TLDR:
- Bitcoin failed to hit $70,000, dropping below $67,000 with $123M in long positions liquidated
- ETF investments remain strong with over $2.2B in inflows last week
- Markets show correlation with traditional stocks, 40-day correlation above 80%
- Derivatives markets remain stable despite price decline
- Bitcoin futures premium stays above 9%, indicating bullish sentiment
Bitcoin’s price retreated from its approach toward $70,000 on Sunday, dropping below $67,000 in a move that triggered significant market liquidations. The leading cryptocurrency reached $69,428 before beginning its descent, resulting in approximately $200 million in total liquidations across the crypto market.
Data from CoinGlass shows that long positions bore the brunt of the correction, with $123 million in long positions liquidated across all cryptocurrencies over the past 24 hours. Bitcoin positions accounted for nearly $47 million of these liquidations. Ethereum slightly exceeded Bitcoin in total liquidations by less than $1 million.
Despite the price correction, institutional interest in Bitcoin remains robust. Exchange-traded funds (ETFs) recorded their strongest week since July, with inflows exceeding $2.2 billion, according to a Monday report from European asset manager CoinShares. This continued investment suggests sustained institutional confidence in the cryptocurrency market.
The price movement appears closely tied to traditional financial markets, with Bitcoin’s 40-day correlation with the S&P 500 remaining above 80%. This high correlation indicates that similar factors are currently driving both cryptocurrency and traditional stock markets.
Technical indicators show Bitcoin trading below the 100-hour Simple moving average, with key support levels established at $66,800 and $66,500. Resistance levels are currently positioned at $68,000 and $68,750.
The derivatives market has shown remarkable stability during the correction. The Bitcoin futures premium maintains levels above 9%, traditionally considered a bullish indicator. Options markets similarly display resilience, with the 25% delta skew suggesting neutral to bullish sentiment among traders.
Ethereum, the second-largest cryptocurrency, also experienced a decline, dropping about 1% to $2,670. However, CoinShares reports that Ethereum-focused investment products continue to attract capital, albeit at a more modest pace compared to Bitcoin ETFs.
The cryptocurrency market’s recent performance coincides with broader macroeconomic developments, including rising U.S. Treasury yields and ongoing discussions about government debt management. The U.S. debt interest costs have now exceeded $1 trillion annually, adding another factor to the market’s consideration.
Current trading data shows Bitcoin at $67,300, representing a nearly 2% decrease over the past 24 hours, while maintaining significant gains from its recent rally.
