The cryptocurrency leveraged market, particularly driven by Ethereum (ETH), experienced significant turmoil in the last 24 hours, with over $506 million in net liquidations. A staggering 143,027 traders were liquidated, with long traders accounting for more than $430 million, while short traders faced liquidations totaling $77 million.
The broader cryptocurrency market mirrored the correction seen in major stock indexes, with the S&P 500 declining by 0.6 percent and the NASDAQ index dropping by 1.5 percent within the same time frame.
Top Reasons Why Crypto Dropped Today
One of the primary reasons behind the recent downturn in the cryptocurrency market is the notable decrease in institutional investor demand for Bitcoin and Ethereum. For instance, U.S.-based spot Ether ETFs have witnessed a net cash outflow exceeding $250 million over the past two days, with BlackRock’s ETHA leading the trend.
Similarly, U.S.-based spot BTC ETFs, spearheaded by BlackRock’s IBIT, have seen a net cash outflow surpassing $130 million in the same period. On-chain data analysis also indicates a heightened selling pressure from whale investors, further exacerbating the market downturn.
What are Experts’ Midterm Expectations for Crypto Bull Market
The cryptocurrency market is eagerly anticipating the release of tomorrow’s Federal Open Market Committee (FOMC) meeting minutes and U.S. unemployment claims, which will provide valuable insights ahead of Fed Chair Jerome Powell’s upcoming speech on Friday. Moreover, the recent inflation data exceeding expectations has diminished the likelihood of a Fed rate cut in September.
The midterm outlook for the cryptocurrency market hinges heavily on the price movements of Bitcoin and Ethereum. For ETH, market analysts are closely monitoring the lower boundary of the CME gap at around $4,098, which is considered a critical support level. Technical analysis suggests that the $4,000 mark holds significant importance for Ethereum’s price stability.
On the other hand, Bitcoin’s price must maintain support levels around $113,000 to avoid a potential retracement towards $109,000 in the near future. Renowned crypto analyst Benjamin Cowen predicts a potential drop in BTC price to $109,000 in September, but anticipates a rebound in its market dominance.
As the cryptocurrency market continues to navigate through volatile waters, investors and traders are advised to stay vigilant and closely monitor key market indicators to make informed decisions.