Correction initiated? By continuing to rise, the crypto market always ends up experiencing shortness of breath. A recurring dynamic causing significant losses following the triggering of cascading liquidations. Because buyers – often latecomers – in long positions are bearing the brunt of this type of trend break. And the last 7% drop recorded by Bitcoin will be no exception to the rule. Result: more than 300 million dollars liquidated in a few hours on the cryptocurrency market.
Crypto market: more than $316 million in liquidations in 24 hours
Waking up at the start of the week was difficult for the cryptocurrency market. Indeed, barely had Monday December 11 started before the Bitcoin accused a violent decline of -7% in the space of a few hours. With a price suddenly – but for the moment stealthily – projected towards the $40,500 level.
A situation for the moment stabilized above the $42,000. But the shock will still have led to a cascade of liquidation estimated at almost 100 million dollars just for long positions held on BTC.
We must then add to this approximately $75 million For Ethereum. With a total, all cryptocurrencies combined, of more than $316 million over the last 24 hours. And a record held by the OKX platform, with more than $168 million alone ($125.5 million for Binance).
A very sudden slowdown, which seems to have surprised quite a few investors positioned upwards with leverage. Because BTC in fact took the largest part of this decline (-5.5%). in less than ten minutes. There was no need for more…
When Bitcoin sleeps, altcoins dance?
However, many analysts call for calm. Because the current situation still seems to be under control, with upward objectives in the medium and long term which are not called into question.
The only true issue being, according to trader Michaël van de Poppe, the risk of a deeper correction in the currently illiquid altcoin market. But he anticipates, at the same time, an Ethereum which “should easily take over in the next quarter”. Could this be the announcement of the start of an altseason for early 2024?
At any rate, this correction is not really surprising. Because Bitcoin shows a regular increase, always above 145%, since the beginning of the year. But it seems important to remember that this path has never been in a straight line.
“The recent minor correction in the broader market is part of the rational profit-taking process as traders may have hit the price target at the end of the year given that BTC rose by over 70 % since October. »
Lucy Hu, analyst at Metalpha
This coming week could well fit into a trend of sustained volatility. Because, like theexplain the Kobeissi Letter account several important events must take place in the United States. For example, inflation data expected to be better than expected, unemployment figures presented as very positive. And finally the hope of Fed rate cut from the beginning of next year.
The recent drop in Bitcoin has just plunged the crypto market into a correction phase. A necessary step on the tormented path of BTC bullish trend to new heights. Because this does not call into question the promises contained in next year’s schedule.