Why could Bitcoin easily and quickly reach $100 000? But...
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Why could Bitcoin easily and quickly reach $100,000 if it breaks out of this sideways trend upwards? But...
Using various services like coinglass, it's possible to analyze different metrics, such as the liquidation map.
What is this and why is it important?
Liquidations are liquidity, and as we well know, the price moves from liquidity to liquidity. I'm sure you've often noticed how, after sharp and significant drops, the price quickly reacts and reverses. This is the moment when the price finds liquidity through the liquidation of a large number of market participants. In simple terms, it's like a magnet that will eventually attract the price.
What do we see right now? According to coinglass, at the $70,000 level alone, there are $20 billion worth of liquidation orders, and the same amount just slightly higher, at $71,500. These are potential liquidations of short-sellers (those betting on the market going down).
What happens when short-sellers are liquidated? When a short position is liquidated, a buy order is triggered automatically, which in turn pushes the price higher.
This long accumulation + liquidations can easily push the price up to $100,000 or even higher! And this could set the market trend direction for the next 4-6 months.
But...
If you've read the previous post, you know that the current trend is bearish (downward), and until that changes, a further decline is more likely. Importantly, according to coinglass, there’s a lack of liquidity below, all the way down to the $44,000 - $42,000 range, with a large pool of liquidity and liquidations at the $33,000 level. And where there is no liquidity and it's empty, there are no barriers, meaning the price could drop just as rapidly.
Additional thoughts:
As long as the downward trend continues, the probability of the price moving lower remains higher. However, since this downtrend has lasted for almost 200 days, there’s also a significant chance that the trend could reverse, and we could move upwards. So, we are currently in a rather interesting and uncertain spot, where the likelihood of going up or down is about 50/50. I’ll keep following my algorithmic trading systems!
Using various services like coinglass, it's possible to analyze different metrics, such as the liquidation map.
What is this and why is it important?
Liquidations are liquidity, and as we well know, the price moves from liquidity to liquidity. I'm sure you've often noticed how, after sharp and significant drops, the price quickly reacts and reverses. This is the moment when the price finds liquidity through the liquidation of a large number of market participants. In simple terms, it's like a magnet that will eventually attract the price.
What do we see right now? According to coinglass, at the $70,000 level alone, there are $20 billion worth of liquidation orders, and the same amount just slightly higher, at $71,500. These are potential liquidations of short-sellers (those betting on the market going down).
What happens when short-sellers are liquidated? When a short position is liquidated, a buy order is triggered automatically, which in turn pushes the price higher.
This long accumulation + liquidations can easily push the price up to $100,000 or even higher! And this could set the market trend direction for the next 4-6 months.
But...
If you've read the previous post, you know that the current trend is bearish (downward), and until that changes, a further decline is more likely. Importantly, according to coinglass, there’s a lack of liquidity below, all the way down to the $44,000 - $42,000 range, with a large pool of liquidity and liquidations at the $33,000 level. And where there is no liquidity and it's empty, there are no barriers, meaning the price could drop just as rapidly.
Additional thoughts:
As long as the downward trend continues, the probability of the price moving lower remains higher. However, since this downtrend has lasted for almost 200 days, there’s also a significant chance that the trend could reverse, and we could move upwards. So, we are currently in a rather interesting and uncertain spot, where the likelihood of going up or down is about 50/50. I’ll keep following my algorithmic trading systems!
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