The cryptocurrency market saw a significant increase in liquidations as bitcoin’s price dropped, mirroring a broader retreat from risk assets amid stock market declines.
Points
- Over $272 million in cryptocurrency liquidations occurred in the past 24 hours.
- Bitcoin led the liquidations, with $78 million liquidated, including $44 million in long positions.
- The stock market downturn, influenced by a weak U.S. jobs report, contributed to the sell-off.
- Analysts predict potential retests of bitcoin’s support levels and future price movements.
In the past 24 hours, the cryptocurrency market experienced a surge in liquidations as bitcoin’s price fell, mirroring a broader exit from risk assets. According to Coinglass, 81,838 traders were liquidated, amounting to $272 million across centralized exchanges. Bitcoin was the most affected, with $78 million liquidated, including $44 million in long positions.
The stock market also suffered, with the S&P 500 experiencing its worst session in nearly two years. A weaker-than-expected U.S. July jobs report fueled recession fears, causing the Nasdaq Composite to drop 2.9% and the Dow Jones Industrial Average to fall 863 points.
Bitcoin Could Retest the $62,500 Support Level
Analysts suggest that bitcoin might retrace to the $62,500 support level in the near future. BRN analyst Valentin Fournier noted that the market is in an accumulation phase, recommending reduced exposure due to a lack of major directional movement. Fournier also highlighted medium-term potential for bitcoin to break above the $70,000 resistance level as liquidity accumulates.
Fournier pointed out the influence of political factors on bitcoin’s performance, particularly the improving election odds for U.S. Vice President Kamala Harris. Investors are concerned about a potential anti-crypto stance from a Democratic administration, which could dampen the enthusiasm spurred by former President Trump’s pro-crypto promises.
Harris Improving Election Odds and Bitcoin
Betting sites now place Harris ahead of Trump in the presidential race, with PredictIt showing Harris as the favorite. Cryptocurrency investors are closely monitoring Harris’s strengthening odds, as a Democratic victory might lead to stricter crypto regulations, potentially affecting bitcoin’s price.
Bitcoin’s options market also indicates bearish sentiment, with the 25% delta skew showing higher implied volatility for out-of-the-money （OTM） puts compared to calls. This suggests that derivatives traders are hedging against further downside for bitcoin.
At the time of writing, bitcoin traded around $63,070, reflecting a market in flux as traders navigate the uncertainties of both crypto and traditional financial markets.
解説
- Market Correlation: The correlation between cryptocurrency and stock market performance is becoming more evident, with economic indicators and political events influencing both markets.
- Hedging Strategies: The use of options and other derivatives allows traders to hedge against potential losses, indicating a cautious market sentiment.
- Political Impact: Political developments, such as election outcomes, can significantly affect investor sentiment and regulatory expectations, thereby influencing market trends.