The Recent Crypto Market Liquidations
In the last 24 hours, the crypto market witnessed a staggering $1.57 billion in liquidations, marking the highest amount recorded since September 2021.
Bitcoin’s Impact on Liquidations
Bitcoin’s dip below $97,000 resulted in $1.39 billion worth of long positions being liquidated, with only $183.63 million in shorts. This imbalance highlights the overconfidence among traders who were anticipating Bitcoin’s price to surpass $100,000 in the near future.
Concentration of Liquidations
The liquidation heatmap from CoinGlass indicates a concentrated amount of liquidations around the $97,700 mark, suggesting that heavily leveraged positions were predominantly clustered in that range.
Critical Support Level
The cumulative long liquidation curve steepened significantly around the $97,700 level, emphasizing its importance as a critical support level for leveraged long positions. Once breached, it triggered cascading liquidations, intensifying the downward pressure that pushed Bitcoin below $97,000. In contrast, shorts had minimal impact, with their curve remaining relatively flat, indicating a lack of aggressive short positions at higher price levels.
Short Liquidations and Potential Recovery
Recent 12-hour liquidation data revealed a significant $91 million in short liquidations, occurring earlier during Bitcoin’s price surge before the subsequent drop. This suggests that some traders attempted to short the rally, only to be liquidated as the price briefly spiked before declining. The sharp decline in leveraged long positions at $97,000 hints at a potential short-term recovery as selling pressure eases.
