Yesterday, the market saw the highest daily number of liquidations since June 13, 2022. Long liquidations hit $562 million in just 24 hours.
Most of these losses were seen in the BTC and ETH markets. However, total long liquidations in other altcoins reached as high as $144 million. The reason is the collapse of Bitcoin’s upside price structure and its steep decline.
BTC price action
On the morning of August 19, Bitcoin broke out of the $23,200 area and started an accelerated decline. By the end of the day, it had bottomed out at $20,785 and fell 10% on the day.
Support was provided by the already validated lower line of the ascending parallel channel (green circles). The horizontal plane (red line), which was already acting as resistance and support, turned out to be an additional area of support. With that, Bitcoin’s price structure maintains the pattern of a rising parallel channel, but has lost its median, which has served as support since late July.
Unfortunately, yesterday’s decline violated the uptrend structure that has been in place since the June 18th low of $17,592. So far, bitcoin has made higher lows (HL) and higher highs (HH) regularly. However, we see that the sharp decline has led to the generation of the first lower low (LL). If Bitcoin forms a lower high (LH) in the coming days, it will signal a resumption of the downtrend.
BTC/USD chart from Tradingview
Biggest long liquidations since June
Bitcoin’s demise has resulted in red candles on all major cryptocurrency market indices. In the last 24 hours, Ethereum (ETH) lost almost 13%, Binance Coin (BNB) over 6%, XRP almost 10%, Cardano (ADA) 12% and Dogecoin (DOGE) over 9%.
The sharp declines resulted in liquidations of long positions in the cryptocurrency market totaling $562 million, according to data from Coinglass yesterday. These are the biggest losses traders have suffered since June 13, when long liquidations totaled $685 million. It is worth noting that due to the high daily BTC volatility at the time, losses on short positions were equally large, amounting to as much as $468 million. Yesterday, short-term liquidations were relatively small, reaching $79 million.
The vast majority of yesterday’s liquidations involved the BTC and ETH markets. Within 24 hours, traders lost $210 million and $208 million, respectively. The remaining $144 million were long liquidations on altcoins. For example, losses on the Ethereum Classic (ETC) market totaled almost $17 million and on the Solana (SOL) market a little over $10 million.
Above-average liquidations are also confirmed by data from Glassnode. Losses in the futures markets monitored by this data provider totaled more than $155 million yesterday. And while these numbers are definitely lower than those reported above, yesterday’s bar of lengthy liquidations definitely stands out from anything that’s happened over the past month.
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