By Key Points
- Bitcoin breaks critical support at $66,500, triggering bearish sentiment.
- Historical patterns suggest a potential 10% drop to $60,000.
- On-chain data highlights liquidation risks with over-leveraged traders.
- BTC trading volume drops by 26%, signaling reduced market activity.
Bitcoin crash fears are rising as the cryptocurrency has breached a crucial support level at $66,500, signaling that the market could be on the verge of a significant downturn.
Historically, when BTC fails to hold above key levels, a major price drop often follows. This time, traders are bracing for a potential 10% decline, which could push the price down to $60,000.
CRYPTO BREAKING NEWS
Bitcoin Crash Imminent? BTC Breaches Crucial Level. Bitcoin (BTC), the world’s largest cryptocurrency by market cap appears bearish and is poised for a notable price decline in the coming days. The bearish outlook is driven by overall market sentiment and… pic.twitter.com/e9ba6g1wBo— InnovatekMobile (@Neome_com) October 23, 2024
BTC Breaks Key Support, Signals Bitcoin Crash Risk
Bitcoin’s latest move has heightened fears of a crash, as BTC dipped below its critical $66,500 support level. This level has been a crucial battleground for bulls and bears, but with BTC failing to hold above it, the market is now poised for a decline.
The bearish signals are also supported by a “bearish engulfing” candlestick pattern seen on the daily chart, which has previously led to significant drops.
Since March 2024, BTC has touched this level more than six times, with each instance followed by a price decline of over 20%. Now, with Bitcoin once again below this key level, a similar plunge seems possible.
Analysts are watching for a daily close below $66,400, which could lead to a sharp 10% crash, potentially bringing BTC down to the $60,000 mark.
On-Chain Data Backs Bitcoin Crash Concerns
On-chain metrics, which show increasing bearish sentiment, further amplify the risk of a Bitcoin crash. According to Coinglass, the BTC Long/Short ratio has dropped to 0.93, indicating that more traders are betting on a price decline.
This ratio highlights growing pessimism in the market, suggesting that traders expect further downside for Bitcoin.
Additionally, open interest in Bitcoin futures has fallen by 4.2% over the past 24 hours, a sign that many long positions are being liquidated as traders react to the recent price breakdown.
As BTC struggles to find support, liquidation risks are rising, particularly around key levels identified by analysts.
Major Liquidation Levels to Watch
According to Coinglass data, the next major liquidation points are at $65,710 on the downside and $68,150 on the upside.
If Bitcoin’s price falls to $65,710, it could trigger the liquidation of over $558.2 million in long positions.
On the other hand, if sentiment shifts and Bitcoin rises to $68,150, nearly $1.31 billion in short positions could be wiped out.
This creates a high-stakes scenario, where either a Bitcoin crash or a sharp rebound could lead to massive liquidations, further amplifying market volatility.
Bitcoin Trading Volume Drops Amid Crash Fears
Adding to the concerns, Bitcoin’s trading volume has plummeted by 26% over the past 24 hours. Lower trading volumes generally indicate reduced market participation, suggesting that many traders and investors stay on the sidelines, awaiting a clearer direction.
This lack of volume could make the market more prone to sharp price moves, whether it’s a crash or a rebound.
At the time of writing, Bitcoin is trading at nearly $66,390, having dropped by 1.1% over the past day. With technical indicators, on-chain metrics, and liquidation risks all pointing to a potential downturn, the market appears to be bracing for a possible Bitcoin crash.
If BTC fails to recover above key resistance levels soon, the $60,000 mark could be the next target for bearish traders.
