Bitcoin sees most long liquidations of 2023 as BTC price tags $22.5K
BTC price downside volatility sees $46 million of long Bitcoin positions evaporate in a single day before the monthly close. 2006 Total views 32 Total shares Listen to article 0:00 Market Update Own this piece of history
Collect this article as an NFT Bitcoin (BTC) swapped bullish gains for chop into Jan. 31 as the end of the month saw nervous price action.BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView$46 million of longs liquidated
Data from Cointelegraph Markets Pro and TradingView tracked a less confident BTC/USD as it briefly wicked to just above $22,500 on Bitstamp overnight.
A rebound saw the pair flip $23,000 to short-term resistance, and was still trading below that level at the time of writing.
The stakes remained high for traders, long and short, with the monthly close just hours away. This was followed by interest rate decisions from the United States Federal Reserve on Feb. 1, along with the European Central Bank a day later.
With volatility likely lying in wait, liquidations mounted despite Bitcoin maintaining a fairly narrow trading range.
The trip to $22,500 sparked $46 million of long liquidations on Jan. 30, which according to data from Coinglass was the highest daily total of 2023 so far.Bitcoin liquidations chart. Source: Coinglass
Further data from on-chain analytics resource Material Indicators meanwhile highlighted the tense situation on the Binance order book.
Bid and ask liquidity remained in flux, with incremental shifts up and down having a tangible impact on BTC price trajectory. Bids just below $22,000 and asks at $24,000 kept BTC/USD in check.BTC/USD order book data (Binance). Source: Material Indicators/ Twitter
Its worth noting that this is the same block of bids that have been pushing BTC price for weeks and because its prone to move, could end up getting rugged, Material Indicators commented in a Twitter thread on Jan. 30.
Continuing, the analysis said that the location of the liquidity was no coincidence, singling out Bitcoins old all-time high from 2017 as a last stand support zone should current levels fail to hold.BTC/USD annotated chart. Source: Material Indicators/ TwitterCrypto traders stem dry powder” inflows
Catalysts for a Bitcoin and altcoin comedown had already been mounting at the weeks Wall Street open.
Related:Best January since 2013? 5 things to know in Bitcoin this week
U.S. equities lost ground on Jan. 30, with marketwide nerves over the Fed showing themselves in decreased risk appetite.
This was also conspicuous on crypto exchanges as stablecoin deposits cooled, reducing what one analyst called dry powder available for deployment into crypto assets.
Right now there is a negative correlation between price and stablecoin deposits. Of course, this is not the only one indicator which we need to check but Fed meeting will be held within this week and we also see this negative correlation, Kripto Mevsimi, a contributor to on-chain analytics platform CryptoQuant, summarized in a blog post. We can expect high volatility within this week however we need to be careful since there is not much dry powder coming into exchanges anymore.
An accompanying chart showed a divergence in stablecoin deposits relative to BTC/USD growth in the second half of January.BTC/USD vs. stablecoin deposits chart (screenshot). Source: CryptoQuant
The views, thoughts and opinions expressed here are the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph. #Bitcoin #Bitcoin Price #Markets Related News How to store Bitcoin on MetaMask How Bitcoin mining saved Africa’s oldest national park from bankruptcy LTC, AVAX, APT and FTM prepare to rally as Bitcoin price targets $24K Best January since 2013? 5 things to know in Bitcoin this week Bitcoin price pares weekend gains as another CME gap lurks below $20K
