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In response to the first-quarter earnings of tech giants Alphabet and Microsoft, investors have propelled Bitcoin (BTC) to surge past the $28,000 mark.
As of recent trading, the largest cryptocurrency by market capitalization was valued at over $29,008, representing a 2.39% increase in the last 24 hours. BTC’s price had been relatively stable throughout Tuesday until it experienced a surge shortly after the closing of US equities markets.
BTC Surges as Google and Microsoft Earnings Beat Expectations
BTC’s late surge coincided with both Google parent Alphabet and Microsoft slightly surpassing analysts’ expectations. Additionally, data from analytics firm Coinglass showed that around $11.3 million of BTC short positions had been liquidated since 4 p.m. ET. These short squeezes have historically tended to accelerate price jumps.
Notably, the second-largest cryptocurrency by market value, Ether (ETH), followed a similar pattern and rose 1.8% to change hands at around $1,869. ETH had slid as low as $1,804 on Tuesday morning.
Major equity indexes closed in the red on Tuesday afternoon, a day after embattled First Republic Bank (FRC) said in its quarterly results that it had lost $100 billion in deposits, renewing anxiety about regional banks.
On Tuesday afternoon, significant equity indexes concluded in negative territory following a bleak announcement from First Republic Bank (FRC) in their quarterly report, revealing a loss of $100 billion in deposits, causing renewed concerns about regional banks.
This announcement comes after both Silicon Valley and Signature banks crumbled the previous month. As a result, First Republic’s stock plummeted by nearly 50% on Tuesday.
The S&P 500 and the Nasdaq Composite, which is heavily oriented towards technology stocks, both finished down 1.5% and 1.9%, respectively, while the Dow Jones Industrial Average (DJIA) was down by 1% at the end of trading.
Meanwhile, in the bond markets, the yield on the two-year Treasury note fell by 19 basis points to 3.94%, while the 10-year Treasury yield dropped by approximately 11 basis points to 3.40%.
Edward Moya, senior market analyst at foreign exchange market maker Oanda, wrote in a Tuesday note that “this deep into earnings season, it seems the outlook isn’t too bad, and that should mean the [Federal Reserve] can stay on their tightening course, with the risks of a June hike still remaining on the table.”
Moya added that “after this round of earnings and the latest consumer confidence report, the one thing that everyone can agree upon is that personal consumption is going to be a lot weaker going forward.”
BTC Rally Leads to Over $70M in Liquidations for Short Traders
Bitcoin’s recent price surge has left many short traders in a difficult position. Over the past few weeks, the price of BTC has increased significantly, breaking through key resistance levels and reaching all-time highs.
This rally has been driven by a combination of factors, including increased adoption by institutional investors, growing mainstream acceptance, and speculation by retail investors.
While the rally has been great news for long traders who have been able to profit from the price increase, it has been a painful experience for short traders who were betting on the price of BTC to fall. As the price of BTC continued to rise, many short traders found themselves in a difficult position, with their positions being liquidated due to margin calls.
According to data from the crypto analytics firm Bybt, over $70 million in short positions were liquidated in just one hour on April 23, 2021. This massive liquidation event occurred as the price of BTC surged past the $55,000 mark, catching many short traders off guard.
The liquidation of short positions can be a brutal experience for traders, as it often leads to significant losses. When a trader’s position is liquidated, their margin is called, and their position is closed out. This means that the trader is forced to sell their position at the market price, which can be much higher than the price they originally paid.
In addition to the financial losses, the liquidation of short positions can also have a psychological impact on traders. The fear of future losses can cause traders to hesitate or make rash decisions.
While the recent BTC rally has been a challenging time for short traders, with many experiencing significant losses due to margin calls and liquidations. It has also been a reminder of the importance of proper risk management and the need to always be prepared for market volatility.
As the crypto markets continue to evolve, it is essential for traders to stay informed and adapt their strategies accordingly.
Bitcoin’s Recovery Phase Could Result in a Breakthrough from the $30,000 Mark
According to a recent analysis, Bitcoin’s price is showing signs of an upward trend and trying to maintain its position above the 20, 50, 100, and 200-day Daily Moving Average.
Over the last 24 hours, there has been a surge of $40.26M in the Bitcoin liquidation rate, indicating that BTC’s recovery phase could result in a breakthrough from the $30,000 mark.
In the last month, Bitcoin’s price has risen by 3.61%, and in the last three months, it has increased by 25.76%. The liquidation rate of Bitcoin has surged to $20.63M in the last 12 hours, which confirms the positive trend of the cryptocurrency.
To reach the long-term goal of $35,000, Bitcoin’s price needs to maintain its uptrend momentum and keep buyers’ accumulation rate. The majority of traders are sitting on the long side, indicating that Bitcoin’s long-term goal is clear. In the current trading session, Bitcoin’s price is at $29,008, and the trading volume has increased by 37%.
Although technical indicators indicate that Bitcoin is in a recovery phase, its trading volume is still below average, and it needs to grow in order to maintain this phase. This recovery phase of Bitcoin can be seen as a resurgence from its own ashes.
Technical indicators suggest the recovery phase of Bitcoin from its own ashes. The Relative Strength Index (RSI) is at 54 and heading towards the overbought territory from neutrality, indicating an upward trend.
Meanwhile, the Moving Average Convergence Divergence (MACD) line is returning towards the signal line for a positive crossover, exhibiting the sustainability of Bitcoin.
Bitcoin’s market dominance is at 48.25%, dominating the cryptocurrency market. Although Bitcoin has gained around 42.91% during the last six months and 75.46% year to date, investors need to wait until Bitcoin’s price surges out of the $30,000 resistance level to maintain its recovery phase.
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