With an 11% rise in the space of 24 hours, Bitcoin (BTC) goes into bullrun mode and propels the cryptocurrency market into the green. Short term sellers have been trapped and are taking huge losses as BTC races towards final resistance at $25,200.
Bitcoin leads the rise
Even as the cryptocurrency market showed signs of weakening and sellers thought they were regaining the upper hand against buyers, Bitcoin (BTC) decided to print a meteoric rise of more than 11% in the space of 24 hours.
The Bitcoin price is currently trading around $24,600, and closed yesterday at $24,400, above its previous local high of February 2, 2023. This is the highest level we have seen in over 6 months.
Furthermore, Bitcoin is approaching the $25,200 mark, the previous high made in August 2022 following the huge crash in June. Breaking this level would be a very positive sign of an even stronger bullish extension.
For once, BTC has led the market, outperforming most altcoins. Ether (ETH) is up 8.7%, BNB is up 7.7%, Cardano’s ADA is up 5.2% and Polygon (MATIC) is up 9.7%.
Sellers participate in the rise
This week, investors were eagerly awaiting the announcement of the US Consumer Price Indices (CPI), a direct indication of the state of inflation in the country. On Tuesday, the market did not particularly flinch at the announcement of a rather moderate result.
So in the short term, sellers gradually took over from buyers with a long/short ratio that was largely in their favour. However, this created a huge pocket of liquidations in the $23,000 to $24,000 range on Bitcoin, which the market tends to go after.
In the continuation of the previous tweet, we can see that a lot of sellers have entered the game and that there is a big pocket of liquidation between 23k and 24k.
If we continue in this direction, the sellers will help us continue in this uptrend pic.twitter.com/7pmMU0KREQ
– Alan (@AlanTradingYT) February 12, 2023
In practice, many sellers took leveraged positions betting on the BTC price falling when it was at $22,000. Millions of dollars worth of positions were at risk of being liquidated if the price went the other way (up) and reached $23,000 and $24,000.
In 24 hours, more than $210 million in positions have been liquidated as a result of the sudden bullish move. In total, sellers accounted for 88.57% (or $187 million) of the liquidations.
Note that this type of massive liquidation by sellers often results in the market going up. Indeed, sellers must either liquidate their positions or buy them back to save themselves, thus helping to push the price even higher.