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Leveraged Bitcoin Traders Flushed Out In Epic Overnight Crash  

Leveraged Bitcoin Traders Flushed Out In Epic Overnight Crash  

The price of Bitcoin was rangebound on early Friday around the $56k handle. The world’s largest cryptocurrency began to decline during the US cash session to about $54k-$53k handle by late afternoon. Then at midnight into the early hours of Saturday morning, Bitcoin experienced a massive liquidation and crashed into a bear market around the $42k level. Price has recovered some, now trading around $47k. 

So far, Bitcoin has found support on the daily 200sma. 

The plunge is just another sign of risk aversion sweeping across global markets as equities sink and government bonds bid. Spiking inflation is forcing central banks to tighten monetary policy, reducing liquidity for risk assets. The omicron variant of COVID-19 has also compounded risk aversion as it derails the global economic reopening. 

Bloomberg quoted Vijay Ayyar, head of Asia Pacific with crypto exchange Luno in Singapore, who said the action overnight was leveraged buyers of Bitcoin being flushed out. 

“Markets have also been jittery with all the uncertainty around omicron, with cases now appearing in many countries,” Ayyar said. “It’s hard to say what that means for economies and markets and hence the uncertainty.”

Today’s global cryptocurrency market cap is $2.28 Trillion, down 17.5% in the last 24 hours. Total cryptocurrency trading volume in the last day is at $236 billion. Bitcoin’s market cap of all crypto is 38.68%. 

El Salvador President Nayib Bukele is using the dip to buy even more Bitcoin. 

Could the bottom be in around $42k handle or is there more downside ahead?  

Tyler Durden
Sat, 12/04/2021 – 07:15

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