As a seasoned crypto investor with over a decade of experience navigating the volatile cryptocurrency market, I find the recent analysis by “caueconomy” particularly intriguing. The massive liquidation event on October 1st, as highlighted by CryptoQuant, does indeed seem to be pointing towards a potential local bottom for Bitcoin.
According to an analyst named “caueconomy” from CryptoQuant, there’s a possibility that Bitcoin (BTC) has hit a temporary low in its price movement. This expert suggests that a substantial selling off or liquidation of positions might signal a potential short-term recovery ahead.
Despite Bitcoin experiencing a prolonged phase of pessimistic market conditions and technical signals hinting at possible future drops, the analyst pointed out that subtle indications might signal a recovery or stabilization in the cryptocurrency’s value.
How Is BTC Long Liquidations Suggesting Local Bottom?
The article “Local Bottom Establishment through Liquidation of Long Positions” by caueconomy on the CryptoQuant QuickTake platform explains how the process of liquidating long positions in the futures market might impact Bitcoin’s current pricing.
In times of significant price drops, long contracts purchased through futures markets often undergo steep decreases as a result of widespread sell-offs (or mass liquidations).
By doing this, it reduces the urge to sell, which can intensify price decreases. This could pave the way for an increase in the asset’s price over the short term.
On October 1st, approximately 4,000 Bitcoin long positions were terminated (also known as being “liquidated”), making it the second-biggest liquidation incident of 2024, according to statistics gathered by CryptoQuant.
The expert pointed out that major sell-offs like these could possibly signal a shift in market direction or the formation of temporary low points, since the market pressure from those sales decreases.
As a crypto investor, I always emphasize the importance of closely monitoring the purchasing power, as this can determine whether it has enough force to counteract the downturn and pave the way for a comeback.
The expert suggests that while the present level might hold steady for a while, further growth depends on increased buyer interest and market action.
The analyst concluded in the post:
For now, the price may continue within its current limits for a while, but keeping an eye on the buying power becomes crucial if we aim to reverse the recent downtrend.
Is there Any Sign Of Buying Interest In Bitcoin Currently?
Over the last day, Bitcoin has experienced a steady rise in value, registering a 3.5% growth and surpassing the $62,000 threshold once more.
Currently, the price of Bitcoin stands at approximately $62,238 per unit. This rise in BTC has led to an uptick in the entire cryptocurrency market. As a result, the total market capitalization of all cryptos has grown by 2% over the past day, reaching a value of about 2.26 trillion dollars.
Currently, a well-respected cryptocurrency analyst named Ali on X has signaled some ongoing Bitcoin purchasing activity on a particular exchange.
Earlier today, Ali noted an increase in the Taker Buy/Sell Ratio on OKX, which is the fourth-largest crypto exchange by daily trading volume. In simpler terms, he highlighted a significant rise in the number of trades being made to buy or sell cryptocurrencies on OKX.
On the OKX platform, there was a significant increase in the Bitcoin Buy/Sell Ratio. This suggests a strong wave of active purchasing, which could be a signal that an uptrend is imminent!
— Ali (@ali_charts) October 4, 2024
The surge in this ratio suggests a rise in the number of aggressive purchases happening in the market, potentially pointing towards a revival of positive movement. This type of trading pattern usually mirrors growing buyer confidence, implying a possible price rebound or the start of a new uptrend.
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2024-10-05 08:11