Massive Liquidations Rock Bitcoin Market Amid $500M Wipeout

A wave of panic is sweeping through the crypto market. While Bitcoin was soaring close to $100,000, it fell below $96,000 this Sunday, November 24, 2024, before bouncing back. This event, accompanied by massive liquidations of over $500 million, shakes the confidence of investors and raises questions about the underlying dynamics of the market.

Large liquidations and bearish pressure

After several days of ascent to historical peaks, the Bitcoin faced a marked reversal, dipping below $96,000 to $95,996, but thanks to a rapid rebound, it currently stands at $97,917 at the start of this week. This pullback was accompanied by massive liquidations affecting nearly 200,000 positions. Among these losses, the “long” traders were the most affected, representing $383 million of the $500 million liquidated in total.

Observers also point to technical signals that hinted at an imminent correction. The TD Sequential indicator, used to detect trend reversals, issued a sell signal on the 12-hour Bitcoin chart. “If this correction is confirmed, Bitcoin could slide towards critical thresholds at $91,583 or even $85,610,” noted Ali Martinez, global information officer at BeInCrypto. Such movements illustrate how volatility remains inherent to this market, even during periods of general increase.

Geopolitics and macroeconomics : unavoidable influences

This decline is not just a simple story of charts. Geopolitical tensions play a significant role in this dynamic. Furthermore, the recent escalation of hostilities in the Middle East, marked by Iran’s statements regarding Israel, has heightened market nervousness. In times of crisis, investors tend to favor traditional safe-haven assets like gold and shun riskier assets such as Bitcoin.

Macroeconomic events in the United States add another layer of complexity. The sustained strength of the labor market and speculation surrounding further interest rate cuts by the Federal Reserve continue to shape investor expectations. Historically, accommodative monetary policy has supported Bitcoin, but current uncertainties are dampening that momentum. These combined factors amplify volatility and make short-term predictions more uncertain than ever.

Despite this retreat, Bitcoin’s fundamentals remain strong. History shows that correction phases, though feared, have often paved the way to new highs. However, observers show signs of confidence in the medium-term outlook, particularly as we approach 2025, where a combination of factors, including institutional adoption and seasonality, could rekindle interest in this asset. Nevertheless, for investors, caution is advised in an environment where risks, whether economic or geopolitical, are omnipresent. Bitcoin continues to captivate, but its abrupt movements remind everyone that its very nature remains unpredictable.