The Risk of Further Price Correction for Bitcoin
The bitcoin price has dropped below $39,000, which increases the possibility of a further price correction, according to Bitfinex analysts. Short-term holders are more sensitive to market fluctuations, making them more likely to react strongly to price changes. Critical support levels are currently at $38,000 and $36,000. The bearish sentiment is prevailing in the market, and the next crucial price levels for bitcoin that could provide support are estimated to be between $38,000 and $36,000.
Short-Term Holders’ Profit Decline
Bitfinex analysts have observed that over half of the profits accumulated by short-term bitcoin holders have been wiped out. Many holders who acquired bitcoin less than a month ago are now exiting the market at a loss. This indicates that bearish sentiment is affecting short-term holders more severely.
Market Volatility Leads to Liquidations
The heightened market volatility has resulted in total liquidations of leveraged crypto positions exceeding $330 million in the past 24 hours. The majority of these liquidations involve long positions, resulting in a loss of over $290 million. Short positions contributed around $39 million to the total liquidations.
Bitcoin Price Drops Below $39,000
In the past 24 hours, the price of bitcoin has fallen by more than 4.5%, dropping below the $39,000 mark. Currently, it is trading at $38,894. The significant drop in price reflects the prevailing bearish sentiment in the market.
Hot Take: Market Volatility and Short-Term Holders’ Risk
The recent decline in bitcoin’s price below $39,000 highlights the increased risk faced by short-term holders. Their sensitivity to market fluctuations makes them more vulnerable to substantial price corrections. With critical support levels at $38,000 and $36,000, it is crucial for short-term holders to carefully assess their positions and make informed decisions. The liquidations of leveraged crypto positions further emphasize the impact of market volatility on traders. As the market continues to experience fluctuations, it is essential for investors to stay updated and adapt their strategies accordingly.
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