Bitcoin Late Longs Were Liquidated As BTC Price Dropped To $65K

Over the past week, Bitcoin leveraged positions have surged, but a significant portion of these 'late longs' have been liquidated as the BTC price fell to around $65,000.

Source: www.ekonomim.com

This decline follows multiple unsuccessful attempts to breach the $70,000 mark, highlighting this resistance level's importance to bearish traders. After the July 30 Wall Street open, Bitcoin bears intensified their sell side activity, pushing the price below $66,000 and resulting in a notable reduction in leveraged longs. Currently, Bitcoin is trading at $65,798 which reflects a 2.3% drop in the past 24 hours.

According to popular trader Skew, approximately $800 million in Bitcoin futures open interest (OI) has been wiped out following this recent drop from $70,000. Open interest represents the total number of outstanding Bitcoin derivative contracts across all exchanges. Skew attributes the sell off to spot selling and suggests that an increase in leveraged long positions and spot buying volume is necessary to reclaim the weekly open at $67,500.

Traders observed that long BTC liquidations are concentrated at $69,000, leading to a significant reduction in open interest. He echoed Skew's sentiment that spot activity will be crucial in determining market direction. Daan Crypto Trades also noted the presence of large orders above the current spot price, which seem to be aimed at maintaining the price at its current level. Futures open interest has been rising sharply, reaching a record $39.46 billion across all exchanges as of July 29, according to Coinglass data. Daan Crypto Trades believes this rapid increase in OI indicates potential for increased volatility.

Market participants are now focusing on long traders and spot buying activity. If the price drops to $65,500, long BTC liquidations are likely to begin, marking a potential decrease of about 0.25% from current levels. Additionally, short liquidations are accumulating between $70,000 and $72,000, with some longs using 10x leverage possibly facing liquidation if the price falls to between $60,372 and $58,400, suggesting a potential drop to these levels.

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