Altcoins Crash Lead to $1.76 Billion in Crypto Liquidations, What’s Next?
Summary
- Analysts describe the altcoin crash as a healthy pullback to the super trend support levels.
- Buy-the-dip opportunities arise at the super trend support levels for various altcoins.
- Bitcoin dominance increases but remains below crucial resistance, indicating that altseason is still intact.
Bitcoin’s price drop has been accompanied by a significant correction across the broader altcoin market. Leading cryptocurrencies like Ethereum (ETH), Solana (SOL), XRP, and Dogecoin (DOGE) have all experienced declines ranging from 6% to 12%. These losses have sparked heavy liquidations, with over $1.76 billion worth of positions being wiped out. The widespread downturn has left many investors questioning the stability of the crypto market.
The recent price actions come after Bitcoin faced multiple rejections at the $100K level, further amplifying market concerns. Despite the cryptocurrency reaching significant milestones earlier this year, it has struggled to maintain upward momentum. These repeated rejections have contributed to growing uncertainty about Bitcoin’s ability to push past key resistance points.
As the market continues to experience these corrections, investors are left pondering whether the altcoin rally is nearing its end. The recent downturn has raised doubts about the future performance of altcoins, with some fearing that the bullish trends that characterized the market in recent months might be coming to a halt. This shift in sentiment has caused increased caution among crypto traders.
Altcoins Experience Significant Losses Amid Broader Market Sell-off
Since September, traders have quickly re-aligned their positions in altcoins, seeking buy-the-dip opportunities. Today’s Bitcoin price drop below $95,000 has triggered even greater liquidations across the crypto market.
Blockchain analytics platform Santiment noted that cryptocurrencies, which saw significant gains during the last two months’ bull run, have faced sharp declines in the past 24 hours.
However, it warned that if retail traders give in to fear and start offloading their holdings, the market could see a quick rebound as buying opportunities arise. On the other hand, crypto analyst IncomeSharks pointed out that the altcoin sector has maintained its super trend, with professional traders actively buying the dips.
IncomeSharks remains optimistic about the recent downturn in altcoin prices, viewing it as a potentially bullish development for the market. “This is the most bullish thing to happen to altcoins,” the analyst stated. The downturn has also triggered significant crypto liquidations, which are now approaching $2 billion.
The analyst highlighted that the correction has helped flush out new buyers while keeping Supertrend support levels intact, which is a positive sign for the market.
According to another crypto analyst, Rekt Capital, the altcoin market has encountered rejection at a historically significant resistance level. However, the analyst suggested that this pullback might be less severe than previous ones, signaling a weakening of the $425 billion resistance level. This trend could indicate growing momentum for a potential breakout in the near future.
Crypto Liquidations Surge to $1.76 Billion
According to Coinglass data, crypto liquidations have surged to $1.76 billion in the last 24 hours, with $1.58 billion in long liquidations and $185 million in short liquidations.
The cryptocurrency market experienced significant turbulence over the past 24 hours, with 583,647 traders liquidated across exchanges. The largest single liquidation order occurred on Binance in the ETH/USDT pair, totaling $19.69 million. Popular crypto analyst Michael van de Poppe commented on the situation, stating, “That’s the flash crash drop on altcoins. Some have dropped by 30% on the day. Don’t worry, this will reverse back fast, you’d want to see such a massive collapse and liquidity wipe. Onwards we go.”
Following today’s crash, Bitcoin’s dominance has risen slightly. Crypto analyst Benjamin Cowen pointed out a key milestone in Bitcoin dominance, noting that it recently touched the previous wedge level when excluding stablecoins. Cowen added that as long as Bitcoin dominance remains below this level, altcoin-to-Bitcoin (ALT/BTC) trading pairs will remain structurally stable.
At the time of writing, Bitcoin is trading 2.6% lower at $96,905, with a market cap of $1.917 trillion. The 24-hour Bitcoin liquidations have risen to $189 million, with $149 million in long liquidations.
Meanwhile, Ethereum has dropped 6.62%, reaching $3,684 according to the technical charts. Crypto market analysts suggest that these dips present buying opportunities, as they believe Ethereum could reverse its current trend.
