The cryptocurrency market experienced significant turmoil in the past 24 hours, with liquidations exceeding $440 million. Ethereum and Bitcoin were the most affected.
Reasons for Liquidations in Cryptocurrency
According to CoinGlass, long positions in major cryptocurrencies such as Bitcoin and Ethereum were predominantly affected. Meanwhile, short-position liquidations were more common among mid-tier cryptocurrencies. The highest concentration of liquidaion activities was observed on platforms like Bybit and Binance.
Ethereum's Response to Market Fluctuations
Ethereum's value plummeted from over $4,700 to around $4,100, pulling its RSI indicator into a neutral position. Despite significant liquidation volumes indicating decreased purchasing strength, Ethereum's robust demand and blockchain activity provide a steadier medium-term projection than many other cryptocurrencies. Nonetheless, critical resistance stands at $4,040, defined by the 50-day exponential moving average, with a potential decline to $3,600 if selling pressures mount.
Bitcoin's Prospects and Other Cryptocurrencies
Bitcoin currently struggles to hold its ground after slipping below $118,000. Trading between $111,000 and $114,000, Bitcoin stabilizes at the 100-day moving average. However, if Bitcoin falters at the $110,000 mark, it risks dropping back to the $104,000 support level, posing another hurdle for investors. Major cryptocurrencies such as XRP and Solana did not escape unscathed, noting combined liquidations over $30 million in the wake of these liquidations. A decrease in leveraged trading across the market emphasizes the need for cautious risk management and anticipates ongoing volatility.
The extensive scale of liquidations presents critical points for consideration regarding market fragility and the necessity for careful risk management. Market players continue to reassess their strategies in light of the current instability.
