The crypto markets started the day’s trade having a major bearish influence after the latest interest rate cuts. The Bitcoin price plunged below $100K when the Fed Chair commented negatively on asking his opinion about the national Bitcoin reserve. However, the token has led a strong recovery as it rises above $102K in a short while suggesting the traders may have utilised yet another ‘buy at the dip’ opportunity. But what led to the downfall?
The liquidations play a major role in impacting the prices of cryptos, mainly Bitcoin. Ever since the token started to rise above $100K, the longs started accumulating heavily above $105K and extended to $107K. However, these were expected to close, which triggered a massive pullback. As per the data from Coinglass, the markets have witnessed over $782 million in liquidation in the past 24 hours, which may have slashed the prices hard. However, Bitcoin liquidity is still sitting above $102K, which may appear scary but eventually flashes a bullish signal in the long term.
Here the accumulation of longs at levels just above $102K suggests the price is about to experience a notable pullback after surpassing these levels. This could be the reason why the BTC price is facing a major hindrance in surpassing these levels. On the other hand, a huge pressure is being mounted here, which may compel the price to accumulate around this range. With this, there is the possibility of a short squeeze that may push the prices higher, probably above $110K.
On the other hand, the BTC dominance has displayed a major comeback by heading back to 60%. In the times when the dominance was expected to drop below 50%, the latest reversal above 58% suggests a major reversal could be fast approaching.
The levels have triggered a rebound and considering the previous price actions, the levels are believed to reach the upper resistance. This suggests the price is in the middle of the prevailing bull run and hence the next bullish wave could push the price towards new highs. However, as it happened earlier, a rejection may follow, triggering a fresh bearish wave across the markets, probably in the second half of 2025.
