The crypto market has finally entered the green zone, and major assets have reclaimed their crucial levels. Bitcoin is finally trading above $20,000, while Ethereum has surpassed the $1,500 range.
At the time of writing, Bitcoin is selling at $20,698 after an upswing of 2.02% over the last 24hrs and 8.18% in the last seven days. The King currency’s immediate resistance lies at $20,750, and the support is around $20,650.
Just a week ago, the situation was bleak. The spot market had lost its demand against the derivative market, and the main reason was an increase in leveraged positions. These leveraged positions attracted short sellers; hence, most market participants predicted a bearish cycle.
However, as Bitcoin surged immensely in the last two days, most of the leveraged short positions resulted in massive liquidation.
In the last 24hrs, more than 16,000 leveraged short positions have been liquidated.
How Will This Impact The Market Situation?
Amidst such high liquidation, Bitcoin’s estimated leverage ratio has increased, which suggests that investors are now choosing to go long.
It is often seen that whenever there is an increase in the leveraged positions, there is also an increase in the asset’s price volatility. A movement against the predicted direction will often lead to massive liquidation.
Meanwhile, when we look at Bitcoin addresses, it is observed that addresses with more than 100 BTC and addresses with more than 1000 BTC indicated a bull run for the last two days.
However, Bitcoin ETF and low demand by Bitcoin whales indicate that this upward momentum by Bitcoin might not go far. Also once investors began their move to take out profit, the flagship currency might yet again start its downward journey.
And as Bitcoin price approaches the overbought area, the selling pressure increases pulling down the price. Nevertheless this selling pressure is expected to occur beyond $22,000 trading level.
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Source: https://coinpedia.org/bitcoin/bitcoin-price-reclaims-20k-whats-next/