The cryptocurrency market saw a significant amount of forced liquidations totaling over $841 million in the last 24 hours leading up to Friday, May 30th. Bitcoin’s price falling below $105k caused a ripple effect in the altcoin market, particularly impacting memecoins and triggering heavy forced liquidations for long-leveraged traders.
Coinglass data revealed that more than $747 million in forced liquidations involved long traders, with whale-long traders like James Wynn leading the pack. This surge in forced liquidations added to the short-term pessimism surrounding Bitcoin’s price.
Short traders also experienced around $80 million in forced liquidations during this time period, contributing to the growing concern of a potential long squeeze despite some optimism for a market rebound over the weekend.
Looking ahead, there is still a sense of optimism for a crypto rebound in the near future, even amidst the current downturn. Bitcoin’s fear and greed index sitting at around 60 percent indicates a level of greed among crypto traders.
The positive regulatory developments in key jurisdictions, particularly in the United States, have attracted more institutional investors to the web3 space. This has led to increased anticipation for a bullish rebound in the market, potentially setting the stage for a parabolic rally in the coming days.
However, the prevailing bearish sentiment could potentially delay any significant bullish movement, especially if Bitcoin’s price drops below $100k again. Nevertheless, if the price manages to stay above $96k, there is a possibility of a major short squeeze if Bitcoin rebounds above $110k.
The overall bullish outlook for the crypto market is supported by the growing adoption from institutional investors and favorable regulatory environments in key jurisdictions. As we navigate the coming days, adopting a wait-and-see approach may be prudent to gauge the market’s reaction, particularly in light of Bitcoin’s price movements.