Bitcoin [BTC] price gets rejected above $10,000 for the third time this year as price fails to make a higher high above $10,500. The drop in price was far to instantaneous for any trader to jump into it.
The price of Bitcoin [BTC] at 16: 00 hours UTC on 2nd June 2020 is $9450.
Difference on BitMEX
The low recorded at Bitstamp was around $9135, whereas, the low at BitMEX was $8600 (primarily caused due to a series of a long squeeze). The swift price action imprinted the Bart and Simpsons pattern on the hourly chart.
The lows recorded elsewhere were in the range of $9350 – $9100, but the difference on BitMEX could have been due to slippage and cascading liquidations. Nevertheless, since the open order on Okex was comparable to BitMEX around $800 million it raises doubts on the design of their trading engine.
The high funding rate and basis before the crash above $10,000 provided ample liquidity for short whale orders to drive down the price. The crash of over 15% in less than two minutes caused close to $100 million long liquidations on BitMEX. Danny Masters, the chairman at CoinShares drew an apt analogy describing the drop,
#bitcoin finds the over-leveraged like water finds a crack in the ceiling
The markets had primarily taken a bullish outlook prior to the crash. Although the crash was caused due to the extreme liquidity of long orders, the sentiments have now gone haywire. Traders will look form certain outlooks before dipping their toes in high leveraged orders again.
Do you think it is a good time to buy the dip? Please share your views with us.