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

  • Joseph Young
    🤷 Opinions

    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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Bitcoin in Danger as New Research Shows Google Has Achieved Breakthrough in Quantum Computing

  • Alex Dovbnya
    📰 News

    Google's quantum computer is still too primitive to pose a threat for Bitcoin's cryptography, but things could escalate quickly

Bitcoin in Danger as New Research Shows Google Has Achieved Breakthrough in Quantum Computing
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According to a new research paper published in science journal Nature, Google's quantum computer is able to perform calculations in just three minutes. To put this into perspective, it would take the fastest supercomputer about 10,000 years to perform the same operation, which signifies a major tech milestone for the search behemoth. 

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Google achieves "quantum supremacy"

Back in September, the Financial Times reported that Google has managed to achieve "quantum supremacy," which means that its beast is able to perform calculations that would be impossible to pull off with any other computer. 

However, technology is still way too fragile for commercialization, which is unlikely to happen anytime soon. There is hardly any practical application for quantum computers, but they do have great potential for disrupting a lot of industries, such as finance and transportation.   

Considering that the Trump administration has funneled a whopping $1.2 bln into the development of quantum computing, it might stop being just a buzz word. 

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Will Google's quantum success affect Bitcoin

There is also one notable application for quantum computing -- hacking Bitcoin. The headlines about Google's super-powerful juggernaut has made many wonder whether Bitcoin, whose value derives from the immutability of its Blockchain, is in danger. 

However, ex-Bitcoin Core developer Peter Todd reassured the confused crypto crowd that Google was nowhere near breaking the top coin's cryptography. On top of that, it's not even clear whether quantum computers could potentially be scalable enough for commercial use. 

Bitcoin evangelist Andreas Antonopoulos also opined that Google's quantum breakthrough would have no impact on the orange coin. 

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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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