Bitcoin price fell below $65,800 on April 2 as leveraged bullish traders recorded losses of more than $130 million and BTC network fundamentals and major macro indices hinted at an imminent rebound.
On April 2, the price of Bitcoin fell to a ten-day low of $65,800, down 6% in a frenzied 12 hours. Can BTC recover before the upcoming halving event?
Why did Bitcoin price fall today?
Bitcoin price fell from $71,317 to $65,800 during morning trading hours on April 2 (GMT). The BTC market decline can be attributed to the Bitcoin ETF getting off to a negative start to the week, with net outflows totaling $85.7 million on April 1. Farside Investors, Grayscale’s GBTC led the outflow of more than $302 million.
While the Grayscale ETF outflow caused its size to plummet, the rapid liquidation of the derivatives market further accelerated the Bitcoin price decline.
Coinglass’ liquidation heatmap chart below visualizes the size and frequency of liquidations for various assets and within specific time periods.
As of this writing on April 2, more than 140,290 traders have liquidated $437.6 million in leveraged positions in the last 24 hours. In particular, long BTC traders were hit the hardest, losing over $133.7 million.
The bearish impact of this widespread liquidation culminated in a 6% price decline within a one-day period, but bulls are now incentivized to react with other measures to stem losses.
During consecutive market clearing periods, bullish traders can buy quickly to mitigate further losses, while short-term traders can begin to book profits, easing bearish pressure. Absent a deterioration in Bitcoin network fundamentals, this scenario could trigger an immediate BTC price recovery.
Whales hope for recovery before halving as Federal Reserve chairman eases recession fears
Bitcoin price fell 6% to $65,800 within a daily period on April 2, wiping more than $80 billion from its market capitalization within a daily period. However, BTC fundamentals, including network usage, remain stable and social sentiment remains broadly positive, indicating that the recent market downturn has been further deepened by a cascade of liquidations.
Federal Reserve Chairman Jerome Powell’s recent statement cooled recession fears and hinted at an imminent interest rate cut, a move that could trigger a quick recovery for BTC before the April 20 halving.
On Friday, March 29, Federal Reserve Chairman Jerome Powell reiterated that there is no reason to think the risk of a U.S. recession has increased.
There is no reason to think the economy is in recession or on the edge of a recession. We are in a place where the economy is strong. The labor market is in a good position.
– Jerome Powell, Chairman of the US Federal Reserve, March 29, 2024.
Confirming the bullish stance suggested by Jerome Powell’s bullish comments, BTC whales showed remarkable resilience amid turbulent market volatility on April 2.
As you can see above, this group of whales invested over $6.8 billion to acquire 100,000 BTC in the last 30 days, with their balance increasing from 11.7 million BTC to 11.8 million BTC between March 1 and April 1. .
In particular, the price of BTC plummeted on April 2 and has now fallen below the 30-day simple moving average (SMA) price of $68,171. However, interestingly, the chart above shows that despite being in a net loss position, BTC whales continue to make new acquisitions in hopes of a quick rebound.
If whales remain resilient, strategic retail traders may soon receive a signal to ease bearish pressure on BTC going forward.
Moreso’s positive outlook for the next non-farm payrolls (NFP) report due on Friday, April 5 could lead to a renewed increase in bullish activity in risk asset markets. This scenario could promote a bullish recovery phase prior to the halving.
Bitcoin (BTC) Price Prediction: Rebound to $75,000 Before Halving?
BTC whales, holding on to the $6.8 billion in new acquisitions and the Fed Chief’s positive comments, are all pointing to a rebound in Bitcoin prices above $70,000 before the halving.
However, to validate these bullish price predictions, BTC bulls must first avoid further declines below the $65,000 area.
As you can see below, 861,890 addresses earned 580,020 BTC at an average price of $64,726. If they hold their positions, Bitcoin could enter a recovery phase immediately.
Additionally, if the BTC price can get back to the $70,000 region, the market could be bullish once again. However, in this scenario, bears could form significant resistance in the $68,000 area in the near term.