Around $2.5 billion was liquidated across the crypto market in a mass rout that sent the price of Bitcoin back to the levels seen at the end of September. Bitcoin traded near $47,000 on December 4 after an abrupt crash confirmed the bulls’ worst nightmares with around 23% daily losses.
Data acquired from TradingView showed BTC/USD reaching local lows of $41,960 on Bitstamp, which is its lowest level since September 30. As a lot of panic set in, leveraged positions unwound and traders capitulated, after 24-hour cross-crypto liquidations passed $2.5 billion.
The co-founder of trading platform Decentrader, filbfilb, summarized in a fresh synopsis after the latest market move:
“$50k is likely to be resistance for a decent amount of time now unless stonks to incredible things. Size of dump & distribution likely to mean consolidation into Q1 next year. Moon mission is not dead but some will think cycle over.”
The scale of that dip wiped out some of the most important support levels, including the $1 trillion asset valuation for bitcoin that was previously a popular choice for the long bets.
According to previous reports, worries over traders’ behavior were present as recently as December 3, as data showed that the market might easily be overleveraged at past levels that had formed near $60,000. With that leverage now flashed out, optimism among familiar faces has remained. Some analysts are saying that the $42,000 spike is the ‘bottom’.
Another analyst added that Bitcoin is still in the bull market.
In the meantime, Bitcoin has managed to avoid an attack on the $40,000 support. That is something that might be a reason to ‘flip bearish’ in case it forms a weekly resistance, as highlighted by analyst TechDev. He told Twitter followers:
“Wait. Relax. The market will reveal. If cycle bull phase deviates substantially from history, expect any bear phase to do the same.”
Close week below 20W SMA (50.8) ➡️ Concerning
Macro LL on a weekly close (40K) ➡️ Flip bearish
Lose the 2W RSI Floor ➡️ Flip bearishWait. Relax. Market will reveal.
If cycle bull phase deviates substantially from history, expect any bear phase to do the same. https://t.co/6smUaIWlKY
— TechDev (@TechDev_52) December 4, 2021
Ethereum Maintains Strength On Bitcoin Pair
There is a small silver lining from Ether (ETH) on the day that neared a rematch of its highest level since mid-2018.
ETH lost less than Bitcoin in the crash compared to the dollar, ETH/BTC bucked this trend to pass 0.0831.
All of the top ten cryptos by market capitalization were down by more than 10% against the United States dollar, led by Polkadot (DOT) that had lost 21% at the time of writing.
