Anika Begay
In a bearish development for Bitcoin and the cryptocurrency market, the recent BTC price drop has triggered a massive liquidation of long positions. This negative incident that has caused broader pessimism in the entire market underscores the dangers of leveraged trading and the inherent volatility of the cryptocurrency market.
The Biggest Liquidation of Bitcoin Long Positions in 2024
The recent drop in the price of Bitcoin appears to be significant, as the decline has led to substantial losses in liquidation of long positions cited in recent data. Leveraged traders have seen their positions completely drained due to the drop in the price of BTC, triggering a series of liquidations.
Trader and all-round expert, Yonsei Dent shared the development of his recent research on the leading on-chain analytics platform, CryptoQuant. According to the expert, the massive liquidation recorded on Monday marks the largest since the beginning of 2024.
Yonsei noted that traders saw their positions wiped out after BTC took a sharp -30% decline from its previous short-term peak and a rapid decline of up to -16% in the past 24 hours in light of a global stock market crash. In particular, rising interest rates in Japan triggered the crash, which had an effect on other major markets such as US stock marketresulting in huge losses in the cryptocurrency sector.
Data shared by the expert revealed that the sudden move caused around 5,500 BTC long positions to be liquidated over the course of a day. And based on the hourly closing price, the liquidation is valued at around $303 million.
Yonsei also showed a sharp decline Bitcoin Open Interest (OI) following the recent decline. Major cryptocurrency exchanges such as Binance, Bybit, and OKX, which make up the majority of open interest, have seen a dramatic decline to nearly half of the overall interest.
At the time of posting, Yonsei stated that BTCThe price range was trending and found support between the January high of $48,900 and the February consolidation range of $51,000 and $52,000. However, if the price breaks below these support levels, it could jeopardize the price realized by Long-Term Holders (LTH).
While BTCThe bearish situation looks strong, there is optimism about an imminent recovery, as several bullish indicators have been cited on the asset’s chart, such as a bullish flag pattern.
BTC remains the main target among traders
Bitcoin may have taken a nosedive in recent days, but the cryptocurrency continues to be the main focus of traders in this troubled period, according to data from the famous market intelligence firm Santiment.
Santiment revealed that while BTC and Ethereal have sparked widespread interest in the cryptocurrency market, while other, more speculative coins that have been ignored by the masses are enjoying increasing success as the market recovers. For this reason, the platform advised investors to buy these speculative coins during the downturn, suggesting their potential to generate significant gains during times like this.
Featured image from LinkedIn, chart from Tradingview.com
