After the crash, large amounts of liquidation took place on the cryptocurrency market. After the weekend’s crash, bitcoin fell below $30,000 for only the second time in the year. This had led to short liquidations of hundreds of millions. The market is still in turmoil and liquidations are now at $1 billion.
The Rekt of Crypto-Traders
The market crashed on the weekend and crypto traders took a heavy blow. This is a typical pattern, however, where one group takes the brunt. Long traders took the biggest hit, with 77.5% representing the bulk of Monday’s $421 million liquidation.
Bitcoin Price Hits Three-Month Low, What’s Driving This?| Bitcoin Price Hits Three-Month Low, What’s Driving This?
Trader in this market face new challenges as Tuesday is fast approaching. Although most people thought bitcoin would never fall to $30,000 it actually did so briefly and then recovered to recover to its previous level of $29,000. It would still be a disaster as many traders would lose their position in the marketplace.
In the last 24 hours, this number has risen to $1 billion with Bitcoin and Ethereum traders taking the majority of the liquidation. Long positions still dominate liquidations, as bitcoin struggles for its footing. Long traders are doing slightly better, with their numbers falling from 77.5% Monday to 71.8% Tuesday.
Coinglass: $1B in Crypto Liquidations| Source: Coinglass
As of the writing of this report, there are $1.10 billion in liquidations. The total liquidations amount to $789.27 millions for longs and $310.04million for shorts. Bitcoin and Ethereum remain at the forefront of cryptocurrency trading with liquidations totalling $354.77 millions and $326.51 Million, respectively.
Market sentiment dives to hell
The market sentiment has fallen along with the cryptocurrency market crash. It is not surprising that sentiment has moved in the opposite direction for several weeks. The market crash however has intensified this trend.
The Crypto Fear & Greed Index now has a reading of 10. The index’s reading is now at 10. This puts the market into extreme fear with the low number. Investors are more wary than ever about investing money in the market. Many investors opt to liquidate existing holdings to prevent further losses.
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It is important to remember that low sentiment could also signal a rally. This index dropped to its lowest level in July 2021. It was followed by a rebound that ultimately served to lift bitcoin above its current high of $69,000. If the past repeats itself, this could well prove to be another beginning for a huge bull rally. This is only if we have reached the bottom of this current crash.
Over $1 Trillion in losses for the crypto market | Source: Crypto Total Market Cap on TradingView.com
Featured image taken from ITPro Today. Chart from TradingView.com