Bitcoin‘s value tumbled beneath the $61,000 mark, causing over $122 million in long position liquidations and raising concerns about the cryptocurrency’s stability. According to CoinGlass, within the last 24 hours, the significant liquidations of Bitcoin long positions amounted to more than $122 million. This downward movement increases the likelihood of Bitcoin plunging further, potentially slipping below the critical $60,000 threshold.
Notable Market Movements
Bitcoin’s sharp 5% intraday decline on June 24 led to these substantial liquidations. Over the past week, the world’s leading cryptocurrency has seen more than a 7% drop, based on CoinMarketCap data. This substantial dip has brought attention to the underlying asset’s fundamental price level, as futures positions often serve as key indicators.
Which Factors Are Influencing the Market?
CoinGlass data suggests that if Bitcoin drops below the $60,500 level, an additional $180 million in long futures positions across all exchanges could face liquidation. This recent plunge coincided with the announcement from the bankrupt exchange Mt. Gox, which plans to commence repayments to its users. Around $9.4 billion worth of Bitcoin will be distributed to approximately 127,000 creditors, potentially exerting substantial selling pressure on the market.
Implications for Traders
- Increased risk of further price drops below critical levels.
- Potential for substantial market selling pressure due to Mt. Gox repayments.
- Oversold conditions may signal a possible short-term recovery or continued volatility.
- Monitoring the Relative Strength Index (RSI) can provide insights into market momentum.
The market has also seen additional pressure from other significant movements, such as a wallet linked to the German government moving approximately 6,500 Bitcoin. This wallet has held close to 50,000 Bitcoin since February 2024, worth over $3 billion at current prices.
Result
Bitcoin’s price fell below $61,000, marking its most oversold conditions since it was valued at $26,000. The Relative Strength Index (RSI) on the daily chart dropped to 28, indicating oversold conditions. The last time the RSI fell below 30 was in August 2023, highlighting the current market stress and potential for continued volatility.