Bitcoin ($BTC) has dropped 8% to a nine-week low of $65,360 from Tuesday’s high of $71,300 amid increasing geopolitical risks surrounding the US-Iran war.
Key takeaways:
- Bitcoin slipped to $65,000 on Wednesday in a market-wide correction, liquidating $774 million in longs.
- Traders say Bitcoin needs to hold $60,000 as support to avoid a deeper correction in $BTC price.
Bitcoin wipes out longs in tumble to $65,000
Data from TradingView showed new $BTC price lows of $65,362 on Bitstamp, the lowest since March 29 as sellers stayed in control.
$BTC/USD daily chart. Source: Cointelegraph/TradingView
This extended the deviation from the local high of $82,800 to 21% and was accompanied by massive liquidations across the derivatives market.
Related: Bitcoin’s $224K ‘fair value’ may emerge if sovereign debt fears deepen: Bitwise
More than $1.58 billion in long positions were liquidated, with Bitcoin accounting for $774.2 million of that total. Ether (ETH) followed with $440 million in long liquidations.
Across the board, a total of $1.83 billion was wiped out of the market in short and long positions, marking the largest liquidation since Feb. 6, when $BTC price tanked to its multi-year low below $60,000.
Total crypto liquidations across all exchanges. Source: CoinGlass
“This marks one of the larger single-day events in recent months,” analysts at CryptoBanter said in an X post on Wednesday.
Pseudonymous analyst Byzantine General shared Velo data, which tracks liquidations from four major crypto exchanges: Binance, Bybit, OKX and Deribit, saying:
“Highest $BTC long liquidations event since the infamous October 10 black swan event.”
Bitcoin aggregate liquidations. Source: X/Byzantine General
Fellow analyst DonaX₿τ pointed out that the $1.5 billion in long liquidations recorded today were lower than the $1.6 billion posted during the Covid crash in 2020, adding:
“This industry is growing.”
Meanwhile, Bitcoin supply on Binance, the world’s largest crypto exchange by trading volume, has reached a three-month high of 659,000 $BTC.
This signifies a “potential for heightened selling pressure in the market, especially if it coincides with declining prices or increased volatility,” CryptoQuant analyst Arab Chain said in a QuickTake note on Wednesday, adding:
“Rising supply on exchanges can amplify price volatility and selling pressure, especially if inflows continue in the coming period.”
Bitcoin supply on Binance. Source: Cryptoquant
As Cointelegraph reported, Bitcoin is now in a fresh distribution phase fueled by increased inflows to exchanges amid extreme fear.
$60,000 is now Bitcoin’s last line of defence
$BTC swept lows around $65,000, leaving traders questioning where Bitcoin is likely to find support.
Bitcoin is in an “interesting zone” below $66,000 with bulls looking at the “area at $61K with the 200-Week MA for support,” MN Capital founder Michael van de Poppe said in a Wednesday post on X, adding:
“Those are important to be looking at crucial zones of interest for support and I’m sure that I’ll be going to accumulate more positions within this region.”
$BTC/USD weekly chart. Source: Michael van de Poppe
Analyst Colin Talks Crypto said the $65,000-$66,000 is “a reasonable support level for a short-term bounce,” with the possibility of the $BTC/USD pair later retesting the $60,000 support zone.
“Re-testing $60k is still highly likely. And breaking below it later this year is definitely not ruled out.”
$BTC/USD six-hour chart. Source: X/𝙲𝚘𝚕𝚒𝚗 𝚃𝚊𝚕𝚔𝚜 𝙲𝚛𝚢𝚙𝚝
As Cointelegraph reported, bulls are expected to defend the $60,000 level aggressively, as a break below it may plunge Bitcoin into a new downtrend.
This article is produced in accordance with Cointelegraph’s Editorial Policy and is intended for informational purposes only. It does not constitute investment advice or recommendations. All investments and trades carry risk; readers are encouraged to conduct independent research.
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