The crypto market experienced a sharp sell-off on Monday, with $90 million worth of positions liquidated in an hour. While Bitcoin fell by over 1 percent, Ethereum fell by almost 2 percent as investors took profits. Leading altcoins such as Solana (SOL), BNB, XRP, and Cardano (ADA) fell by 2-3 percent after a major price rally in the last 24 hours. Meme coins Dogecoin (DOGE) and Shiba Inu (SHIB) lost 6 percent in an hour. Although the crypto market seems to be on a bullish trend following the news that Bitcoin-supporting Donald Trump won the US presidential election, some data are signaling a decline.
Will Bitcoin and altcoins fall?
According to Coinglass data, $90 million was liquidated in the crypto market in 4 hours and $650 million in the last 24 hours. In particular, $75 million worth of long positions and $15 million worth of short positions were liquidated in a few hours, triggering a sell-off in the market. More than 217,000 traders were liquidated, with the largest single liquidation order being placed on a BTC-USDT swap on the OKX crypto exchange for $15.56 million.
Bernstein analysts set a Bitcoin price target of $90,000 for the end of the year. The BTC price reached a new all-time high of $81,858 today, indicating a bullish trend in the largest cryptocurrency. However, data from the derivatives market is signaling concerns about a major sell-off that could trigger a potential market crash. Bitcoin implied volatility (IV) is falling sharply across all maturities, especially BTC ATM-7 IV. Bitcoin at-the-money (ATM) implied volatility is the market’s estimate of the likely movement in the BTC price. Therefore, options traders currently believe that the Bitcoin price will not rise any further. As a result, the price of major cryptos such as Ethereum, Solana, XRP, and Dogecoin have fallen, triggering a broader crypto market sell-off.
Mt. Gox move draws attention
Also, according to Arkham data, Mt. Gox transferred 30,371 BTC, about $2.44 billion, to two wallets on Monday. This has raised some concerns among investors, as it usually indicates that an exchange is planning to sell its tokens soon. China’s latest stimulus measures in the form of a 10 trillion yuan debt package have disappointed investors, leading to a shift in sentiment. Markets are bracing for the first volatility as the Donald Trump administration is expected to make major policy changes.
Upcoming US CPI and PPI inflation data, jobless claims, and Fed Chair Jerome Powell’s speech this week are all affecting the crypto market. Economists predict that inflation data will be high and could affect the market along with political changes in the US. However, popular analysts are optimistic about Bitcoin’s price in the long term. Veteran trader Peter Brandt predicted that a complex continuation of the inverse head-and-shoulders pattern would push the BTC price target to almost $125,000 by the end of the year and $300,000 in the long term. While there is skepticism about this pattern, notable analysts such as Richard W. Schabacker, Robert Edwards, and John Magee have accepted it.
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