The cryptocurrency market witnessed a volatile weekend as Bitcoin attempted a breakout above the $60,000 mark. However, the leading cryptocurrency faced strong rejection, triggering a surge in short positions across major exchanges. As of the latest data, Bitcoin (BTC) is trading at $58,515, down 1.7% from its recent high, with a market cap of $1.115 trillion.
Surge In Bitcoin Short Positions
The attempted rally above $60,000 was met with aggressive shorting activity, with 24-hour short volumes soaring by 118% to over $18.30 billion. This sudden increase in short positions reflects a bearish sentiment among traders who are betting against the cryptocurrency’s ability to sustain its upward momentum.
HODL15Capital, a prominent player in the crypto space, highlighted the imbalance across various exchanges, including Deribit, Bitmex, Bitfinex, Kraken, and HTX. The firm also pointed out that heavily leveraged positions on Binance, with leverage ratios of 50x and 100x, could soon face liquidation. This scenario raises concerns about a potential market shift if the price of Bitcoin continues to decline.
Broader market liquidation data reveals that more than $77 million has been liquidated in the last 24 hours. Of this, $50 million were long positions, while $26 million were short positions. Ethereum (ETH) led the liquidation tally, contributing $19.5 million to the total.
ETF Flows Fail to Ignite Bullish Sentiment
Despite the hype surrounding spot Bitcoin and Ethereum ETFs, inflows have remained subdued over the past two weeks. Last week, BTC ETFs recorded a net flow of just $32.5 million. The Grayscale Bitcoin ETF (GBTC) experienced significant outflows, totaling $195 million. In contrast, Fidelity’s FBTC saw the highest inflows at $82.3 million, followed by BlackRock’s IBIT, which recorded net inflows of $71.07 million.
Similarly, spot Ethereum ETFs saw net outflows of $1.416 million last week. BlackRock’s ETHA attracted $76.35 million in net inflows, while Fidelity’s FETH saw $25.79 million. Meanwhile, Grayscale’s ETHE faced substantial net outflows of $118 million. Some market analysts suggest that Ethereum ETFs could divert 50% of the inflows from Bitcoin ETFs, potentially impacting the overall market dynamics.
Looking ahead, all eyes are on the upcoming Federal Open Market Committee (FOMC) meeting and comments from Federal Reserve Chair Jerome Powell. The Jackson Hole annual meeting, a significant event for U.S. banks, is also on the radar of investors and traders.
Also Read: Bitcoin Plunges 1.63% As Market Cap Drops Below $1.2 Trillion
The outcome of these events could have a profound impact on Bitcoin’s price trajectory. Macro developments, especially regarding interest rates and monetary policy, will likely influence market sentiment and determine whether Bitcoin can regain its bullish momentum or continue to face resistance in the near term.
As the crypto market navigates these turbulent waters, investors should remain vigilant and closely monitor how Bitcoin reacts to these upcoming macroeconomic developments.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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