- CryptoQuant’s latest analysis indicates that Bitcoin could potentially drop to $40K, signaling a challenging period for investors.
Over $1 billion in crypto-tracked futures were liquidated in the past 24 hours.
Bitcoin tumbled more than 15% on Monday, briefly dipping below $50,000 amidst concerns of a US recession and growing geopolitical tensions in the Middle East.
This was the first time since February that BTC fell below this threshold before rebounding to around $52,000.
Experts suggest that the crypto asset could see more downsides.
More Pain for Bitcoin?
CryptoQuant’s latest analysis indicates that Bitcoin could potentially drop to $40,000, signaling a challenging period for investors.
#Bitcoin dropped over 16% in the last 24 hours, breaking below the $57K support level.
This breach suggests a possible drop to $40K.
Currently, traders are facing their most negative unrealized profit margins since November 2022. pic.twitter.com/gTWT52NO60
— CryptoQuant.com (@cryptoquant_com) August 5, 2024
The crypto analytic platform highlighted that traders are currently experiencing their most negative unrealized profit margins since November 2022.
This downturn reflects a significant shift in market sentiment, with increased selling pressure as traders seek to mitigate losses amidst an uncertain economic backdrop.
As a result of Bitcoin’s massive fall, the percentage of holders in profit dropped to 75%, as per IntoTheBlock’s observation.
As Bitcoin's price fell to $50k, the percentage of holders in profit dropped to 75%.
This level was last seen in January when prices formed a local bottom around $39k. pic.twitter.com/CAR5ju5VOR
— IntoTheBlock (@intotheblock) August 5, 2024
This is a significant decline and the lowest level seen since January, when Bitcoin’s price formed a local bottom around $39,000.
Bitcoin wasn’t the only asset affected by intense selling pressure. Ethereum was down by more than 22% over the past 24 hours, which dragged its price down to $2,264 at the time of writing.
During the same period, Solana and XRP were also down by over 18.2% and 16.6%, along with the rest of the market. Meanwhile, Dogecoin declined by over 20%.
Over $1 Billion Liquidated
The bloodbath triggered the liquidation of $1.08 billion in crypto-tracked futures over the past 24 hours. According to the data compiled by CoinGlass, $919.62 million long positions were liquidated, while short trades accounted for $162.45 million.
Bitcoin was hit hardest, seeing over $371 million in liquidations, with longs accounting for $310.26 million and shorts for $61.22 million.
Ethereum followed suit, with nearly $353 million liquidated during the same timeframe, including $303 million from longs and $49.6 million from shorts. Next up were Solana and Dogecoin, which also experienced notable liquidations, with $60.91 million and $13.14 million, respectively.
In the process, 283,280 traders were liquidated in the last 24 hours while the largest single liquidation order happened on Huobi for BTC-USD valued at $27 million.
The decline subsequently caused the crypto fear and greed sentiment index to indicate “fear,” reaching its lowest point since early July.
