Bitcoin’s Bullish Surge Triggers $145M in Liquidations: Will BTC Price Hit $50K in January?

The post Bitcoin’s Bullish Surge Triggers $145M in Liquidations: Will BTC Price Hit $50K in January? appeared first on Coinpedia Fintech News

The first days of 2024 marked a bullish turn for Bitcoin, with its price soaring by 8%. Surprisingly, this surge didn’t heavily impact short positions in the cryptocurrency, with only $38 million in Bitcoin shorts liquidated initially. However, a dramatic shift unfolded later, witnessing over $110 million of the total $145 million liquidation from shorts due to unexpected price surges.

Analysts note that the earlier short positions seemed unprepared for Bitcoin’s rally beyond $45,000, hinting at potential volatility ahead, especially around this price level, where spot market activities could impact perpetual swap trading.

Bitcoin’s Liquidation Heatmap: Bearish Woes and Bullish Momentum

The market shockingly witnessed a hefty $145 million in liquidations, mainly from short positions. Traders who bet on a market reversal at the year’s onset were overwhelmed by unforeseen bullish momentum. This robust Bitcoin price action signifies the continuation of the bullish momentum, setting a potent tone for the year. Surpassing the $45,000 threshold boosts market sentiment and reinforces the ongoing bullish market trend. The impending approval of a spot Bitcoin ETF in the coming weeks adds further weight to the market’s positive outlook.

Prepping for Potential Volatility Post-ETF Approval

While optimism pervades the market, investors should prepare for potential volatility, especially post-ETF approval. This phenomenon, often dubbed a “sell the news” event, might trigger a price decline after an initial rise fueled by anticipation. Traders capitalize on such events by locking in profits, affecting asset prices post-event.

Bitcoin Riding the Bullish Wave. Can it hit $50K? 

Bitcoin’s price trajectory signals a clear upward trend, notably breaking past the $45,000 resistance, now functioning as a support zone. Overcoming this significant hurdle represents a bullish turn for Bitcoin. The moving averages portray a robust bullish pattern, with the price comfortably above both the 50-day and 200-day moving averages, indicating a robust uptrend. The 50-day moving average mainly acts as dynamic support, affirming continued bullish pressure.

Moreover, the increased trading activity around the breakout point, as seen in the volume bars, reinforces this surge’s momentum. The Relative Strength Index’s climb toward overbought levels showcases the intense buying pressure accompanying the recent price surge.

For BTC to sustain this upward momentum, it must surpass the resistance level of $45,539. If successful, it could rally further to test the $47,000 resistance level, setting the stage for a potential push toward the $50,000 mark shortly.

On the flip side, a reversal in the trend could lead to a loss of momentum, causing BTC to test its support level at $44,334. If bearish sentiment intensifies, there might be a further dip to test the lower support level at $42,019 within the week.