Major cryptocurrencies, including Bitcoin (BTC) and Ethereum (ETH), saw a significant drop as $170 million in long positions were liquidated in one hour, according to data from CoinGlass. This hurt investors who had bet on the prices of both cryptocurrencies to rise further.
The liquidations were dominated by BTC and ETH investors, with $65 million and $52 million in long positions liquidated, respectively. BTC plummeted below $60,000 late on Tuesday and has dipped by 6% in the past 24 hours. Meanwhile, ETH crashed below the crucial $2,500 level, down over 8% in the past 24 hours. Other cryptocurrencies, including Solana (SOL), Dogecoin (DOGE), Cardano (ADA), Toncoin (TON), and Polkadot (DOT) also registered notable drops.
Bitcoin (BTC), Ethereum (ETH) Register Sharp Drops
Bitcoin (BTC) pushed above $63,000 on Friday following reports that Federal Reserve Chair Jerome Powell was preparing for an interest rate cut next month, pulling the price of other altcoins higher as well. However, the price dropped sharply following the liquidations, dampening the market’s mood. The traditional stock markets mainly traded flat for the day, with analysts not finding any specific trigger for the drop.
Some analysts pointed to the recent state of Bitcoin price movements achieving equilibrium, with one report from CoinGlass noting that it might precede a period of heightened volatility. Meanwhile, Fairland Strategies suggested that BTC could be in for a difficult September, pointing to several factors indicating potential weakness. Fairland Strategies stated in its report,
“We are entering a seasonally weak period in September for risk assets broadly. A correction usually impacts the most volatile assets the hardest, albeit temporarily. “There are now minor signs of upside exhaustion per the DeMARK Indicators, and once the daily stochastics turn below 80%, it would increase the risk that support (~$56,500) is retested.”
BTC And ETH Lead Liquidations
The crypto markets witnessed over $313 million in liquidations on Tuesday as BTC dipped below $60,000. Long traders bore the brunt of these liquidations, sustaining 90%, worth $282 million. This is significantly more than the $31 million in short liquidations. Ethereum(ETH) liquidations were the highest, with over $100 million, of which $93.5 million were liquidated in long positions. As a result, ETH dipped below the crucial $2,500 price level and still hasn’t recovered. BTC was a close second with over $94 million in liquidations, with its open interest also registering a considerable drop. Open interest refers to the number of unsettled long and short positions in the market, with a drop suggesting increased liquidations or a cautionary approach from traders.
Trends Suggest Difficult September For BTC
With Bitcoin (BTC) witnessing a drop towards the end of October, market watchers are hoping for better prospects in September. However, historical data suggests that September has not been kind to the world’s largest cryptocurrency. BTC has ended September in the red eight times in the past 11 years and struggled even during highly bullish years such as 2013, 2017, and 2021. However, BTC could break the trend this year, with the US election as a potential catalyst.
Many have predicted that the US election results could significantly impact the price of BTC. Another catalyst for a potential increase is the possibility of a rate cut in September, as hinted by the Federal Reserve during the Federal Open Market Committee meeting. Looking ahead, October has been a traditionally strong month for BTC, with prices registering an increase in nine out of the past eleven years.
Bitcoin (BTC) Price Analysis
Bitcoin (BTC) saw a wave of liquidations late on Tuesday, leading to a substantial drop in price. This hurt traders who had bet on the asset’s price to increase following the Federal Reserve’s announcement of a rate cut in September. However, the liquidations have dampened the optimism around BTC, which has dropped over 6% over the past 24 hours. As a result, the price has dipped below the crucial $60,000 price level once again, with buyers struggling to establish a foothold.
As we can see in the price chart below, BTC had been in an upward trajectory as the previous week drew to a close, rising by 3.50% on Wednesday before a slight drop on Thursday as the 50-day SMA came into play, allowing sellers to push BTC down by just over 1%. However, bulls took control on Friday, with BTC registering an increase of 5.97%, pushing above the 50- and 200-day SMAs to settle at $64,032. In fact, BTC reached a day high of $65,054, but sellers pushed the price back below $65,000, a level they were expected to defend vigorously.
