Bitcoin (BTC) attempted to reclaim $62,000 on August 3rd as the market rose slightly following a fresh liquidation trend.
BTC Price Tests Breakthrough of $60K Stock Sell
According to data from Cointelegraph Markets Pro and TradingView, the BTC price is rebounding 3% after hitting a multi-week low of $60,435 on Bitstamp.
It followed a gloomy day for global stocks, with the Nikkei down 6%, suggesting further losses on Wall Street. U.S. jobs data that fell far short of expectations added to the panic.
Bitcoin itself fell close to $5,000, losing several key support levels, including the short-term cost of ownership benchmark.
As a result, liquidations have increased, with $230 million worth of cryptocurrency long positions evaporating on both August 1 and August 2, according to data from monitoring resource CoinGlass.
“Yields are falling sharply as the US jobs report comes out surprisingly poorly,” Michel van de Poppe, founder and CEO of trading firm MNTrading, wrote in a response to X.
“There’s a bit of panic across the board as the market has priced in a significant U.S. recession.”
Van de Poppe argued that recent events have made it more likely that the Federal Reserve will cut rates at its next meeting in September, a key bullish catalyst for cryptocurrencies and riskier assets.
“One thing is certain: a September rate cut is a done deal,” he concluded.
The Kobeishi Letter, a trading material, summarized the macroeconomic situation as being full of mixed signals.
“The discussion yesterday was whether there would be a September rate cut. Today’s discussion is whether the cut will be 25 basis points or 50 basis points,” he explained in part of the latest X report.
According to CME Group’s FedWatch tool, there is a 78% market probability of a 0.25% cut that day.
Global liquidity signals Bitcoin bull run
Despite the market shock, the bullish outlook for Bitcoin remains intact.
Related: Bitcoin Whale Trading Volumes on Exchanges Hit 9-Year High as Analysts Call BTC Price Bottoming
Jeff Ross, founder and managing director of hedge fund Balesher Partners, suggests that increased global liquidity will drive future BTC price movements.
Ross uploaded a chart to X comparing the global M2 money supply to BTC/USD, as well as the 50-week and 200-week simple moving averages (SMA).
“An inverse head and shoulders formation on Bitcoin (weekly chart) in the setting of increasing global M2 money supply? Would be very bullish from a TA and liquidity perspective,” reads part of the accompanying commentary.
Cointelegraph reported that even before the full-scale crash, there was growing anticipation among investors that Bitcoin would retest the bottom of its long-term trading range.
Popular trader Daan Crypto Trades noted that “Bitcoin has been trading in this range for over 5 months now.”
“As the range progresses, we are seeing lower lows and lower highs. Key levels remain at $59K and $74K for lows and highs.”
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.