Bitcoin Liquidations Surge With S&P 500 Fall, 75% Crash Likely?
Highlights
- S&P 500 dropping by 2% on Tuesday leads to major liquidation across the entire crypto market.
- The Stochastic RSI on Bitcoin's 2-month chart turns bearish hinting at a major crash ahead.
- Bitcoin and altcoins face significant drops, along with a spike in Bitcoin ETF outflows.
It has been a bloodbath on Wall Street on Tuesday, with top US indices like the S&P 500 correcting more than 2%. The Bitcoin price is also facing strong correction dropping another 4.5% and moving to $56,500 levels leading to a surge in the BTC long liquidations.
Bitcoin Liquidations Surge With Chances of 75% Crash
In correlation with the S&P 500, the BTC price has been facing strong selling pressure with Bitcoin long liquidations on the rise in the last 24 hours. Citing the Coinglass data, popular crypto analyst Ali Martinez noted that $246.64 million in liquidation leverage is likely to get wiped out if the BTC price drops under $56,840 levels. As of press time, BTC is already trading under those levels.
$246.64 million will be liquidated if #Bitcoin drops to $56,840! pic.twitter.com/Z0tRcZEDAU
— Ali (@ali_charts) September 3, 2024
Additionally, Ali Martinez has also issued a cautionary observation on the current BTC price trajectory. The analyst pointed out the Stochastic RSI on Bitcoin’s 2-month chart that signals a major shift from the bullish to the bearish trend.
He also stated that over the past decade, similar signals have preceded major corrections with BTC seeing declines of approximately 75.50%. Thus, if the historical patterns repeat, Bitcoin investors should prepare for significant downturns going ahead.
Popular trader Peter Brandt turned bearish on Bitcoin citing the lack of momentum while pointing out a series of lower highs and lower lows for the BTC price. He shows that this market structure shows a lack of major buying interest that could drag the BTC price even lower.
On the other hand, the spot Bitcoin ETF outflows have skyrocketed to more than $287 million on Tuesday, as institutional players seek to move from risk-ON assets.
Key Developments Dragging S&P 500 Down
On Tuesday, the US DOJ issued a subpoena to chipmaker Nvidia sending shockwaves across Wall Street with the S&P 500 slipping by 2.12%. The Nvidia stock price crashed 10% leading to a major fall for other big tech companies as well.
This led to a strong crypto market crash on late Tuesday with BTC and altcoins crashing anywhere between 4-10%. All eyes will be on the US Federal Reserve expected to cut interest rates by 50 bps later on September 18.
It will be interesting to see whether the BTC price rebounds from here or whether the bears strengthen their grip moving ahead.
- Trump Tariffs: China Ready To Work With U.S. as Trade Tensions Spark Crypto Market Crash
- Breaking: Ripple Acquires GTreasury for $1 Billion, Expanding Into Treasury Markets
- Examining AYNI, a Capacity-Linked Crypto Framed as a Real-World Asset Through Gold Mining Throughput
- 25 or 50 bps? Waller, Miran Split on Fed Rate Cut Size Ahead of FOMC
- GENIUS Act Lacks ‘Robust Guardrails’ for Stablecoin Users, Fed’s Barr Warns
- Analyst Predicts XRP Price Crash to $2 as Open Interest Falls, Death Cross Nears
- Dogecoin Price Eyes $0.40 Rally as Thumzup Integration Boosts Utility
- Pi Coin Price Gears for Recovery as DEX and AMM Launch Revives Utility Hopes
- Cardano Price Teeters as Whales Exit and Bearish Signal Emerges
- Sui Price Targets $9.5 as Figure Brings SEC-Approved Yield Token YLDS to Sui
- Chainlink Price Eyes $100 as S&P Global Partnership Expands Institutional Adoption
Why Trust CoinGape
CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
