Bitcoin began a correction, falling below $ 55,000 on Monday. The decline of the first cryptocurrency from record highs reached $ 7,000 at the moment (more than 12%).
“The move to new all-time highs over the weekend is likely speculative on the part of retail investors,” said the FxPro analyst team.
The fall resulted in the liquidation of more than $ 2.2 billion in margin positions in Bitcoin futures over the past 24 hours. A similar situation was observed at the end of February. Then, bitcoin experienced the largest one-day liquidation of futures in its history, writes ttrcoin.
The decline is associated with the confirmation of India’s plans to ban the ownership of bitcoin and other cryptocurrencies. If that happens, India will become the first major economy to make crypto ownership illegal. Even China is not fined for possession, Reuters notes.
According to the observations of analysts at Glassnode, the inactive supply of bitcoin over the past 3-6 months has reached a five-month high. This may indicate a revival among investors wishing to lock in unrealized profits from investments in the first cryptocurrency.
Experts view the current pullback as healthy, noting that the $ 60,000 breakout was driven primarily by margin traders. Bitcoin may experience a deeper decline if the yield on US government bonds continues to rise.
At the same time, Richard Byworth, CEO of Nasdaq-listed Diginex exchange, said he expects bitcoin to rise to $ 175,000 by the end of the year. He admits that BTC may still have significant upside potential, and the Fed’s money printing and dollar depreciation will push it higher.
Four companies – MicroStrategy, Tesla, Square and more recently Meitu – have captured 40% of the annual supply of bitcoin in just a few months, he noted.
“How long will buyers stay on the market? The support program means that Americans will again receive money from the state to their accounts. Thus, it can be assumed that the rally is not only not close to completion, but will also show a number of historical highs, and the next important point of resistance could be $ 70K, ”the FxPro team of analysts notes.
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