Bitcoin's sharp drop triggers liquidations for 100,000 investors, heightening crypto market panic.

TraderKnows
TraderKnows
a day ago

The Bitcoin price has sharply retreated to $68,895, falling below a critical support level, causing massive liquidations among leveraged speculators and heightening market panic.

Recently, the cryptocurrency market has witnessed another wave of volatility, with Bitcoin and other virtual currencies experiencing a significant correction, triggering widespread market concerns. Bitcoin once reached a high of $73,622 last week, but it has since continuously declined, currently down to around $68,895, marking a retracement of approximately 6.4% from its previous high. This drop not only broke the key support level of $70,000 but also sparked panic in the cryptocurrency market. The sharp price drop, which was beyond market expectations, caused many leverage traders to "liquidate," with over 100,000 people suffering heavy losses within 24 hours.

Apart from Bitcoin, other cryptocurrencies such as PIXFI, TOMI, and CARV also saw substantial declines, exacerbating the wave of panic selling in the market. Analysts pointed out that the previous strong rise in Bitcoin was related to several stimulating factors, including Trump overtaking in the polls, which had driven Bitcoin's rise. Trump promised that if he returns to the White House, he would strongly support cryptocurrencies and even consider designating Bitcoin as a strategic reserve asset for the US. This promise made Bitcoin a part of the "Trump trade."

However, the latest Forbes poll shows that Harris is currently slightly ahead, which may lead some market funds to start withdrawing from Bitcoin, impacting the short-term trend of cryptocurrencies. Yardeni Research holds a different view, believing that even if Harris wins, Bitcoin will not see a long-term decline, and cryptocurrencies may exhibit a "buy the rumor, sell the news" pattern of volatility.

Additionally, this week's Federal Reserve rate decision will also affect market sentiment. The related stocks in the cryptocurrency sector and the stock market have recently shown weak performance, with digital currency concept stocks and Bitcoin ETFs in the Hong Kong market both declining. Since November, New Fire Technology Holdings (01611.HK) has fallen by 6.64%, OSL Group (00863.HK) has dropped by 1.52%, and Bitcoin ETFs, such as China Asset Bitcoin ETF (03042.HK), BOCHK Bitcoin ETF (03008.HK), and CSOP Bitcoin ETF (03439.HK), have all seen declines exceeding 4%.

As election day approaches and cryptocurrency volatility intensifies, investors need to closely follow market trends and lay out strategies with caution.

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