It is stated that the liquidation of long positions in the Bitcoin futures market may have contributed to the formation of a local bottom.
According to a report published by crypto analytics platform CryptoQuant, although price indicators are still in a bearish trend and technical indicators point to the possibility of additional declines, liquidations in long positions indicate that selling pressure is decreasing.
When there are significant price declines in the markets, the number of contracts opened for long positions decreases rapidly due to liquidation. This reduces the overall selling pressure in the market. This development, especially at the beginning of October, has played a decisive role in the short-term price movements of Bitcoin.
Could Support Bitcoin Price$BTC
On October 1, more than 4,000 BTC long positions were liquidated, marking the second-largest liquidation event of 2024, according to CryptoQuant data. Experts note that such moments of high losses and liquidations often lead to the formation of local lows, which could allow the market to recover in the short term and prices to rise again.
Buying Pressure Required
The report emphasizes that the current price is likely to maintain the current range in the short term. However, it is stated that in order for this recovery to be permanent and to compensate for the declines, purchasing power should be monitored carefully. If buyers can show sufficient strength, a recovery in prices may become possible.