1. Potential Liquidations: 1.35 Billion Dollars
2. Liquidation Clusters and Their Market Impacts
3. Current Situation and Market Expectations

Bitcoin and altcoins are awaiting the critical US inflation data to be announced at 15:30 today. Significant liquidation thresholds that could increase market volatility are being discussed.

Potential Liquidations: 1.35 Billion Dollars

According to data from Coinglass, if the price of the largest cryptocurrency surpasses or falls below certain price thresholds, it could trigger sharp movements. According to the liquidation map provided by Coinglass, if the price falls below 55,000 dollars, the accumulated liquidation for long positions on major centralized exchanges could rise to 765 million dollars. Conversely, if the price exceeds 58,000 dollars, the liquidation for short positions on exchanges could reach 585 million dollars.

Liquidation Clusters and Their Market Impacts

As shown in the liquidation chart, the power of the liquidation does not represent the exact number of contracts awaiting liquidation or the precise value of contracts being liquidated. Instead, the bars in the chart reflect the relative significance of each liquidation cluster compared to neighboring clusters, essentially showing the strength or intensity of liquidation potential at specific price levels. In simpler terms, the chart provides a visual representation of the market impact if Bitcoin’s price reaches certain thresholds. The longer liquidation bars in the chart indicate that the market will experience a more intense reaction due to the increase in liquidations when Bitcoin’s price reaches these levels.

Current Situation and Market Expectations

The size of the liquidation clusters indicates a potential increase in market volatility. For instance, if Bitcoin’s price approaches the 55,000 level and triggers a 765 million dollar liquidation in long positions, the resulting sell-off wave could drive the price further down, reinforcing the initial decline. On the other hand, if the price exceeds 58,000 dollars and triggers a 585 million dollar liquidation in short positions, it could lead to an increase in buying pressure, pushing the price even higher. Liquidation events highlight the dangerous nature of leveraged trading, where price movements can trigger a series of liquidations, thereby intensifying market fluctuations. Investors often closely monitor significant liquidation levels to predict potential volatility and adjust their strategies accordingly. As the market awaits Bitcoin’s next major move, both bullish and bearish investors are preparing for significant price movements that could trigger major liquidations or create profit opportunities. At the time of writing, BTC is trading at 56,615 dollars, between the major liquidation levels.

As the market awaits the US inflation data, Bitcoin market players are preparing for significant price movements that could trigger major liquidations or create profit opportunities.