Bitcoin’s Wild Four Hours: New Record of $73K, Tumble to $69K, Rebound to $71K, $360M in Liquidations

The
cryptocurrency
market
saw
a
sudden
burst
of
volatility
Tuesday,
with
bitcoin

(BTC)
climbing
above
$73,000
for
the
first
time
ever
before
suddenly
slipping
nearly
6%
from
those
levels,
before
modestly
rebounding.

At
press
time,
bitcoin
was
changing
hands
at
$71,150,
down
about
2%
over
the
past
24
hours
and
outperforming
the
CoinDesk
20
Index’s
(CD20)
3%
drop.

Ether

(ETH)
was
also
outperforming
with
a
2%
decline,
while
ripple

(XRP),
dogecoin
and
litecoin

(LTC)
tumbled
6%-8%.

Avalanche’s
native
token

(AVAX)
was
the
only

notable
gainer
among
the
CoinDesk
20
constituents,
up
15%
for
the
day.

The
volatility
liquidated
over
$360
million
worth
of
leveraged
derivatives
positions
across
all
cryptos,
mostly
longs
betting
on
rising
prices,

CoinGlass
data
shows.
This
was
the
largest
long
flush-out
since
the
March
5
correction.

Crypto
investment
services
firm
Matrixport
noted
in
a
Tuesday
market
update
that
bitcoin’s
rally
was
showing
signs
of
waning
momentum.

The
report
highlighted
the
divergence
between
high
BTC
prices
and
declining
relative
strength
index
(RSI),
a
widely
followed
momentum
indicator
based
on
the
speed
and
size
of
price
changes
for
an
asset.

“We
have
been
bullish
on
bitcoin
since
the
end
of
January,
but
the
risk-reward
analysis
favors
a
period
of
consolidation,”
Matrixport
analysts
said.
“This
bull
market
still
has
legs,
but
the
divergence
between
a
declining
RSI
and
still
high
Bitcoin
prices
could
signal
that
Bitcoin
needs
to
consolidate
before
rallying
again.

The
$69,000
area
is
a
key
price
level
for
bitcoin,
reminiscent
of
its
2021
bull
market
peak,
where
prices
could
find
short-term
support.

U.S.
inflation
in
February

was
hotter
than
hoped
earlier
Tuesday,
with
the
Consumer
Price
Index
(CPI)
rising
3.2%,
slightly
higher
than
analyst
expectations.
Sticky
inflation
this
year
could
discourage
the
Federal
Reserve
from
cutting
interest
rates.

Aurelie
Barthere,
principal
research
analyst
at

Nansen.ai,
said
the
inflation
reading
is
only
a
short-term
blip
for
cryptocurrencies,
and
is
unlikely
to
impact
the
bull
market
over
the
coming
weeks.

“There
is
too
much
bullish
momentum
in
crypto,”
Barthere
said
in
an
emailed
note.
“What
will
probably
happen
is
a
repricing
of
expected
Fed
rate
cuts.
We
do
not
expect
a
significant
sell-off
for
crypto
as
this
repricing
has
happened
in
the
past
few
months
without
questioning
the
bull
market.”