Bitcoin’s price dropped by 9% in the last 36 hours, going from $58.8k to $55.5k. It then rose by 6% to reach $56.8k at press time. Because of this volatility, a lot of crypto positions were closed, and long bets took the most damage.
There were several things that led to Bitcoin’s price drop. The news that the German government is selling Bitcoin was one of these things. Mt. Gox sending $2.7 billion worth of Bitcoin to a new address was another.
Crypto liquidations will probably slow down over the next few days because the market needs time to build up cash before moving in to take it out.All of this had an effect on the memecoin market as well. This stock was one of the best ones to buy in late May, but it has been going down lately.
Bitcoin Spurs Memecoin Changes
Coinglass data shows that between July 4th and 5th, long positions worth a total of $750.55 million and short positions worth $198.66 million were closed. In this case, “liquidation” means that a trader’s Futures position is stopped forcibly when their account margin is not enough to keep their open positions open.
When they are closed, they bring in market orders that go against the open account before it was liquidated. As a result, a sudden wave of long liquidations caused by sharp drops in prices causes a chain of liquidations.
This kind of large crypto liquidations can be good for the market. It can get rid of traders who have too much debt, which can lead to a spot-driven price move and lessen the impact of gambling. It’s possible that the current wave of selling will be good for Pepe (PEPE), which is the third-largest memecoin by market capitalization.
Reporters looked at PEPE’s liquidation heatmap and saw that a lot of the liquidation values between $0.000077 and $0.0000095 had been erased. Since the middle of May, this has been getting worse.
To the north, the $0.000014 area could be the next price trend line for the currency. Analysts looked at Dogecoin (DOGE) and Shiba Inu (SHIB) and found that both have a group of liquidation levels farther south.
Because of this, DOGE or SHIB may need more time and a greater correction to get better. Shiba Inu showed a bullish flag on longer timeframes, but PEPE might be the one to return from its recent losses the fastest.
Bulls in PEPE need to protect the area between $0.00000796 and $0.0000089 to keep their hopes for the longer term uptrend alive. The recent sales of crypto have caused fear in the market, but there is some hope that prices will start to rise again in July.
