Originally published on: August 27, 2024
Bitcoin is on the verge of a potential “liquidation cascade” that could bring it down to $50,000, according to recent analysis. Despite a 40% increase from its August swing low, the BTC price has been struggling to maintain its gains.
Renowned trader Credible Crypto has shared a grim short-term outlook for Bitcoin bulls. Data from Cointelegraph Markets Pro and TradingView indicates that BTC/USD is facing losses, with some traders hinting at a possible drop below $60,000.
Credible Crypto pointed out that “Binance wants blood,” referring to open interest on the exchange’s futures market and spot market selling volume. The pressure from Binance sellers could trigger a liquidation cascade leading to a fall back to range lows.
Similarly, trader Crypto Chase predicts a drop below $60,000, should the key support level at $59,000 fail to hold. Despite the bearish sentiment, there is still potential for a reversal if late bids in the mid-$50,000 range remain open.
Looking at the bigger picture, the ongoing discussion revolves around the ability of the crypto market to outperform traditional risk assets. With the possibility of US financial policy easing through interest rate cuts, trading firm QCP Capital remains optimistic about the future for crypto bulls.
QCP highlighted the strong inflows into US Bitcoin spot ETFs, indicating overall market strength compared to outflows seen in Ether ETF products. This data suggests that despite short-term challenges, there is potential for bullish surprises in the crypto market.
This article serves as informative content and does not provide investment advice. Readers are encouraged to conduct their own research and due diligence before making any trading decisions. For more insights and updates on the market, subscribe to the Markets Outlook newsletter for weekly updates.