Bitcoin
Bitcoin drops 2%, but traders say it’s a healthy pullback before the next leg
Bitcoin drops 2%, but traders say it’s a healthy pullback before the next leg
Bitcoin (BTC) the price fell 2.12% the previous day following the news of Ethereum spot ETF approvals. This surprised traders who were optimistic about new all-time highs following the cryptocurrency’s strong rally earlier in the week, gaining 9% to $72,000. The sudden decline saw BTC fall from a high of $71,980 on May 21 to an intraday low of $66,606 on May 24.
Trader and analyst Mags suggested that the current correction in BTC could be a “fake,” which has been a recurring pattern for the cryptocurrency. Mags explained that Bitcoin tends to consolidate within a range for a few weeks or months, then break below that range, trapping bearish traders, before quickly recovering and continuing its upward movement.
Matthew Hyland, another analyst, pointed highlighted that BTC price is approaching a retest of the demand zone between $64,000 and $67,000, which represents the neckline of an inverse head and shoulders pattern. Hyland emphasized that Bitcoin successfully broke out of this pattern and closed a daily candle above it, indicating a bullish structure and potential resistance tests before reaching all-time highs.
Unfortunately, those betting on BTC recovering from current levels faced significant losses on May 23. During a 24-hour period, a total of US$227.51 million in leveraged positions were liquidated, with US$159.3 million belonging to long positions, according to to Coinglass data. In the last hour alone, US$46.75 million in leveraged BTC positions were liquidated, with US$39.6 million in long positions.