Bitcoin Price Outlook: Almost $521 million in total liquidations as BTC hits new ATH

Bitcoin price recorded a peak of $69,324 on Tuesday only for a short while before a retraction.
It is unlikely that BTC will peak at $69K twice, with $70,000 likely to come soon.
Almost $200 million shorts have been liquidated against $324 million in long positions.

Bitcoin (BTC) price nuked on Tuesday to an all-time high of $69,324, blowing millions in short and long positions out of the water.

Also Read: Bitcoin peaks at $69,324 with BTC fourth halving around the corner

Open Interest, funding rate FAQs

How does Open Interest affect cryptocurrency prices?

Higher Open Interest is associated with higher liquidity and new capital inflow to the market. This is considered the equivalent of increase in efficiency and the ongoing trend continues. When Open Interest decreases, it is considered a sign of liquidation in the market, investors are leaving and the overall demand for an asset is on a decline, fueling a bearish sentiment among investors.

How does Funding rate affect cryptocurrency prices?

Funding fees bridge the difference between spot prices and prices of futures contracts of an asset by increasing liquidation risks faced by traders. A consistently high and positive funding rate implies there is a bullish sentiment among market participants and there is an expectation of a price hike. A consistently negative funding rate for an asset implies a bearish sentiment, indicating that traders expect the cryptocurrency’s price to fall and a bearish trend reversal is likely to occur.

Over half a billion in total liquidations as Bitcoin nukes to a new all-time high

Bitcoin (BTC) price shattered the previous peak of $68,999.99 recorded in 2021 to set a new all-time high (ATH) of $69,324 on Tuesday. Data from Coinglass shows that over the last 24 hours, cryptocurrency markets have witnessed over $521 million in total liquidations, comprising $196.6870 million in short positions against $324.287 million in long positions.

BTC liquidations

The surge in Bitcoin price was remarkable and will be remembered as the first time the pioneer cryptocurrency set a new peak price way ahead of a halving event. Data from CoinGecko shows the halving is approximately 46 days out, with the event expected to see miner rewards slashed by 50% from 6.25 to 3.125 BTC.

Meanwhile, with Bitcoin price making headlines for the new milestone, Eric Balchunas, Bloomberg Intelligence’s exchange-traded funds (ETF) specialist, revealed that spot Bitcoin ETFs blew past the $50 billion mark in assets under management (AUM).

Specifically, the ten spot Bitcoin ETFs now hold more than $50 billion in assets barely eight weeks after they started trading with just under $30 billion in assets.

The ten spot bitcoin ETFs have blown through $50b in assets.. began life 7 weeks ago under $30b. About $8b of it is from flows, the rest from bitcoin value going up. pic.twitter.com/CZCl4mdd7Y
— Eric Balchunas (@EricBalchunas) March 5, 2024

Balchunas ascribes approximately $8 billion to flows while acknowledging that the rest was inspired by the surge in Bitcoin price. According to the ETF specialist, if this pace is sustained with $10 billion in assets added every month, spot BTC ETFs could easily beat gold ETFs by the summer of 2024. Cognizant that this is a long shot, Balchunas observes that it is possible if Bitcoin price continues to show strength.

Bitcoin price outlook after BTC records new ATH

After nicking the $69,000 psychological level, Bitcoin price has dropped almost 2% amid ongoing profit-taking. Momentum is falling as seen with the southbound Relative Strength Index (RSI). The RSI has crossed below the yellow band of its signal line, which is a sell signal, and could soon confirm that BTC is ripe for selling once it crosses below 70.

While the market still leans in favor of the upside, an extended fall could see Bitcoin price slip below the $60,784 support and ultimately retest the $60,000 psychological level. While a break and close below this level would threaten the short-term viability of the bullish outlook, it would likely provide an ideal opportunity to buy the dip before a possible move north.

Meanwhile, the bullish presence in the market remains strong. This can be seen in the green histogram bars of the Awesome Oscillator (AO) and the Moving Average Convergence Divergence (MACD). The MACD line is also well above its signal line, further strengthening the bullish thesis.

BTC/USDT 1-day chart

Nevertheless, if Bitcoin price retests the $60,000 threshold and fails to recover, it would produce a lower low, marking a possible entry for the bears.

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