Bitcoin continues its upward trend, floating above $60,000, building on the gains made on September 13. Buyers seem to have regained confidence following the U.S. Federal Reserve’s (Fed) decision to cut interest rates by 50 basis points on September 18.
Over $21 Billion in Bitcoin Shorts to Be Liquidated If BTC Breaks $70,500
As Bitcoin’s price climbs and trading volume surges, a notable market scenario is emerging. According to an analyst on X (formerly Twitter), if Bitcoin surpasses $70,500, over $21 billion worth of short positions could be liquidated. This observation is based on market data and Binance’s perpetual liquidation map.
BTC Liquidations if Bulls Break $70,500 | Source: @martypartymusic via X
Liquidation occurs in the perpetual futures market, where leverage traders try to profit from market volatility. Traders can either take long positions, betting on price increases, or short positions, expecting prices to drop. These positions are leveraged, meaning traders borrow funds from the exchange to increase their potential profits. The collateral, or margin, is used as security, and if the market moves against the trader, the exchange will forcefully liquidate the position to recover losses.
Bitcoin needs to rise by roughly 11% from current spot rates to reach $70,500. The next key level for liquidation lies around $66,000, which corresponds to the August highs. If Bitcoin breaks this level with increasing trading volume, it could trigger a rally that might push the price past the $70,000 to $72,000 resistance zone, unleashing a wave of liquidations.
Key Resistance Zone at $70,000 to $72,000 for BTC Traders
For Bitcoin bulls, breaking through the $70,000 and $72,000 resistance levels is crucial. Since June, Bitcoin has struggled to sustain a move above $72,000. However, a decisive close above $70,000 could trigger a short squeeze, which may push the price towards $73,800 or even higher, potentially leading to new all-time highs.
Recent data from Coinglass on September 19 shows that over $69 million in short positions were liquidated in the last 24 hours. At the same time, more than $13 million worth of long positions were also liquidated due to market volatility.
Bitcoin Liquidations | Source: Coinglass
Over 66,000 crypto traders were liquidated in the past day. The largest single BTCUSD position, worth over $8.9 million, was closed on Bybit, a perpetual futures trading platform.
As Bitcoin continues its upward trajectory, the potential for large-scale liquidations looms, with the $70,500 level serving as a key marker for what could be a significant market shift.
Source: NewsBTC.com
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