a substantial level.
Therefore, the price may consolidate in the current region, forming a correction pattern before trending lower.
The cryptocurrency market has once again entered a stage of fear and uncertainty due to the recent turmoil with Circle and the failure of SVB bank. As a result, market participants have capitulated and rapidly sold their assets to manage their risks.
The Funding Rates metric provides insight into traders’ sentiment and has recently declined impulsively, coinciding with a shakeout in Bitcoin’s price. Traders must be careful and monitor the perpetual market closely in case of another sudden price move.
Despite this, the market may become highly volatile with no specific direction in the upcoming days.
Crypto Analyst Says Bitcoin in a Do-or-Die Situation, Warns of Crash if Vital BTC Support Level Crumbles
A popular analyst is warning that Bitcoin (BTC) is at a critical moment and may crash if the top crypto asset fails to maintain support at a key price level.
Pseudonymous analyst Cred tells his 548,200 Twitter followers that a “do-or-die” moment has arrived for Bitcoin.
He says if the king crypto cannot hold the $19,000 to $20,000 price range the asset may plummet to the $16,000 range, a more than 15% drop from its current value.
“Some colloquial BTC thoughts: Market looks rough – range high rejection, big inefficiencies below us.
$19,000-$20,000 last and only technical structure as a do-or-die punt.
Any acceptance below there would bring yearly open/range lows into play. Meme the monthly all you want, it’s A+.”
Bitcoin is trading for $19,922 at time of writing.
Fellow crypto analyst Benjamin Cowen is predicting that it may take another six months before Bitcoin turns bullish again and, until then, its price will chop around.
“The time to flip macro bullish on crypto is probably in about six months. Until then, apathy is likely going to set in for a lot of people. Your job is to not lose sight of the bigger picture, even when it feels like the cryptoverse is crashing around you.”
He warns that the crypto markets may deliver big losses to both bears and bulls before a sustained move to the upside kicks in.
“In 2023, we get both the bears and the bulls rekt. The bears got rekt in January and February, giving the bulls a false sense of security. Once both sides are sufficiently rekt, then and only then can we go back up.”
Bitcoin Burst to All-Time High ‘Perfectly Feasible’ in 2023, According to Analyst Who Predicted Major BTC Crash
An analyst who accurately called the big crypto crash of May 2021 says that Bitcoin (BTC) going to its all-time high this year is not completely off the table.
Pseudonymous analyst Dave the Wave, who also predicted BTC recovering from the bear market near the $20,000 level, lists four reasons why a BTC rally up to its high at around $69,000 in 2023 is not an unreasonable expectation.
“A move to push previous BTC all-time highs this year is perfectly feasible:
– less steep rate of appreciation
– plenty of time, equal to the decline
– only midway on the logarithmic growth curve channel
– 25% of the way there already”
Source: Dave the Wave/Twitter
The analyst specializes in using logarithmic growth curves (LGCs), which aim to map out Bitcoin’s long-term fair value throughout cycles of volatility to the upside and downside. Ever since June of 2022, BTC has been in the “buy zone” of Dave the Wave’s LGC. He notes that it bodes well for Bitcoin that price has been ranging in his “buy zone” for over eight months now.
“Perhaps a positive to see BTC price in the LGC buy zone for a lengthy period…
The ‘easy’ money will be had by those who build a position [if not already long], rather than those who try to trade the short-term volatility.
Of course, this involves time… and of course involves the LGC model, which if held should always be hedged.”
Source: Dave the Wave/Twitter
While many investors fear current macro conditions and their potential impact on the crypto markets, Dave the Wave says they are largely irrelevant to technical analysis.
At time of writing, Bitcoin is trading at $22,367.
Why Bitcoin’s Price Crashed to $22.2K in Minutes: Analyst
While Bitcoin’s decline comes a day after Silvergate Bank revealed operational challenges, some seem to think that the nature of the crash was far too quick for it to be a direct result of the turmoil.
Indeed, the 5-minute chart reveals that the 5% crash happened in no more than 20 minutes.
Source: Binance, 5m
- The move caused a considerable tick in the liquidations, which are currently standing at around $243 million across the board for the past 24 hours.
- And while the crash comes shortly after Silvergate Bank revealed a lot of operational challenges and many crypto companies abandoned ship, the nature of it seems off.
- Intra-day trader and creator of delta-based trading systems 52Skew took it to Twitter to clarify the reason for this particular crash.
BTC – well, no sharp squeeze up but sharp margin cascade here.
What led to this move is a large binance spot sale directly into an area of stacked up longs.
$BTC well no sharp squeeze up but sharp margin cascade here.
What led this move is a large binance spot sale directly into an area of stacked up longs.
Margin call pic.twitter.com/bkYRfCzkjS
— Skew Δ (@52kskew) March 3, 2023
Bitcoin bears gain as bulls fight for support; Will BTC crash below $23k?
Bitcoin (BTC) has recorded a string of losses recently, with bears struggling to gain control over the maiden cryptocurrency’s price trajectory. Bitcoin has plunged below $24,000, which for now has invalidated the asset’s ability to reclaim $25,000 as the next support level.
Amid the uncertainty, senior analyst Jim Wyckoff highlighted that Bitcoin bulls still have the overall technical advantage. In his February 28 analysis, Wyckoff pointed out the bulls’ power has been fading, although it might only last for a while.
With Bitcoin’s momentum stalling partly due to refreshed anxiety around the United States macroeconomic outlook, the analyst acknowledged that the maiden crypto needs sustained buying pressure to reclaim previous highs.
“Bulls still have the overall near-term technical advantage as a price uptrend is in place on the daily chart, but just barely. Bulls have faded recently and need to show fresh power soon to keep the uptrend alive and to keep their technical edge,” he said.
Bitcoin searching for support
Currently, Bitcoin is attempting to sustain support above $23,500, with $24,000 acting as a significant resistance level. Consequently, crypto trading expert and analyst Michaël Poppe highlighted some of Bitcoin’s next key positions to look out for.
In a tweet on February 28, Poppe pointed out Bitcoin can be lined for gains if it flips the $23,800 support.
“My thesis stands that I’m not interested until we’ll flip and break $23.8K for support. After the harsh rejection, it seems like we’ll have a period of consolidation in a relatively boring week. In that case, areas around $22.5K entry,” he said.dd
Bitcoin’s latest correction follows the February 27 release of the U.S. Durable Goods Orders data for January. The figure indicated a drop of 4.5% translating to worry among investors about the possibility of inflation and interest rate hikes. The concerns have emerged despite robust economic data.
Bitcoin price analysis
By press time, Bitcoin was trading at $23,528 with weekly losses of about 3.7%.
Interestingly, as February ends, Bitcoin is trading above the $20,254 value for the end of the month set by the crypto community on CoinMarketCap.
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