Bitcoin’s Dip Below $63K Wipes Out $2.5B in Longs: When Will the Rout End?

Bitcoin has continued to fall despite a dovish Fed.

Man standing next to the price chart of Bitcoin, seeing them tumble into the ground.
Created by Kornelija Poderskytฤ— from DailyCoin
  • Several leveraged traders have been wrecked in Bitcoin’s recent dip.
  • Bitcoin has continued to fall despite a dovish Fed.
  • Analysts have weighed on whether the rout is likely to continue.

This week has been tough for the crypto community as crypto assets are back in the red following a short-lived weekend rally in a rout led by Bitcoin. As the market decline intensifies, several traders have been caught in the fall.

Bitcoin Leveraged Traders Get Wrecked

Many leveraged long traders have been wrecked in Bitcoin’s most recent dip. According to CoinGlass data shared by prominent crypto analyst Ali Martinez, over $2.5 billion in leveraged long positions were liquidated as Bitcoin today fell below the $63,000 price point from highs of nearly $65,000.

Many had anticipated that the Federal Reserve’s Wednesday, July 31, announcement of a potential rate cut as soon as September 2024 would help stem Bitcoin’s losses for the week, and even lead to a relief rally. This, however, has not been the case, with some analysts suggesting that the rate cuts had already been priced in and traders were “selling the news.” In contrast, others pointed to unrest in the Middle East as creating uncertainty that was weighing on the asset’s price.

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Still, the worst of the recent decline may be over, as several analysts are suggesting that Bitcoin is now out of the woods.

The End of the Dip?

Reacting to the recent price drop, The McClellan Market Report Editor Tom McClellan contended that the recent market correction was “about done.” The analyst expressed this view, citing the McClellan Financial Publication’s one-week leading indication model.

McClellan was not the only analyst to suggest that the market fall was over though. Prominent crypto trader “XO” marked out the $62,000 to $63,000 price range as a level to search for buys, citing Stochastic and RSI indicators, which suggested that the sell-off was losing steam.

According to the CoinMarketCap data at the time of writing, the asset has managed to pare some of its losses to trade just above the $63,000 price point. Ali Martinez warned that a bounce back to highs around $70,000 would equally wipe out leveraged short positions worth nearly $2.4 billion.

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This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Okoya David

David Okoya is a journalist at DailyCoin covering DeFi ecosystems and exchanges. David has moderate holdings in Bitcoin, and minor holdings in LINK, DOT, INJ, and memecoins.

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