Crypto Market Crash: The crypto market saw a sharp decline as $90 million in positions were liquidated in a few hours. The price of Bitcoin fell by more than 1%, while the price of Ethereum fell by almost 2% due to profits made by investors.
Top altcoins such as Solana (GROUND), BNB, XRP, Cardano (ADA) also fell 2-3% after a massive price rally over the past 24 hours. Meme Coins Dogecoin (DOGE) and Shiba Inu (SHIB) plunged 6% in one hour. Crypto market shows volatile developments ahead of US CPI and employment data.
While the crypto market looks extremely bullish following pro-Bitcoin Donald Trump’s victory in the US presidential elections, some data points to a potential crash.
Will the crypto and Bitcoin market collapse soon?
Data from Coinglass indicates that the crypto market saw $90 million in liquidation in 4 hours and $650 million in the last 24 hours. Notably, $75 million in long positions and $15 million in short positions were liquidated within hours, triggering a massive market sell-off.
On 217,000 traders were liquidated, with the largest liquidation order taking place on crypto exchange OKX, with one BTC-USDT swap trading valued at $15.56 million.
Bernstein Analysts gave a Bitcoin price target of $90,000 by the end of the year. BTC price hit a new all-time high of $81,858 today, indicating a bullish rally in the leading crypto. However, derivatives market data signals fears of a sell-off that could trigger a crypto market crash.
BTC Implied Volatility (IV) in all terms it is in sharp decline, especially BTC ATM-7 IV. Bitcoin At-the-money (ATM) implied volatility is a market’s prediction of a likely movement in the price of BTC. So, options traders do not see the price of Bitcoin rising further at the moment.
As a result, the prices of major cryptocurrencies such as Ethereum, Solana, XRP and Dogecoin fell and triggered a broader sell-off in the crypto market.
Moreover, Mount Gox moved over 30,371 BTC worth $2.44 billion to two wallets as of Monday, according to Arkham data. This has caused some concern among investors, as it usually implies that an exchange is planning to sell tokens soon. Mt Gox moved 2,500 BTC again on Tuesday.
Weakness in Bitcoin, ETH, XRP, DOGE due to macro factors
China’s latest stimulus measures amounting to 10 trillion yuan have disappointed investors, leading to a change in sentiment. Markets are bracing for initial volatility as Donald Trump’s administration is expected to make major policy changes.
Impending CPI and PPI inflation in the United States, along with jobless claims and Fed Chairman Jerome Powell’s speech this week, are impacting the crypto market. Economists expect inflation data to be higher and could impact the market amid political changes in the United States. Some BTC, ETH, XRP, and DOGE investors have experienced a pullback due to macroeconomic factors.
However, popular analysts are bullish on Bitcoin price in the long term, ignoring concerns related to the crypto market crash. Seasoned trader Pierre Brandt predicts a complex continuation of the formation of an inverse head and shoulders pattern that sets the BTC price target at almost $125,000 by the end of the year And $300,000 in the longer term.
It is important to note that despite the skepticism surrounding this trend, notable analysts such as Richard W. Schabacker, Robert Edwards, and John Magee have accepted this trend.
Varinder Singh
Varinder has 10 years of experience in the Fintech sector, with over 5 years dedicated to blockchain, crypto and Web3 developments. A technology enthusiast and analytical thinker, he has shared his knowledge on disruptive technologies in over 5,000 news stories, articles and documents. With CoinGape Media, Varinder believes in the enormous potential of these innovative technologies of the future. It currently covers all the latest updates and developments in the crypto industry.
Disclaimer: Content presented may include the author’s personal opinion and is subject to market conditions. Do your market research before investing in cryptocurrencies. The author or publication assumes no responsibility for your personal financial loss.
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