Within the last hour, the Bitcoin (BTC) price rose to $10,180 on BitMEX before quickly reversing to $9,600. The quick rejection means that for the third time in 30 days, Bitcoinsprice has rejected at the $10,000 resistance level.<\/p>\n
Three factors that may have contributed to the volatility are: the Federal Reserves Federal Open Market Committeemeeting, the liquidation of $14 million worth of short contracts, and the continued resilience of the multi-year resistance area from $10,000$10,500.<\/p>\n<\/p>\n
BTC paints a darth maul candle at BitMEX. Source: Tradingview<\/p>\n
The Fed had an FOMC meeting shortly before the sudden spike in Bitcoins volatility. During the meeting, Federal Reserve chairman Jerome Powell stated the jobmarket may have hit rockbottom.<\/p>\n
Since March, institutional investors have been cautious about the stock markets short-term trend due to the state of the labor market.<\/p>\n
The unemployment rate was initially projected to remain in the double digits and this was a major concern to high-net-worth investors. To shield against downside risk, these investors took shelter in safer alternatives like low-risk bonds.<\/p>\n
According to Welt market analyst Holger Zschaepitz, Powell said:<\/p>\n
We want investors to price in risk like markets should. [He] says Fed would never hold back support for the economy because it thinks asset prices are too high. Popping asset bubble would hurt job-seekers.<\/p>\n
Despite the positive data coming out of the FOMC meeting, both the United Statesstock market and Bitcoin price dropped after it was held.<\/p>\n
The trend of the largest digital asset on CoinMarketCap and equities suggests that as soon as the Fed meeting ended, a sell-the-news pullback occurred.<\/p>\n
Within a 30-minute window, $14 million worth of Bitcoin shorts were liquidated on BitMEX alone. Compared to other exchanges, the price of BTC rose higher on BitMEX by around $100.<\/p>\n<\/p>\n
BitMEX XBTUSD liquidations. Source: Skew<\/p>\n
As the price of Bitcoin hit $9,600 in a 4% drop within less than 15 minutes, another $2 million worth of longs were liquidated.<\/p>\n
In total, in about an hour, around $16 million worth of futures contracts were liquidated in quick succession.<\/p>\n
Due to the decline in spot volume in the Bitcoin market since early May, the futures market has accounted for a large portion of the daily BTC volume.<\/p>\n
When tens of millions of dollars worth of futures contracts are liquidated in a highly volatile price move in a short period of time, it can cause the price of BTC to move quickly ineither direction.<\/p>\n
Since mid-2019, the $10,000$10,500 area has acted as a strong resistance zone for Bitcoin. Every time the price of BTC attempted to break out of this range, it was met with a brutal pullback.<\/p>\n
Recently, the price of Bitcoin surpassed $10,000 moments before its big fall to $9,600. Cryptocurrency investor Koroush AK said the move reduced the importance of $9,850 as another resistance level.<\/p>\n
He said:<\/p>\n
This move was significant. $9,850 is now less important as a resistance. $10,000 is now more important.<\/p>\n
In the near-term, the sudden upsurge may weaken the barrier BTC has to break to see an extended rally. However, it also leaves BTC vulnerable to a steeper pullback given that it hit an important liquidity area.<\/p>\n
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See more here:<\/p>\n
3 Reasons Why Bitcoin Price Continues to Reject at $10,000 - Cointelegraph<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" Within the last hour, the Bitcoin (BTC) price rose to $10,180 on BitMEX before quickly reversing to $9,600. The quick rejection means that for the third time in 30 days, Bitcoinsprice has rejected at the $10,000 resistance level. Three factors that may have contributed to the volatility are: the Federal Reserves Federal Open Market Committeemeeting, the liquidation of $14 million worth of short contracts, and the continued resilience of the multi-year resistance area from $10,000$10,500. Continue reading