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Breaking News: Coinbase Confirms DOJ Investigation Following Major Security Incident

Bitcoin Soars to $21,500 On “Hated Rally,” Is There Fuel To Keep Rising?

Reynaldo Marquez
Reynaldo Marquez
2 years ago
2 mins read
Bitcoin

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The Bitcoin rally continues as the cryptocurrency smashes all resistance levels and seems ready to reclaim more ground. The number one crypto by market capitalization has seen a double-digit gain over the previous week leading the top performers in the sector.

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As of this writing, Bitcoin traded at $21,400 with sideways movement in the last 24 hours. The BTC price records a 23% rally in the previous seven days. Other cryptocurrencies in the top 10 record similar price action with Ethereum (19%) and Polygon (18%).

The crypto has seen some losses but could recover during today’s trading session.

Bitcoin BTC BTCUSDT
BTC’s price trends to the upside on the daily chart. Source: BTCUSDT Tradingview

Bitcoin Shorts Are Wipeout, Bear Market Over?

Any “good” price rally must be a “hated” rally; Bitcoin follows this rule. As the cryptocurrency trended to the upside from its yearly lows, crypto traders began shorting it with overleverage positions.

When Bitcoin was about to breach $17,500, the price action went sideways, allowing overleverage shorts to take positions; these traders were expecting BTC to fail the re-test of this resistance level. Their positions provided liquidity to the upside and the fuel to send Bitcoin to its current levels.

According to a report from Bitfinex, $450 million were recorded in short liquidations as BTC began its ascend. This data represents the most significant short squeeze since July 2021 across the crypto market, as seen in the chart below.

Bitcoin BTC BTCUSDT Chart 2
Source: Bitfinex

The BTC price action is displaying a similar behavior; it’s moving sideways as shorts pile in, expecting to profit from another crash. Their positions could still provide fuel for this rally, but the report warns about long traders going greedy, expecting further appreciation:

It is typical for bear markets to have a complete wipeout of shorts (…). even with the leg up, the market remains highly illiquid, and with the sharp fall in Open Interest over the weekend, a pullback might be expected with a cautious approach from bulls.

Some Room To Run

Additional data from a pseudonym analyst indicates that Open Interest, the number of total positions for the derivatives sector, is still skewed to the short side. Thus, traders could see more short-term appreciation before Bitcoin and Ethereum record a pullback.

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In this scenario, the $19,600 and $19,700 areas have confluence with the 200-day simple moving average and the liquidity of long positions using 50x leverage or more. In other words, these levels should operate as critical support if BTC begins retracing its gains.

Bitcoin BTC BTCUSDT Chart 3
BTC liquidation levels. Source: Loner via Twitter

As seen in the chart above, $19,600 is crucial if Bitcoin continues to crash.

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Reynaldo Marquez
Reynaldo Marquez

Reynaldo Marquez

A literature major, Reynaldo Márquez has been deeply immersed in the crypto industry since 2017. His journey began with translating articles for various crypto news outlets, a role he took on with zeal. In 2018, amidst a challenging market, he embraced his first writing assignment, demonstrating his unwavering commitment to the nascent industry and the promise of change it bears for many people worldwide.
In March 2021, he joined the prestigious crypto news outlet NewsBTC and Bitcoinist, where he not only reported on the latest crypto news but also had the privilege of interviewing some of the industry's most influential figures. A year later, his dedication and hard work were recognized, and he was promoted to Managing Editor, a position he currently holds with pride.
He believes in honesty, good communication, hard work, and the power of cryptocurrency and its potential to transform people's lives, especially those alienated by the legacy financial system. Born in 1992 in Venezuela, Reynaldo is familiar with how governments and central banks can negatively affect people, their everyday lives, and their futures by creating inflation and erasing their hopes for a better future. Thus, like many Venezuelans, he embraced this new technology to help him and his family navigate difficult times.
In another life, Reynaldo would have pursued a career as an investigator, most likely tracking down the origins of the Cyberpunk movement with the publication of William Gibson’s ‘Neuromancer.’ The intersection between fiction and reality, with the materialization of Bitcoin in 2009, would have allowed him to dive deep into the crypto sphere as something more than a financial phenomenon but also a cultural shift in society that was brewing since the XX century, and maybe even sooner, in the XIX century with the publication of Henry David Thoreau’s ‘Civil Disobedience.’
But that’s for another life. In this one, Reynaldo has been trading to improve his trading skills. Since 2023, he has been trying to learn Python to create successful strategies and find ways to execute them. It is a difficult task, which continues to keep him busy today and will most likely continue to keep him busy in the near and long term.
In his free time, he enjoys lifting heavy objects, reading, watching movies, and listening to his favorite music. Some of his favorite authors are Walt Whitman, William Faulkner, Allen Ginsberg, James Baldwin, Raymond Carver, Ray Bradbury, George Orwell, Mario Vargas Llosa, Reinaldo Arenas, Rafael Cadenas, and many others. Lately, he has been primarily interested in reading about dystopic societies, a topic that deeply resonates with the crypto industry.
Since 2023, he has lived in Spain with his wife. He loves the weather, the food, and the people and their culture. They both expect to travel much more within the country they now call home and beyond its border. He hopes to retire with his wife, maybe in a quiet place near a beach, but most likely in a city close to a library and a university with his kids and, hopefully, grandkids.

Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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Reason to trust

Strict editorial policy that focuses on accuracy, relevance, and impartiality
Created by industry experts and meticulously reviewed
The highest standards in reporting and publishing
How Our News is Made

Strict editorial policy that focuses on accuracy, relevance, and impartiality

Ad discliamer

Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio.

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NewsBTC is a cryptocurrency news service that covers bitcoin news today, technical analysis & forecasts for bitcoin price and other altcoins. Here at NewsBTC, we are dedicated to enlightening everyone about bitcoin and other cryptocurrencies.

We cover BTC news related to bitcoin exchanges, bitcoin mining and price forecasts for various cryptocurrencies.

Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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