Coinbase Analyst Predicts Short Squeeze Opportunity as Crypto Market Shows Minor Upturn

Coinbase Analyst Warns of Short Squeeze Potential with Recent Crypto Market Recovery

Coinbase Analyst– The cryptocurrency market has begun to show signs of a tentative recovery after a chaotic Monday, which saw over $1 billion in leveraged crypto positions liquidated and major tokens like Bitcoin and Ether plummet by up to 20%.

On Tuesday, Coinbase researcher David Duong highlighted the potential for a short squeeze due to increased buying activity on centralized exchanges. We expect some market jitters to continue in the short term, but there’s a chance that shorts could be squeezed, which might lead to a market rebound in the coming days, Duong noted.

In the past 24 hours, liquidations in the cryptocurrency market have been nearly evenly split between long and short positions. According to Coinglass data, of the $425 million in total liquidations, approximately $212 million were long positions, while just over $212 million were short positions.

Major cryptocurrencies, including Bitcoin and Ether, have seen gains of over 6% and 7%, respectively, over the last 24 hours, according to The Block’s Prices Page. The global cryptocurrency market capitalization has risen to $2.04 trillion, marking a 5.4% increase in the past day, as reported by Coingecko.

Despite the positive movement, Duong emphasized that several factors are still impacting the market. There are Bitcoin and Ethereum distributions by Genesis as part of its bankruptcy liquidation plan. Additionally, the unwinding of Japanese yen-based carry trades might be influencing decisions by Mt. Gox creditors who are receiving their Bitcoin at this time, Duong added.

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