#whatwilldrivecryptoandstocks’nextrebound?
A WAVE OF LIQUIDATIONS ISN’T A REBOUND. WHAT WILL BRING BUYERS BACK?
BTC fell below $70,000, to around $68,900, its lowest level since August, and is down about 17% this quarter.
More than $1.3 billion in futures contracts were liquidated in 24 hours, including about $677 million in Bitcoin. Around $500 million was liquidated when the price fell below $70,000.
Here’s the chain of events as I see it:
High inflation in October (0.4% vs. 0.3%) → likelihood of a Fed rate hike on December 9 (around 85% for 25 basis points, with some calling for 50) → the dollar index above 103, its highest level in 19 months → sell-offs in crypto and tech stocks → liquidation of leveraged long positions.
My view: a wave of liquidations clears out leverage, but it doesn’t bring buyers back. And buyers are needed for a rebound to happen.
Here’s what I’d like to see before calling it a rebound:
ETF flows turn positive. Spot Bitcoin ETFs have recorded about five consecutive days of outflows, totaling around $1.4 billion, according to one tally. Stablecoin supply stops contracting. It has fallen by about $14 billion in 30 days. The dollar stops rising, and the next core CPI reading comes in below 0.3%. Bitcoin moves back above $70,000, then around $73,000, and holds there. Below that, traders are watching $68,000, then the $65,000 to $66,660 range.
What’s your strategy? Share in the comments 👇
$BTC
$AKE
$BARD
A WAVE OF LIQUIDATIONS ISN’T A REBOUND. WHAT WILL BRING BUYERS BACK?
BTC fell below $70,000, to around $68,900, its lowest level since August, and is down about 17% this quarter.
More than $1.3 billion in futures contracts were liquidated in 24 hours, including about $677 million in Bitcoin. Around $500 million was liquidated when the price fell below $70,000.
Here’s the chain of events as I see it:
High inflation in October (0.4% vs. 0.3%) → likelihood of a Fed rate hike on December 9 (around 85% for 25 basis points, with some calling for 50) → the dollar index above 103, its highest level in 19 months → sell-offs in crypto and tech stocks → liquidation of leveraged long positions.
My view: a wave of liquidations clears out leverage, but it doesn’t bring buyers back. And buyers are needed for a rebound to happen.
Here’s what I’d like to see before calling it a rebound:
ETF flows turn positive. Spot Bitcoin ETFs have recorded about five consecutive days of outflows, totaling around $1.4 billion, according to one tally. Stablecoin supply stops contracting. It has fallen by about $14 billion in 30 days. The dollar stops rising, and the next core CPI reading comes in below 0.3%. Bitcoin moves back above $70,000, then around $73,000, and holds there. Below that, traders are watching $68,000, then the $65,000 to $66,660 range.
What’s your strategy? Share in the comments 👇
$BTC
$AKE
$BARD
