Can Ethereum Classic Price Survive $800K Liquidations?

The cryptocurrency market is facing significant challenges following July’s volatility. Ethereum Classic price has not been immune to these headwinds, dropping 5.4% over the past week and an additional 2% in the last day to trade at $21.34 during US business hours on Tuesday.

ETC Futures Liquidations Surge

The Ethereum Classic futures market faced more liquidations as sell-side pressure intensified on Thursday and Friday. According to Coinglass data, long traders received the biggest beating, with over $800k liquidated in 24 hours. Approximately $50k in shorts was liquidated, undermining the intense overhead pressure that saw Ethereum Classic price fall to retest $20 support.

In total, futures traders lost roughly $266 million through liquidations, with long positions accounting for $197 million and $67.5 million affecting short positions.

Over the past 24 hours, a staggering 92,214 futures traders were liquidated. The largest single liquidation order was placed on OKX, amounting to $3.9 million of ETH-USD-SWAP.

Will Ethereum Classic Price Crash Or Bounce Back?

Ethereum Classic price is in a precarious situation. Support at $20 must hold to increase the chances of a recovery this weekend. Its current position below all three bull market indicators, the 20-day, 50-day, and 200-day Exponential Moving Averages (EMAs), gives sellers the upper hand.

As the moving averages gravitated downwards, two death crosses appeared, which added credibility to the downtrend. This means that some traders may continue shorting the ETC price in an attempt to weaken the $20 support.

Based on a previous ETC price forecast, losing the $20 support is dangerous for the original Ethereum chain, hinting at sweep-through liquidity at $19.5 and $18.5. The Relative Strength Index (RSI) flaunts a bearish divergence, which is highly likely to encourage traders to short ETC.

There’s a glimmer of hope for ETC price. A falling wedge pattern has formed on the four-hour chart, suggesting a potential 9% price surge to $23.

A falling wedge forms as price action creates a series of lower highs and higher lows converging into a wedge shape. Traders often enter long positions at the wedge’s breakout, targeting a price increase equal to the wedge’s height.

Stop-loss orders below the wedge are crucial for risk management. On the upside, the 9% target equals the distance between the first swing high and the first swing low, which is appended on the breakout point.