Bitcoin’s recent dip triggers widespread liquidations and market corrections. But growing interest in the crowd to buy discounted coins suggests potential recovery.
The altcoin market witnessed a massive correction as Bitcoin price BTC $120 272 24h volatility: 1.6% Market cap: $2.39 T Vol. 24h: $50.63 B momentarily dropped to $94,355. Over the past 24 hours, the top altcoins have witnessed a correction of 3%-12%, with XRP XRP $3.59 24h volatility: 17.9% Market cap: $212.65 B Vol. 24h: $19.17 B dropping 10.06% and Cardano falling 12.50%.
Amid the massive crash over the past 24 hours, the total crypto market cap, excluding BTC and ETH ETH $3 608 24h volatility: 7.6% Market cap: $435.44 B Vol. 24h: $59.70 B , plunged by 10.75%, wiping out $121.69 billion in valuations. This sharp decline has significantly affected altcoin holders, drastically reducing their portfolio values.
Crypto Market Loses $1.73B in Liquidations
According to Coinglass data, the crypto market has bled $1.73 billion over the past 24 hours. Due to the broader market correction, optimistic traders with leveraged long-size positions were hit significantly.
The data reveals $1.55 billion in long liquidations compared to just $184.87 million in short-sized liquidations. The largest single liquidation order happened on Binance in the Ethereum-USDT pair, accounting for $19.69 million.
Furthermore, 580,793 liquidators were liquidated over the past 24 hours. Amid the broader market pullback, the BTC registered a downfall of $185.03 million, with bulls losing $146.8 million.
Furthermore, Bitcoin’s open interest has dropped below the $60 billion mark and stands at $59.72 billion, with a 2.76% drop over the past 24 hours. Amid the broader market pullback, the open interest-weighted funding rate has declined to 0.0124% compared to the 0.0262% peak.
Furthermore, social sentiments reflect the market’s view of the correction as an optimistic entry opportunity.
Santiment Reveals Market Willing to Buy the Dip
In a recent tweet from Santiment, data reflects the surge in buying interest among crypto investors based on social media volumes. Over the past four correction tips, the social volume related to “buy” or “buying” or “bought” AND “crypto” or “cryptocurrencies” has witnessed a massive spike.
This reflects the broader market sentiment of buying additional crypto amid market pullbacks.
📊 The following illustrates the level of interest in buying crypto (in blue) vs. selling crypto (in red) across social media over the past month. With Bitcoin's retrace to about $94.7K earlier, watch to see if retail shows FOMO at these cheaper levels. 👇https://t.co/BwsGe1Hwq5 pic.twitter.com/eFksH8APUu
— Santiment (@santimentfeed) December 10, 2024
Over the past three dips, social media volumes related to purchasing more crypto have significantly increased. Amid the current pullback, this surge in interest in buying additional crypto marked a fresh high, surpassing the previous three occurrences.
Hence, the crowd’s interest in trying to bag more crypto for the fourth consecutive time reflects the surge in underlying confidence. Furthermore, in resonance with the social volume surge, the BTC price surged on similar days.
Source: Tradingview
The first occurrence, documented on November 27, saw the BTC price surge 4.41%. This was repeated on December 4, marking a 2.97% jump, followed by December 6, which saw a 2.93% rise. Hence, the BTC price will likely witness a recovery with the fourth occurrence.
Bitcoin to Lead the Way
Amid the ongoing correction, the BTC price has broken under the 50-EMA line of the 4-hour chart. Currently, Bitcoin is testing two crucial support confluences: the 100-EMA line of the 4-hour chart and a long-coming support trend line. With multiple low-priced candles, the BTC price is struggling to sustain its value above the $97,000 level. This also marks a crucial test of the previous bullish reversal point.
Source: Tradingview
This increases the chances of a double-bottom reversal for Bitcoin. However, the lack of bullish divergence and the declining trend in the MACD and signal lines also warn of a consolidation prior to any bullish recovery. Based on the BTC price action, the crucial resistance level is the previous peak at $101,171. For a bullish recovery, BTC price must surpass the 50-EMA line and find a closing above this level to prolong the recovery run. Hence, price action traders must pay attention to these crucial supply zones.
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