Bitcoin could face a potential “liquidation cascade” towards $50,000 as BTC price rally thwarts analysis
Popular trader Credible Crypto has a gloomy short-term outlook for Bitcoin (BTC) bulls in his latest market commentary on X.
BTC Price Analysis Warns That ‘Range Bottoms’ Could Return
The BTC price has risen by about 40% since its August low, but the market has recently been struggling to sustain its uptrend.
According to data from Cointelegraph Markets Pro and TradingView, BTC/USD is down 1% on August 27, down from the local high of $65,100 recorded the previous day on Bitstamp.
For market participants, the writing is already on the wall, with some arguing that buyers are not well positioned to sustain the short-term uptrend.
“Binance wants blood,” Credible Crypto told X followers.
“Our top Coinbase spot takers in the region have actually started buying again, but Binance spot takers are selling 2x as much. OI is still pretty high and there is a lot of liquidity below that.”
Credible Crypto noted open interest on the world’s largest exchange Binance’s Bitcoin futures market along with spot market sell-offs.
“If Binance sellers continue to exert selling pressure, this could trigger a liquidation cascade back down to our lower range (which I expect as I have made clear over the past few days, but the question right now is how long it will take for this to happen),” he concluded.
Fellow trader Crypto Chase is equally skeptical that the uptrend will continue.
In his latest trading strategy update sent to his X followers, he envisaged a profit potential of $60,000 or less.
“If we lose cleanly above 59K, I think we’ll get back to the mid-50K range, or even lower,” he summarized.
Crypto Chase acknowledged that the situation could still turn bullish, and late bids within that range are likely to remain unfilled.
Bitcoin ETF Inflows Increase Bullish Bets
From a macro perspective, we focus on the potential for Bitcoin and cryptocurrency markets to outperform the overall recovery of risk assets.
Related: Will the BTC Price Drop End in September? 5 Things to Know About Bitcoin This Week
Trading firm QCP Capital argues that the future holds a pleasant surprise for crypto bulls, thanks to the potential for US monetary policy easing in the form of interest rate cuts.
In a recent announcement to its Telegram channel subscribers, QCP pointed to the continued strong inflows into US spot Bitcoin exchange-traded funds (ETFs) as a sign of overall market health.
This is in contrast to the net outflows from newly launched spot ether (ETH) ETF products, the report noted.
“BTC spot ETFs have seen strong inflows for 12 consecutive days, while ETH spot ETFs have seen outflows for 8 days,” the report said.
“BTC’s dominance in the options market reflects the macro nature of the current rate cut regime.”
This article does not contain any investment advice or recommendations. All investment and trading moves involve risk, and readers should conduct their own research when making decisions.