Source: TradingView
The weekend saw buyers and sellers struggle to take control, with BTC only managing a marginal increase on Saturday. Sunday saw buyers attempt another push towards $65,000 while sellers tried to drive the price below the 200-day SMA. However, neither could establish control, and BTC remained at $64,085. The current week began with BTC dipping below the 200-day SMA after a 1.85% drop as sellers tightened their grip on the market. As a result, BTC dropped to $62,903. Bearish sentiment intensified on Tuesday as markets crashed, with BTC dropping by 5.40% to slip below the 50 and 20-day SMAs and the $60,000 price level to $59,506. The current session sees BTC remain in the red, down by 0.50%, as sellers look to drive the price lower.
With Tuesday’s reversal, sellers have established control in the market, with any move above $64,000 ruled out for the time being. With September historically being a difficult month for BTC, it could drop further should sellers remain in control. Buyers will attempt to regroup and reclaim the $60,000 level, which is crucial to resume a push back above the moving averages and move towards $64,000. Should sellers continue to dominate, BTC could drop to the $58,000 support level.
Ethereum (ETH) Price Analysis
With the crypto markets experiencing a significant drop last night, Ethereum (ETH) tumbled below the crucial $2,500 level, dashing hopes of a push toward the $2,850 support level. The overall crypto market has registered a drop of almost 8% since the week began, with major cryptocurrencies spending a third consecutive day in the red. ETH recorded almost $100 million in liquidations, resulting in an almost 9% drop in the past 24 hours, wiping out the gains made on Friday.
ETH had jumped by 5.36% after pushing above the 20-day SMA as buyers successfully broke above the $2,700 price level despite strong selling pressure. Sellers attempted to regain control on Saturday, pushing ETH down from its day high of $2,820. However, buyers prevented a drop below $2,700, with ETH instead registering a marginal increase to end the day at $2,769. Sellers took control of the market on Sunday, pushing ETH down by 0.75% to $2,749.
Source: TradingView
Bearish sentiment intensified on Monday as ETH lost the $2,700 level after a drop of 2.42% and fell to $2,682. The late-night crash on Tuesday took ETH below the 20-day SMA and the crucial $2,500 support level as the price crashed over 8% to $2,458. Sellers pushed ETH to a low of $2,397 before buyers clawed back to $2,458. The current session sees ETH marginally down as sellers attempt to drive the price lower while buyers look to reclaim the $2,500 level. ETH’s price has struggled to recover since the August 5 market crash and now stands at a crucial juncture.
If sellers retain control and push ETH lower, it could drop to the $2,200 support level. Buyers must reclaim the $2,500 level for a recovery to occur and prevent further decline.
Solana (SOL) Price Analysis
Solana (SOL) mirrored the markets, spending the week in the red and dipping below $150 and the moving averages. SOL entered the weekend on a highly positive note, surging over 7% on Friday, pushing above the 20 and 200-day SMAs, and reclaiming the crucial $150 price level to settle at $153. SOL continued to push higher on Saturday as well, rising by almost 5% to go above $160 and settling at $160.78. However, sellers lost steam on Sunday, as sellers took control and drove SOL back below $160 to settle at $159.10.
Source: TradingView
Buyers attempted a recovery on Monday, as SOL rose to a day high of $162. Despite starting strongly, SOL lost steam at higher levels as sellers took control and pushed the price down by 1.18% to $157.22. The price remained bearish on Tuesday, dropping below $150 and the moving averages after a 6.55% drop and settling at $146.92. The current session sees SOL remain in the red, down by 1.35% and trading around the $144 mark. So, where does SOL go from here? Sellers will look to drive the price below $140. Should this happen, it would indicate that sellers have established control in the market. On their part, buyers will look to defend the lower levels and reclaim $150 to resume the push to $160.
Dogecoin (DOGE) Price Analysis
Dogecoin (DOGE) slumped with the rest of the markets, wiping out the gains made during the previous week, as bears drove the price below the $0.100 support level. DOGE lost momentum after hitting $0.112 on Friday after an increase of 6.52%. However, the price was rejected at the 50-day SMA, leading to a marginal drop on Saturday. DOGE also remained bearish on Sunday, registering a drop of 2.41% to settle at $0.109. The current week began with bearish sentiment intensifying, with DOGE dropping by almost 4% to $0.105.
