Bitcoin Drops to $62,000, $310 Million in Long Positions Liquidated
On August 1, Bitcoin experienced a sharp decline, falling from $64,000 to $62,800. According to Coinglass, this sudden drop resulted in the liquidation of long positions worth $310.27 million in a 24-hour period, wiping out a total of $337 million.
Over the past 24 hours, $77.07 million worth of long Bitcoin positions were liquidated, with $26.6 million of that occurring in the last four hours alone. The largest single liquidation involved an ETH-USDT swap worth $4 million on crypto exchange OKX.
Market analyst DW noted that despite the significant decline, the situation was not “extreme.” DW noted the current low liquidity in the market, which is amplifying the selling effects. DW cited ongoing concerns such as the unresolved Mt. Gox issue and seasonal low liquidity following the Bitcoin 2024 conference, which could amplify any selling activity.
In contrast, independent analyst Mags offered a more optimistic outlook. Mags emphasized that Bitcoin is still above a key moving average support, trading near the upper boundary of a descending broadening wedge. Mags also noted that the “hash strips” are giving a buy signal, indicating the potential for a recovery. According to Mags, the current price action resembles previous examples where the hash strips turned green, leading to significant upward movements after initial declines and consolidation.
Mags emphasized that these dips could present buying opportunities as long as Bitcoin’s price remains above $60,000. Historical analysis supports this cautious optimism, despite what has typically been a difficult August for Bitcoin. Data from Coinglass shows that Bitcoin’s average August return since 2013 has been around 2.24%, with the cryptocurrency closing negative in eight of the last eleven years, posting a median return of -6%.