Over the past 24 hours, the crypto market has suddenly rebounded after a negative decline.
In the early morning of December 10th, Beijing time, BTC fell back to $94,355.91 in the short term, and then quickly rebounded to $96,400, which lasted about 10 minutes. During the same period, Ethereum (ETH) fell 10% to $3,590, and mainstream currencies Cardano (ADA), Avalanche (AVAX) and XRP (XRP) fell nearly 20%.
According to Coinglass data, as of press time, more than 560,000 people in the crypto network have been liquidated in the past 24 hours, mainly long orders, with a total liquidation amount of US$1.707 billion. The largest single liquidation occurred on Binance, which was ETH/USDT worth US$19.6911 million.
Since December, the cryptocurrency market has experienced two consecutive large-scale liquidations (the last one was US$1.1 billion on December 5), and the scale of this round has reached a two-year high.
Is the bull market entering a period of adjustment?
Analysts believe that the cryptocurrency market has recently shown some signs of weakness, with trading volumes shrinking and long-term holders starting to take profits. Markus Thielen, founder of 10x Research, believes that this may be a normal phenomenon before the bull market enters a period of adjustment. He advises traders to pay close attention to the performance of individual currencies and focus on the most reliable projects.
Digital asset hedge fund QCP also noted that options market traders are shifting from bullish to neutral, and expects the market to remain range-bound until the end of the year. “While we remain structurally bullish, spot [prices] are likely to remain in this range for the remainder of the holiday season,” QCP said in a report on Monday.
Some analysts pointed out that Bitcoin failed to maintain its upward trend after breaking through $100,000, which triggered some panic. Alex Kuptsikevich, chief market analyst at FxPro, pointed out that the decline of Bitcoin has suppressed the buying enthusiasm of the entire market. He believes: “The recent correction of Bitcoin may help the market digest the previous gains and lay the foundation for the subsequent market. Combined with technical analysis, we expect the next upward target to be around $120,000. However, the market still needs to pay close attention to changes in the macroeconomic environment and regulatory policies.”
Technical indicators: 20-day EMA is key
Analyst Rakesh Upadhyay noted that Bitcoin’s repeated failure to sustain above the psychologically critical level of $100,000 could result in a pullback to the 20-day EMA ($95,673).
Tradingview data shows that BTC’s strong rebound from the 20-day moving average will indicate that bulls are still dominant and every small dip will be bought. This will increase the possibility of retesting the all-time high of $104,088. A breakout and close above $104,088 could start the next uptrend to $113,331 and then to $125,000.
Conversely, if the price continues to move lower and breaks below the 20-day EMA, it will suggest that the bulls are booking profits. The BTC/USDT pair can drop to $90,000 and eventually to the 50-day SMA ($84,719).