Bitcoin fell to $59K as the US Dollar Index hit a 13-month high, while significant liquidations occurred in the crypto market.
Bitcoin's price dipped to $59,060 on June 24, coinciding with the US Dollar Index (DXY) reaching its peak in 13 months. At this moment, the cryptocurrency has seen some recovery, climbing back to approximately $61,700.
Other major cryptocurrencies also mirrored Bitcoin's decline. Ethereum is trading around $1,650, BNB at $570, and SOL priced at $70.
A significant market shift was observed, with a total liquidation in the crypto sector hitting $1 billion within a 24-hour span, primarily driven by long position liquidations, which accounted for $780 million, as reported by CoinGlass.
The Crypto Fear and Greed Index has notably decreased to a score of 12, indicating heightened fear among investors.
Market Insights
Technical analyst Joao Wedson suggests that while Bitcoin is striving to move past its capitulation phase, the market is yet to experience an "extreme scenario" seen in prior cycles, where miners incurred substantial losses and Bitcoin faced severe overbought conditions. He stated, "Bitcoin will eventually try to recover and move out of this capitulation phase. However, we still have not seen an extreme capitulation scenario like in previous cycles."
Additionally, CryptoQuant highlighted an unprecedented inflow of funds into Bitcoin accumulation addresses, suggesting that while retail investors are panic selling, large entities are taking advantage and absorbing the supply.
Despite these movements, analysts have pointed out persistent downward pressure in the futures markets, alongside a lack of positive developments. "Amid panic selling by retail investors, large players are accumulating Bitcoin at record rates," CryptoQuant noted.
Michaël van de Poppe, founder of MN Trading, emphasized that Bitcoin must close above the 200-week moving average, approximately $63,000, for a potential trend reversal. He advised against selling during this period, encouraging investors to hold their positions instead.
Lastly, it's important to note that US spot Bitcoin ETFs have recorded a negative performance over six consecutive weeks, with total outflows reaching $90.66 million as of June 18.
