Bitcoin Slides by $3k as Bulls See Massive Liquidations

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The cryptocurrency industry is taking no breaks in its erratic moves. The past few weeks are testimony to this fact. Over the past few hours, Bitcoin (BTC)—and many altcoins—have recorded yet another erratic session, leading to significant liquidation across the board.

Reports show that about $400 million worth of both long and short positions have been liquidated on major exchanges. This happened as the benchmark cryptocurrency fell by about $3,000, before sharply recovering most of its losses. However, the cryptocurrency has slightly fallen again over the past few hours.

Out of the long and short positions liquidated, longs accounted for 86.5%, or $343 million. As one would expect, most of the liquidation came from the Bitcoin market. The exchange that recorded the most liquidation volumes is Binance, followed by Huobi, and then Bybit.

Many speculators have asserted that the recent drop was a bull trap, as the liquidation mostly favored bears. Over the past 24 hours, about $1 billion worth of liquidation has been recorded, 85% of which were long positions. In total, more than 108,770 traders were liquidated in just a day.

Nonetheless, the long-term prospects for BTC remain in favor of bulls. However, given the massive number of liquidations, it is obvious that the market is currently over-leveraged.

Key BTC Levels to Watch — January 15

BTC has suffered yet another sharp correction, after failing to reclaim the $40k round figure after several attempts. The cryptocurrency witnessed a heavy supply at $39,800, which triggered the drop.

However, it would appear that the $34,474 support has stepped up to the event, as it has prevented a steeper decline for the primary cryptocurrency in the meantime. Moving on, we expect to see Bitcoin receive some tailwinds over the weekend, with the mid-$38k as a target.

Meanwhile, our key resistance levels are at $36,500, $37,827, and $38,500. While our key support levels are at $34,474, $33,000 and $32,000.

Total Market Capitalization: $985 billion

Bitcoin Market Capitalization: $672 billion

Bitcoin Dominance: 68%

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