Bitcoin touches $71,000, faces volatility and potential sell-offs
As usual, the most beloved leading cryptocurrency, Bitcoin, is on the rise again and has touched $71,000, its highest recently. It has increased by 3% in the past 24 hours as of June 4th. With the current price at $70,900, it’s up more than 2% on the day, pushing its 30-day rise to 10%. It has hit the highest point in 2 weeks, nearing the highest level since April’s quadrennial halving event. Along with this, Bitcoin meme coins ORDI and DOG are surging in price, likewise showing the growth of BTC holistically.
This surge has caused $27 million in liquidations in the crypto market. During the New York session, BTC witnessed this increase. During the same time frame, the broader crypto market faced liquidations amounting to around $87 million.
While the $71,000 mark is an impressive milestone in the success history of BTC, it also signals potential volatility. Bitcoin’s price movements are known for being unpredictable, and sharp sell-offs can occur just as quickly as price surges.
Market volatility and holder activity?
This volatility is due to long-term and short-term holders now sitting on profits, making them more likely to buy or sell based on price movements. Essentially, the market is poised for action, and fluctuations in prices are likely to be expected. Traders should be prepared for significant price swings and remain vigilant. It's crucial to remember that the cryptocurrency market operates 24/7, making it subject to rapid changes at any time. Market sentiment can shift due to a single tweet or news article, creating a ripple effect across the entire crypto space.
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Sell-off pressure
Bitcoin price increases might trigger selling by long-term holders. A report by Glassnode indicates that as the price climbs higher, investors who have held Bitcoin between 3 months to 3 years will likely be incentivized to sell more, potentially increasing sell-side pressure. This is because the recent price rise touching $71,000 has brought most long-term holders back into profit territory. According to the Crypto Times article, "We can expect that this cohort’s incentive to sell more supply will grow should prices climb high, and elevate their unrealized profit further."
Wrapping up?
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Bitcoin bullish if: -More businesses and institutions adopting Bitcoin. -Institutional investments signaling confidence. -Supply reductions through halving events. -Positive market sentiment and media coverage. -Technological advancements enhancing utility.
If big companies and investors keep getting into it and they make Bitcoin even better, its price could keep going up. But there are also things like rules and how people feel about money that could bring the price back down. So, keep an eye on the news and how people are feeling about Bitcoin it'll give you a clue about what might happen next.
Bitcoin's future rise is pretty uncertain, but there are some things to watch out for. If people keep feeling good about it and more big players start getting involved, it could go up even more. Plus, if they make the technology behind Bitcoin even better, that could give it a boost too.