Mike Smith
3 days ago
The cryptocurrency market started the week with an alarming signal: the price of Bitcoin fell below $80,000 amid growing geopolitical tensions and tougher rhetoric about trade duties. Decrease in quotations occurred synchronously with the growth of liquidations of derivative positions, the volume of which exceeded $590 million over the day. At that, more than $207 mln was accounted for long positions, which were in vulnerable position due to sharp change of market vector.
Investors are increasingly betting on the fall of BTC. According to Coinglass data, the ratio of longs to shorts has fallen to 0.89, and the share of “shorts” has reached almost 53%. This reflects the growing skepticism of market participants towards the short-term dynamics of the flagship cryptocurrency.
Negative dynamics also affected the traditional markets: Nasdaq 100, S&P 500 and Dow Jones indices went into correction, showing the worst weekly results for the last four years. Such a synchronized decline in assets with varying degrees of risk indicates a systemic deterioration in investment expectations and an increased propensity to flee to the cache.
Bitcoin lost 11.7% of its value in the first quarter, marking its weakest start to the year since 2014. Amid declining global liquidity indicators, the cryptocurrency is showing increased sensitivity to macroeconomic signals. In particular, Fed Chairman Jerome Powell's statements on the potential effects of the rate policy on inflation and growth rates became an additional pressure factor.
The broader crypto market also did not resist the wave of sell-offs: the total capitalization decreased by 2.45% to $2.59 trillion. Bitcoin continues to dominate the market structure with a 62% share, while Ethereum holds on to 8%. Ethereum derivative traders lost $72 million on long positions alone, one of the largest single-step losses in recent weeks.
The key to further movement could be the opening of stock markets early in the week. Market participants are closely watching macro indicators and new signals from regulators. The market remains highly sensitive to any signs of slowing global economic growth or increased inflation risks.
