Bitcoin Rebounds to $62,000 Amid Easing Selling Pressure After Mid-East Turmoil

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Bitcoin’s price didn’t start the month as anticipated, plummeting to around $60,000 on Thursday, October 3rd. Analysts suggest this decline was triggered by escalating turmoil in the Middle East after Iran launched missiles into Israel. Despite the downturn, Bitcoin made a swift recovery to close the week, bouncing back above $62,000 on Friday. On-chain data indicates that this recovery is linked to a decrease in selling pressure.

An analyst known as Caueconomy on the CryptoQuant platform recently discussed the impact of liquidating long positions in the Bitcoin futures market. The analyst explains that these ongoing liquidations have eased the bearish pressure on Bitcoin’s price. Futures contracts allow investors to speculate on the asset’s price; a long position is taken when traders expect Bitcoin’s price to rise. However, they incur losses when the asset’s price falls below the contracted price. Data from CryptoQuant reveals that over 4,000 long positions were liquidated following the price drop on Tuesday, October 1st, marking the second-largest liquidation event this year. Despite significant selling activity and resulting losses, such liquidations can signal crucial market sentiment shifts.


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Periods of steep losses and market liquidations often set the stage for local price bottoms. According to Caueconomy, sharp declines in purchased contracts during these periods reduce market selling pressure. This reduction could pave the way for a short-term recovery in Bitcoin’s price, provided there is increased buying interest from investors.

Bitcoin seemed to establish a local bottom around the $60,000 mark before rebounding. As of now, the cryptocurrency trades around $62,000, showing more than a 2.5% increase in the past day. However, this rebound hasn’t completely erased the 5% decline sustained over the past week. With selling pressure easing and considering Bitcoin’s historically strong performance in October, it seems only a matter of time before Bitcoin reaches $65,000 once again.