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$33 Million Liquidated as Bitcoin Abruptly Drops 5% in 1 Hour, Traders Expect a Pullback

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  • Joseph Young
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    The Bitcoin price abruptly declined from $8,821 to $8,370 in less than an hour in a steep drop

$33 Million Liquidated as Bitcoin Abruptly Drops 5% in 1 Hour, Traders Expect a Pullback
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The bitcoin price abruptly declined from $8,821 to $8,370 in less than an hour in a steep drop as it slipped by more than 5%.

Some technical analysts including Josh Rager and DonAlt anticipated a hard rejection of bitcoin at key resistance levels at $8,450 and $8,800 when the bitcoin price initially recovered beyond $8,000.

The rejection was fueled by a cascade of long contract liquidations on margin trading platforms like BitMEX.

According to Datamish, on BitMEX alone, $33 million worth of bitcoin long contracts have been liquidated in the past several hours, building up sell-pressure on the market.

Bitcoin short liquidations on BitMEX
$33.75 million worth of bitcoin long contracts liquidated on BitMEX in the past several hours (image by datamish.com)

With momentum indicators suggesting a short term downtrend for the dominant cryptocurrency, bitcoin is likely to test lower support levels in a deeper pullback.

Why bitcoin is struggling to recover

From October 7 to October 10, the bitcoin price increased from $7,795 to nearly $8,700 in a strong recovery which many traders acknowledged as a short term trend reversal.

However, bitcoin lacked the momentum to break above important areas of activity and interest based on historical data such as $8,800 and $9,200, giving sellers more control over the market.

Bitcoin wants to see price stay above $8,450 or it's likely to break back down - $8,800 is still key area to break above But it seems like more and more people are talking about and big players in this market know what we're thinking and saying. Will continue to re-evaluate,” said Rager

Bitcoin is expected to face a larger pullback in the upcoming weeks, particularly because there are no certain near term factors that could act as a catalyst for a reversal.

Bakkt, for instance, whose launch has been highly anticipated throughout 2019 as a potential stimulus for bitcoin, is seeing a relatively low volume in its first month of operation.

On October 10, Bakkt said that it has reached a new record high volume of 212 contracts worth 212 bitcoin or around $2 million based on the price of bitcoin at the time.

Compared to other venues in the likes of CME’s bitcoin futures market and spot exchanges, a single-digit million dollar volume of Bakkt is unlikely to pose any noticeable impact on the price trend of bitcoin.

How low could the bitcoin price go?

A technical analyst known in the cryptocurrency market as “Dave the Wave” has said that based on previous corrections of bitcoin, $6,700 remains a possible medium-term target.

“A comparison of the corrections with the 3 year MA is interesting - price first pushes through, breaks above, then comes back to it for support. This lines up nicely with other factors suggesting a 6.7K odd target,” he said.

If the bitcoin price drops below the $7,000 region, from the bottom of 2019 at $3,150, it would be up by more than two-fold year-to-date, which could still establish a positive sentiment heading into 2020.

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About the author

Joseph Young is an analyst based in South Korea that has been covering finance, fintech, and cryptocurrency since 2013. He has worked with various recognized publications in both the finance and cryptocurrency industries.

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Ripple Once Again Tries to Toss Class-Action Lawsuit, Insists XRP Is Not a Security

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  • Alex Dovbnya
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    Ripple makes a final push to dismiss the damning class-action lawsuit ahead of a court hearing that is scheduled for January 2020

Ripple Once Again Tries to Toss Class-Action Lawsuit, Insists XRP Is Not a Security
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Ripple has once once again asked a federal court to dismiss the pending class-action lawsuit over selling illegal securities, a new court filing shows.

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The company reiterates the same "statue of repose" argument, which means that the plaintiffs failed to meet a legal deadline for filing the suit. Ripple started selling XRP to retail investors back in 2013, which means that it was way too late to bring legal actions against it back in summer 2018 after a bar to a lawsuit was imposed in 2016.    

The blockchain behemoth also continues to insist that XRP is not a security, but it called this issue "irrelevant" to their latest motion, which is why it didn't address this point in-depth. It's not the first time that Ripple tries to dodge the big question that is the cornerstone of the long-lasting legal battle. 

"XRP is not a security, but that is irrelevant for purposes of this motion. Even if XRP were a security, Plaintiff's claims still fail as a matter of law,” the filing said.   

Ripple's previous attempt to throw the suit out of the court didn't bode well. As reported by U.Today, Bradley Sostack, the leading plaintiff in the ongoing case, believes that the defendants are still liable for selling illegal securities. The parties are expected to duke it out in court in January 2020.  

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XRP's status as a security remains a point of contention within the cryptocurrency industry. Crypto influencer BitLord recently slammed Ripple for dumping their native tokens on investors to acquire businesses.    

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About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with an extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets.

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