- Today, the price of Bitcoin dropped due to investors liquidating their long positions, resulting from excessively high funding rates, suddenly turning positive sentiment into negative.
- A popular analyst highlighted in a December 26 post that Bitcoin has been consolidating in a parallel channel since surpassing $40,000 in November.
- In the last 24 hours, 70,611 investors were liquidated, and the total liquidation amount reached $170 million, with $105 million belonging to long positions.
Bitcoin price faced a sharp decline on Tuesday: Can BTC experience further drops? This level will be critical!
Can Bitcoin Price Drop to $40,000?
Today, the price of Bitcoin dropped due to investors liquidating their long positions, resulting from excessively high funding rates, suddenly turning positive sentiment into negative. A popular analyst still predicts that BTC could drop to $40,700 if its price falls below the main support level.
A popular analyst highlighted in a December 26 post that Bitcoin has been consolidating in a parallel channel since surpassing $40,000 in November. This requires focusing on the critical support level of $42,400 to determine the price direction.
He anticipates that a continuous decline below $42,400 could pull the BTC price down to $40,700. On the other hand, a reaction from the support level could assist in the upward momentum towards $44,400. The crypto market saw the liquidation of $40 million in long positions in just one hour. In the last 24 hours, 70,611 investors were liquidated, and the total liquidation amount reached $170 million, with $105 million belonging to long positions.
Skew, a popular trader, revealed that a significant amount, “roughly sold for the price of 150-200 BTC,” was executed cleanly on Binance Spot. He suggests looking for quick scalp trades in strong altcoins if BTC and ETH can maintain their low levels.
BTC Under Pressure
Investors are expecting a Santa Claus rally this week, but there is also a critical event with the annual option expiration. Alongside this sentiment, the potential approval of a spot Bitcoin ETF by the SEC is on the agenda. Meanwhile, issuers of spot Bitcoin ETFs must file the changes by the specified date of December 29.
The price of BTC dropped from the 24-hour high of $43,765 and is currently trading at $42,740. Furthermore, trading volume increased by 38% in the last 24 hours, indicating interest among traders. This is happening as BTC’s weighted funding rate has risen significantly.
