Bitcoin's price fell to $62,000 today, but a partial recovery during the day pushed it back above $65,000.
The cryptocurrency market saw sharp sell-offs over the weekend. Bitcoin briefly rose above $66,000 today after falling as low as $62,006 on HTX. Ethereum recovered to around $1,830, Solana to $72, and XRP to $0.96. Despite this, CoinMarketCap data shows weekly losses of approximately 14% for Bitcoin, 18% for Ethereum, 19% for Solana, and 17% for XRP.
Why Did the Cryptocurrency Market Fall?
The sell-off came after a week in which expectations of a US interest rate hike strengthened, technology stocks declined, and money continued to flow out of spot Bitcoin ETFs. US producer inflation rose 0.3% month-on-month in October, reaching 6.5% year-on-year. On Friday, CME FedWatch data indicated that the probability of a 25 basis point rate hike at the Fed’s December meeting was priced at around 90%. The Nasdaq fell 0.9% that same day. NVIDIA shares also dropped 2% following the departure of founder and CEO Jensen Huang.
On the crypto front, spot Bitcoin ETFs have recorded net outflows for seven consecutive trading days. According to Farside Investors data, approximately $1.91 billion flowed out of the funds during this period, with $1.07 billion of that occurring in the five trading days of last week. When US stock markets reopen on Monday, one of the first things to watch will be whether buyers have returned to the funds after the weekend’s decline.
93% of Liquidations Occurred in Long Positions
CoinGlass’s 24-hour measurement today shows that approximately $2.06 billion worth of positions were liquidated in the cryptocurrency market. Of this, approximately $1.92 billion came from long positions and $142 million from short positions. According to the data, more than 329,000 investors experienced liquidations. The largest single transaction was the closure of $16.17 million worth of positions on Binance’s ETH/USDT market.
As Bitcoin fell, leveraged long positions reached their margin limits. Exchanges automatically closing these positions created new sell orders in the futures market. Thus, the price drop triggered further liquidations, and forced selling accelerated the decline.
What Data Do Analysts Look At When Analyzing Sales?
Anchorage Digital research director David Lawant showed in a chart shared today that selling pressure is also evident in the spot market. Between November 9-14, the volume of sell trades on Coinbase’s major Bitcoin trading pairs exceeded buy trades by approximately 8,900 BTC. The largest difference among the four exchanges Lawant compared was observed on Coinbase. Wellington-Altus strategist James E. Thorne, in his weekend assessment, attributed the acceleration of the decline to the closing of leveraged positions. According to Thorne, for Bitcoin to confirm the bottom formation on the chart, it first needs to reclaim $73,000 and then surpass $87,000. A drop below $57,000 would invalidate this scenario.
Critical Hours for the FED and NVIDIA in the New Week
On Monday at 8:00 PM, Federal Reserve Chairman Kevin Warsh will speak at the opening of the San Francisco Federal Reserve’s productivity and employment conference.
NVIDIA’s earnings report is expected around 00:20 on Tuesday night/Wednesday morning. The company’s results meeting will begin at 01:00. Following Jensen Huang’s departure, investors will be watching for messages from interim CEO Colette Kress regarding chip demand and the upcoming quarter.
The minutes of the Fed’s October meeting will be released on Wednesday at 10:00 PM.
*This is not investment advice.
