September leaves behind a trail of blood and long Bitcoin selloffs
After what appeared to be a prosperous month following August’s bull run, Bitcoin has now entered an era of increasingly bearish signals. The asset had seen a number of rallies that pushed it above two-month highs, successfully breaking the $ 52,000 resistance range on several occasions. Throwing the whole market into a long period of positive sentiment.
September has now come with its own set of issues for the digital asset. The price of Bitcoin has suffered since the start of the month, ushered in by a lightning crash that rocked the market just a week after the start of September. The market continues to suffer from the aftermath of this lightning crash, which left a trail of blood on the market, and led to massive sell-offs.
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Bitcoin price crash leads to massive sales
In just a few days, the price of bitcoin rose from $ 47,000 to $ 40,000, triggering sell-offs in the market. Long liquidations totaled up to $ 860 million across all stock exchanges. The liquidations took place over two days when the price of the digital asset inevitably fell to $ 40,000 on Tuesday, September 21. Although significant, liquidations, which spanned two days, remained below the massive sales observed after the crash of September 7.
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Monday marked the start of closeouts as the market saw $ 470 million in long positions liquidated. And the following Tuesday, a total of 390 million long positions were also liquidated. At this point, the price of bitcoin had reached levels not seen since mid-August. And as the market sentiment turned negative, the price continued to plunge.
BTC longs liquated on Monday and Tuesday add up to $860 million | Source: Arcane Research
Current sales volumes remained below sales of $ 1.2 billion in early September, suggesting this current sale is more organic than previous ones. Also, it shows that the current market is more influenced by spot activity than the derivatives market.
September and its strangulation on the market
September has historically come with challenges for the crypto market. So the crash that rocked bitcoin and the broader market at the start of the month is on the mark. Crashes with at least a 17% loss in value have occurred in September over the past four years and it looks like 2021 is in line with this trend.
However, the end of September always came with better forecasts for the following month. Analysis of the charts shows that monthly crashes precede recoveries that put the market on track to regain its lost value. Set the market up for another bull run.
BTC price trading north of $43K | Source: BTCUSD on TradingView.com
The price of BTC has now rallied above Tuesday lows which saw digital assets plunge below $ 40,000. Bitcoin is currently trading above $ 42,000 at the time of writing. While the total market cap fell below $ 800 billion.
Featured image from Bitcoin News, charts from Arcane Research and TradingView.com