The recent Bitcoin liquidation heatmap on a 3-day chart indicates potential for high liquidation levels within the $42,000 and $46,000 price ranges. Liquidations occur when leveraged positions are forced to close due to an adverse movement in the price of BTC.
On January 12th, the BTC market experienced a significant long liquidation of $112 million, marking the second-highest long liquidation volume since the beginning of the year, as reported by Coinglass. This coincided with a 7% price decline, according to CoinMarketCap data.
As of the time of writing, BTC was trading at $42,658. Despite expectations for a surge above $50,000 post-ETF approval, the price has fallen by almost 10% since then. Daily demand for BTC peaked on January 12th and has subsequently decreased. Glassnode data shows a 28% decline in the daily count of unique addresses involved in BTC transactions since the peak. Only 710,706 unique addresses were active on the BTC network as of January 14th.
A bearish crossover of BTC’s MACD line with its trend line on the daily chart indicates a re-entry of bearish sentiment into the market. Additionally, the Relative Strength Index (RSI) is below the center line, signaling selling pressure exceeding accumulation of the coin.
Since January 12th, market volatility has increased, with the gap between the upper and lower bands of BTC’s Bollinger Bands (BB) indicator widening progressively. This suggests that the price of BTC is susceptible to significant fluctuations.
It is important to note that the information provided in this article is for informational and educational purposes only and should not be considered financial advice. Readers are urged to use caution and seek professional guidance before making any investment decisions.