Source: TradingView
The late-night crash on Tuesday dragged DOGE lower as it lost the $0.100 support level, dropping to $0.098 after a nearly 6% decline. The current session sees DOGE marginally up as buyers attempt to reclaim the $0.100 support level. If they are successful, DOGE will look for an initial push up to $0.105, where the 20-day SMA could act as resistance. A break above this level will see buyers attempt to reclaim $0.110. However, should sentiment remain bearish, DOGE could drop to $0.095 or even as low as $0.090.
Bittensor (TAO) Price Analysis
AI-related tokens have been on an upward trajectory, with investors turning to them in anticipation of Nvidia’s earnings report, which is set to be released this week. One such token is TAO, which had been quite bullish until the weekend. In fact, TAO registered significant jumps of 7.89% on Thursday and 8.08% on Friday to surge towards $350. With sellers active at this level, TAO dropped on Saturday, falling by just over 2% to $338. However, it quickly recovered, registering a jump of 3.13% on Sunday despite strong selling pressure and considerable volatility as sellers attempted to lower the price.
Source: TradingView
The current week began with TAO in the red, dropping by 3.34% to $337. Buyers attempted a move above $350 on Tuesday, with TAO reaching a day high of $364. However, with the broader crypto markets witnessing a decline, TAO fell in the red, and sellers yanked the price down by 7.23% to $313. TAO hit a low of $303 before rebounding from the moving averages to settle at $313. The current session sees buyers and sellers vying for control. Sellers attempted to push TAO below the moving averages and $300, but with strong demand at lower levels, TAO could recover and climb to its current level of $312. If buyers can retain control, we could see the price push back towards $350.
FET Price Analysis
FET has registered an incredible 40% increase over the past 7 days, surging above $1 to hit $1.35 on Sunday. However, its momentum has waned this week, with sellers dragging the price down since Monday and buyers struggling to establish a foothold during the ongoing session. FET has been bullish since August 19 and registered an incredible 18.73% increase on Friday to push above the 50-day SMA and settle at $1.20. Bullish sentiment prevailed over the weekend as well, with FET registering a 4.98% increase on Saturday and an even more significant increase of 7.74% on Sunday to settle at $1.36.
Source: TradingView
However, FET also faced considerable volatility on Sunday as sellers attempted to push the price down to $1.10, an attempt buyers could thwart. Despite ending the weekend on a hugely positive note, FET fell into the red on Monday, dropping by 2.12% to $1.33. Buyers attempted a recovery on Tuesday, pushing FET to a day high of $1.47, but lost momentum, allowing sellers to drag the price back down. As a result, FET dropped by 3.59% to $1.28, with sellers firmly in control. The current session sees buyers and sellers vying for control. FET dropped to a day low of $1.18 but has since recovered thanks to lower-level demand and is currently trading at $1.28.
If sellers retain control of the ongoing session, they will attempt to drive FET towards $1.10. However, buyers are expected to defend this level, and the price could rebound from the 50-day SMA. If buyers regain control, we could see FET attempt another move towards $1.50.
Polygon (MATIC) Price Analysis
Polygon (MATIC) has plummeted almost 12% over the past 24 hours after losing a crucial support level and dropping below the 20 and 50-day SMAs. MATIC, which had been quite bullish during the previous week, pushed above the $0.55 resistance level on Saturday, rising to $0.57 after a 6.12% increase. However, buyers lost steam as selling pressure intensified at upper levels. As a result, the price dropped over 8% on Sunday, slipping back below $0.55 and settling at $0.52.
Source: TradingView
MATIC remained in the red on Monday as well, starting the week on a bearish note after dropping by 4.19% and settling at $0.50. With the crypto markets crashing late on Tuesday, MATIC dropped over 7% on Wednesday, slipping below the 50-day SMA and a crucial support level and settling at $0.46. The current session sees the price down by 3.43% and below the 20-day SMA. If MATIC remains bearish, we could see sellers drive the price down to $0.40, a support level buyers are expected to defend. A rebound from this level could start a relief rally, leading to a climb back to $0.50.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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