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Bitcoin’s Bullish Potential Clouded by $500M in Looming Liquidations

13.08.2024 18:45 2min. read Alexander Stefanov
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Bitcoin’s Bullish Potential Clouded by $500M in Looming Liquidations

Bitcoin's current macroeconomic environment seems "ideal" for a breakout, yet the cryptocurrency faces potential instability due to over $500 million in upcoming liquidations.

According to Jamie Coutts, a leading analyst at Real Vision, Bitcoin’s mid-cycle correction aligns with historical patterns related to the global M2 money supply. Coutts highlighted that Bitcoin often bottoms out before the global liquidity bottom, then surges ahead of liquidity movements, leading to a mid-cycle correction.

Coutts’ assessment comes as Bitcoin rebounds from a recent $510 billion market sell-off that dropped its price to a five-month low of $49,500 on August 5. Despite the recovery, Bitcoin remains below the significant $60,000 threshold.

However, Bitcoin’s price could face a dip to around $55,000. Coinglass data suggests that a decline below $58,000 could trigger the liquidation of $489 million in leveraged short positions. If Bitcoin drops below $57,500, liquidations could exceed $800 million.

Bitcoin is also struggling with a two-week downtrend, which began on July 28. Analyst Rekt Capital noted that overcoming this downtrend and achieving strong buying volume could be crucial for Bitcoin to regain upward momentum. Some analysts predict a potential drop to $55,000 before Bitcoin can potentially rise further.

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