Bitcoin’s Bullish Potential Clouded by $500M in Looming Liquidations
Bitcoin's current macroeconomic environment seems "ideal" for a breakout, yet the cryptocurrency faces potential instability due to over $500 million in upcoming liquidations.
According to Jamie Coutts, a leading analyst at Real Vision, Bitcoin’s mid-cycle correction aligns with historical patterns related to the global M2 money supply. Coutts highlighted that Bitcoin often bottoms out before the global liquidity bottom, then surges ahead of liquidity movements, leading to a mid-cycle correction.
Over the past decade, #Bitcoin has had a tendency to trough several months before the bottom in global M2. Then it rips, gets way ahead of the move in liquidity, and has a mid-cycle correction.
Now, momentum in global liquidity is starting to accelerate higher while all the… pic.twitter.com/0A9hV9m25h
— Jamie Coutts CMT (@Jamie1Coutts) August 13, 2024
Coutts’ assessment comes as Bitcoin rebounds from a recent $510 billion market sell-off that dropped its price to a five-month low of $49,500 on August 5. Despite the recovery, Bitcoin remains below the significant $60,000 threshold.
However, Bitcoin’s price could face a dip to around $55,000. Coinglass data suggests that a decline below $58,000 could trigger the liquidation of $489 million in leveraged short positions. If Bitcoin drops below $57,500, liquidations could exceed $800 million.
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Bitcoin at a Crossroads: Crash Ahead or Major Surge?Bitcoin is also struggling with a two-week downtrend, which began on July 28. Analyst Rekt Capital noted that overcoming this downtrend and achieving strong buying volume could be crucial for Bitcoin to regain upward momentum. Some analysts predict a potential drop to $55,000 before Bitcoin can potentially rise further.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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