9h00 ▪
4
min reading ▪ by
Luc Jose A.
A wind of panic is blowing through the crypto market. While bitcoin reached peaks close to $100,000, it fell below $96,000 this Sunday, November 24, 2024, then rebounded. This event, accompanied by massive liquidations of more than $500 million, shakes investor confidence and questions the underlying dynamics of the market.
Massive Liquidations and Downward Pressure
After several days of climbing to all-time highs, bitcoin faced a sharp reversal below $96,000 to $95,996, but thanks to a rapid rebound, it currently reached $97,917 at the start of week. This decline was accompanied by massive liquidations which affected nearly 200,000 positions. Among these losses, “long” traders were the most affected, representing $383 million out of the $500 million liquidated in total.
Observers also point to technical signals which had hinted at an imminent correction. Thus, the TD Sequential indicator, used to detect trend reversals, issued a sell signal on the 12-hour chart of bitcoin. “If this correction is confirmed, bitcoin could slide towards critical thresholds, to $91,583 or even $85,610,” said Ali Martinez, global head of information at BeInCrypto. Such movements illustrate the extent to which volatility remains inherent in this market, even during periods of general increase.
Geopolitics and macroeconomics: essential influences
This decline is not just a matter of charts. Geopolitical tensions play a significant role in this dynamic. In addition, the recent escalation of hostilities in the Middle East, marked by Iran's declarations regarding Israel, has increased market nervousness. In times of crisis, investors tend to favor traditional safe haven assets such as gold, and abandon riskier assets such as Bitcoin.
Macroeconomic events in the United States add another layer of complexity. Indeed, the lasting strength of the job market and speculation around further interest rate cuts by the Federal Reserve continue to shape investor expectations. Historically, accommodative monetary policy has supported Bitcoin, but current uncertainties are dampening this momentum. These factors combined amplify volatility, and make short-term forecasts more risky than ever.
Despite this decline, the fundamentals of Bitcoin remain robust. History highlights that corrections, although feared, have often paved the way to new highs. However, observers are showing signs of confidence on the medium-term outlook, particularly as we approach 2025, where a combination of factors, including institutional adoption and seasonality, could reignite interest in the asset. However, for investors, caution is required in an environment where risks, whether economic or geopolitical, are omnipresent. Bitcoin continues to captivate, but its abrupt movements remind everyone that its very nature remains unpredictable.
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Luc Jose A.
A graduate of Sciences Po Toulouse and holder of a blockchain consultant certification issued by Alyra, I joined the Cointribune adventure in 2019. Convinced of the potential of blockchain to transform many sectors of the economy, I took the commitment to raise awareness and inform the general public about this constantly evolving ecosystem. My goal is to enable everyone to better understand blockchain and seize the opportunities it offers. I strive every day to provide an objective analysis of current events, to decipher market trends, to relay the latest technological innovations and to put into perspective the economic and societal issues of this ongoing revolution.
