As bitcoin experiences another retreat, analysts are closely examining technical indicators to gain insights into its next direction. One such indicator is the liquidity heatmap, which recently highlighted key first-test lines at approximately $56,800. According to CoinGlass, if BTC prices successfully bounce off this level, it may test higher ones. However, a weaker bounce could potentially lead to further downsides in the market.
The liquidation heatmap, which visually represents potential liquidation levels for leveraged positions in the Bitcoin market, is another crucial factor to consider. CoinGlass reported $156 million in liquidations over the past 24 hours, with the majority occurring in long BTC positions. Should BTC prices plummet to these critical levels, it could trigger a cascade of liquidation events, swiftly driving prices lower. This scenario mirrors the events of last Monday when BTC experienced a $12,000 drop in less than a day.
Several analysts have shared their predictions and observations regarding the current market situation. Analyst ‘CrypNuevo’ anticipates a potential decline in BTC prices to around $53,400, based on previous market movements. Meanwhile, MN Capital founder Michaël van de Poppe noted a substantial decrease in the altcoin market capitalization, contrasting with BTC’s dominance increase. Trader and analyst ‘Mags’ highlighted the altcoin market cap testing a critical support zone, suggesting a historical trend of significant bounces in altcoins following such tests.
Despite the overall market trends, many altcoins are currently facing a downturn. Coins like Solana (SOL), Toncoin (TON), and Dogecoin (DOGE) have experienced significant drops of over 7%. Additionally, most altcoins are currently in the red, mirroring the movements of bitcoin.
The analysis of technical indicators and expert predictions point to a potentially volatile period for bitcoin and altcoins. Traders and investors should closely monitor these indicators to navigate the market effectively and make informed decisions amidst the uncertainty.
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