Bitcoin Skyrockets But Liquidation Concerns Continue

Bitcoin (BTC) moved closer to $55,000 on Monday, breaking through the $53,000 mark and rallying to $54,900 within the day, according to TradingView data. At press time, BTC was trading at around $54,700, about 21% lower than its all-time high of $69,000 in November 2021. As bulls take control, the cryptocurrency market capitalization reaches $2.09 trillion, up nearly 4.5% in the last 24 hours.

Caution Advised

As Bitcoin surged against short positions, analysts speculated about the key resistance levels ahead. Within a 24-hour period, the cryptocurrency market witnessed $158 million in Bitcoin short positions and $44 million in Ethereum short positions being wiped out. Binance recorded the largest single liquidation order, involving an ETH-USDT position valued at $10.38 million. In total, over $270 million worth of cryptocurrency shorts were liquidated.

The CoinGlass data cited by Crypto Rover, a cryptocurrency analyst, cautions that Bitcoin short positions totaling over a billion dollars could face liquidation if Bitcoin reaches $52,200. Ethereum also saw a surge, reaching a price of $3,273, a peak not seen since April of the previous year, which starkly contrasts with its record high in November 2021.

Uncertainty Looms

At the onset of the week, substantial liquidations hit investors in the cryptocurrency market who had placed bets against its upward trajectory. According to Coinglass, an on-chain data analysis tool, traders encountered $364 million in liquidations across platforms like Binance, Bybit, OKX, and Huobi. A significant portion of these liquidations were a direct result of Bitcoin short sellers.

The Bitcoin Fear and Greed Index, a gauge of market sentiment for cryptocurrencies, soared to a one-year high of 79 on the scale, a level not observed since Bitcoin experienced its all-time high price near $69,000 all the way back in November 2021.