As a crypto investor with some experience under my belt, I’ve seen my fair share of market volatility and sudden price drops. And this latest decline in Bitcoin’s price, triggered by a combination of factors, has left me feeling a bit uneasy.
Bitcoin (BTC) experienced significant downturn and dipped below the $61,000 mark, leading to the elimination of over $122 million in long positions. This substantial liquidation indicates a potential further decline towards the $60,000 threshold with BTC currently trading at $60,750.
In the 24-hour period leading up to 1:25 PM UTC on June 24th, data from CoinGlass indicates that over $122 million in long Bitcoin positions with leverage were liquidated. This occurred amidst Bitcoin’s significant one-day price drop of more than 5%, which also saw the cryptocurrency momentarily fall below the $61,000 mark.
Mt. Gox Repayments Add to Selling Pressure
As an analyst, I’ve observed a notable price decrease in the cryptocurrency market that occurred concurrently with news from the defunct exchange, Mt. Gox. This financial institution revealed plans to initiate repayments to its 127,000 creditors, who are owed a substantial sum of over $9.4 billion in Bitcoin.
An abundance of Bitcoin entering the market might put significant downward pressure on its price through increased selling. According to Eric Balchunas, a senior ETF analyst at Bloomberg, this could counteract the recent inflows into Bitcoin ETFs.
On June 19th, a digital wallet identified by the German government transferred approximately 6,500 Bitcoins, contributing to the market’s downward trend. This wallet has been in possession of roughly 50,000 Bitcoins since February 2024, equivalent to more than $3 billion using Bitcoin’s current price above $61,000.
Bitcoin’s RSI Indicates Oversold Conditions
As a researcher studying Bitcoin’s price movements, I observed that when its value dipped down to $61,000, its Relative Strength Index (RSI) suggested the cryptocurrency had entered the “oversold zone.” In the daily chart, I noticed that the RSI of Bitcoin reached a reading of 28 – the most oversold level since it was trading around $26,000 back in August of 2023.
As a crypto investor, I can tell you that a number of factors could potentially impact Bitcoin’s price trend in the near term. Specifically, the ongoing effects of forced liquidations due to leveraged positions, the repayment process from the Mt. Gox bankruptcy case, and heightened selling pressure from large-scale investors may continue to shape Bitcoin’s price movements in the coming days.
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2024-06-24 20:21