Bitcoin Faces Bearish Pressures Amid Global Market Downturn and Geopolitical Tensions: On-Chain Analysis and Price Predictions
Crypto News – Recent insights delve into the short-term potential of Binance CEO Changpeng Zhao’s bullish remarks amidst rising tensions in the Middle East. Although Chanpeng Zhao (CZ), CEO of Binance, has predicted that Bitcoin could surpass its previous all-time high of $61,000 in 2024, current macroeconomic events and BTC derivatives market data present a conflicting narrative.
Despite CZ’s Optimistic Halving Prediction, Bitcoin Price Faces Pressure
On Wednesday, October 11, Binance prominently featured a Bitcoin halving countdown on its platform’s homepage. During this announcement, CEO Chanpeng Zhao emphasized BTC’s historical pattern of reaching new all-time highs following each of the last three halving events in 2012, 2016, and 2020.
While the bullish sentiment from CZ is acknowledged by Bitcoin enthusiasts, recent events in the derivatives market suggest a bearish outlook for the short term. Data compiled by Coinglass indicates that BTC bulls experienced a $25 million loss on Wednesday, extending their losing streak to six days.
The Liquidation heatmap provides an overview of cumulative positions in the crypto derivatives market that have been liquidated or closed over a specified period. The chart indicates that BTC accounted for a significant portion of crypto market losses, with over $25 million worth of LONG positions (bets on BTC price increase) liquidated on Wednesday alone.
The corresponding 2% decline in the global crypto market capitalization suggests that instead of bolstering their positions by buying more BTC, investors are exiting the market. If this trend continues, BTC spot market prices could drop closer to $25,000 in the upcoming days.
Bitcoin Bears Take Charge of the Market
Bitcoin had a promising start to the month, attempting multiple times to break the significant $28,000 resistance. Notably, Bitcoin Dominance (BTC.D) reached a four-month high of 51% during this period.
However, derivatives market data indicates that the Israel-Palestine crisis has shifted momentum in favor of the bears. Between October 7 and 11, holders of BTC Long positions suffered more losses than short traders, with over $55 million worth of long positions liquidated.
The Total Liquidations metric measures the total value of closed Long positions against Shorts during a specified timeframe. The data illustrates that bears have maintained an advantage for five consecutive trading days since the geopolitical crisis between Israel and Palestine unfolded.
It remains uncertain whether highly leveraged Long traders, holding positions below current prices, will exert buy pressure to mitigate further downside in Bitcoin’s price.
BTC Price Prediction: Dropping to $25,000 Could Lead to Substantial Losses
Current market data suggests that the price of Bitcoin is likely to approach the $25,000 level in the near future. However, the In/Out of the Money metric, illustrating the entry price distribution of current BTC holders, offers a slightly less pessimistic perspective.
The data indicates a substantial support cluster, with holders purchasing Bitcoin around the $26,300 level. Approximately 1.95 million addresses acquired 811,310 BTC at the maximum price of $26,695. If they hold steady, they may mitigate further losses.
However, if bears breach that support level, BTC could experience a rapid drop towards $25,000. On the positive side, if Bitcoin’s price reclaims $30,000, the bulls could regain control. In this scenario, 2.5 million addresses purchased 1.06 million BTC at an average price of $28,300.
If these address clusters opt to book profits early, they could potentially trigger an immediate bearish reversal in Bitcoin’s price. However, if the resistance cluster cannot hold, the psychological resistance at $30,000 may be the next significant level.
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