The current price trends align with the asset’s movements since it reached a high of $81,255 on August 24. Initially, it managed to maintain support above $79,500, but that figure has since slipped to $79,000.
Market analysis indicates that the digital currency struggled to cross the key level after 5:00 a.m. EST, peaking at only $78,830. Each subsequent sell-off has resulted in progressively lower prices for Bitcoin, reinforcing the idea that the recent rally is losing momentum.
Bitcoin Liquidations Decline, Impacting Long Positions the Most
Bitcoin’s price movements in the past day have led to a noticeable decrease in liquidations, particularly affecting leveraged long positions. Data from Bitstamp shows that total liquidations for Bitcoin reached over $88 million, with long positions accounting for around $77 million of that total. This pattern is mirrored across the wider cryptocurrency market, with overall liquidations exceeding $302 million, divided into $247 million from leveraged longs and $55 million from shorts.
In the aftermath of the recent price surge, various analysts, including well-known figures like BitMEX founder Arthur Hayes, have linked Bitcoin’s performance to decisions made by the U.S. Treasury. However, opinions differ on the longevity of the upward trend ignited by bond buybacks. While Hayes interprets this as the onset of a bull market, others like Han Tan, chief market analyst at Bybit, are more cautious.
Bybit Analyst Highlights Potential Macro Challenges for Bitcoin’s Growth
Tan acknowledges that Bitcoin’s recent rise was largely fueled by renewed interest in debasement trading, further intensified by a short squeeze. However, he warns that significant macroeconomic challenges must be navigated before this uptick can become a sustainable bull market.
“From a technical standpoint, $BTC bulls are required to overcome the 50-week simple moving average, which presented formidable resistance today. A rebound to the $82.5k–$83k range would exceed the breakeven point for many ETF investors, potentially encouraging new investments from those sitting on the sidelines,” Tan stated in a discussion with Bitcoin.com News.
Nevertheless, the Bybit analyst cautioned about risks entailed in Bitcoin’s upward momentum, which is heavily influenced by macroeconomic indicators. He warned that $BTC might lose steam “if U.S. Treasury Secretary Scott Bessent provides more clarity on his ‘Treasury twist,’ easing concerns over the U.S. fiscal deficit.”
Moreover, a strongly hawkish message from Fed Chair Kevin Warsh during his upcoming speech at Jackson Hole this Friday could also lead Bitcoin and other cryptocurrencies to lose their recent gains, Tan argued. As of 4:30 p.m. EDT on Wednesday, $BTC was trading slightly above $78,250 per coin, reflecting a decline of about one percent during the day.