Bitcoin’s price fell by more than $8,000 in a single session on Wednesday, dipping below a crucial $33,000 support level on Bitfinex and other exchanges, as short-sellers accumulated more than 5,000 BTC in a trade that lasted over a day. The price drop comes amid the continued uncertainty around the cryptocurrency’s scalability, as well as a large sell-off by Bitfinex’s users, which came after the exchange threatened a delisting to increase the pressure on other traders.
It’s been a few weeks since the bitcoin price dipped under the $33,000 mark, and it looks like it’s going to happen again. At the time of this article, bitcoin is valued at $32,973, and is down 1.3% in the last 24 hours.Bitcoin (BTC) fell on the 8th. July below the $33,000 support level as a strong trading range threatens to be negated.
1 minute candlestick chart of BTC/USD (Bitstamp). Source: TradingView
Dealers: Next retest $31,000 for BTC
Data from Cointelegraph Markets Pro and TradingView showed that BTC/USD dipped into the $32,000 range in Thursday’s trading.
The move follows an overnight pullback from the $35,000 level when bitcoin failed to break through critical resistance.
Bitcoin is thus likely to break the bullish scenario, suggesting that it is entering the next phase of the Wyckoff distribution, with a potential upside exit around $39,000.
The loss range of $33K, and I see $31-31.4K, warned the famous trader Michael van de Poppe just before the decline began.
At the time of writing, volatility still meant that a range recovery was possible, with BTC/USD near $32,500 after a local low of $32,490 on Bitstamp.
Graph of the BTC/USD scenario of 8. July. Source: Michael van de Poppe/Twitter
Bitfinex shorts up 160% in a few hours
The recent price action came hours after new selling pressure, due in part to an unknown whale trying to short over 5,000 BTC.
As reporter Colin Wu notes, on the largest Bitfinex exchange, the 8. July to build up short positions.
Related: The data does not indicate that short selling on Bitfinex is driving down the price of bitcoin.
The mysterious Bitfinex user began shorting a stack of at least 5,219 BTC, worth $173 million at $33,000.
According to datamish, an account (or institution) borrowed bitcoins at 1 p.m. Beijing time to conduct a short sale on Bitfinex, Wu said.
At 3:03 pm, he had captured a total of 5,219 BTC, and that number continues to grow. Most short positions are not hedged.
At the time of writing, Bitfinex’s total short positions are up 160% in about two hours.
BTC shorts on Bitfinex (blue) at the price of BTC (orange). Source: TradingView
Short positions in Bitfinex were roughly balanced with long positions, according to Bybt’s data, but long positions represented more than 70% of the total.
The closure of the whale is not new. According to Cointelegraph, traders’ behavior also fluctuated in June, with Wu’s 25th trading day. June 15,000 BTC is betting on another price drop. The next day, BTC/USD again tested the $30,000 support level.
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