Bitcoin Crashes Below $79K As $650M Liquidations Rock Crypto Market

On January 31, Bitcoin faced intense selling pressure as prices slid to $75,500, marking a weekly decline of nearly 13%. The move pushed Bitcoin below the major support level and rattled the wider digital asset market.

Within a single hour, liquidations of $650 million were recorded, as indicated by Coinglass data on January 31. This decline marked the continuation of a pullback that began when Bitcoin could not remain above $90,000 in this cycle.

Sharp Price Drop Triggers Liquidations

The recent fall contributed to the larger swings observed in the past week. After remaining around $90,000, Bitcoin suddenly dropped and lost around 17% of its value from the local high.

Market analysts stated that the recent fall came after a known technical indicator related to long-term trend movements. Rekt Capital clarified that in previous cycles, a fall occurred after a bull market EMA crossover.

In previous cases, such actions did not mark the end of the uptrend. It was a cooling-down period before it continued. The liquidations accelerated the decline. When the prices dropped below the significant support levels, there were many stop-loss and margin calls.

This contributed to the selling pressure and caused the Bitcoin price to decline rapidly. The large number of liquidations indicates that there was a lot of leverage accumulated during the previous rally.

Long-Term Chart Structure Still Intact

Even in a sharp fall, the long-term charts indicate a stronger rise. On the weekly chart, Bitcoin continues to form higher highs and higher lows. A Triple Exponential Moving Average, which is a measure of trend strength, has been forming a moving support area over several cycles.

Looking back at the historical data from 2015 to 2021, the prices tend to fall back to this moving average level during strong bull markets.

The pull-backs during those periods appeared to be serious but turned out to be reset periods, not final tops. During the 2017 and 2020-2021 cycles, Bitcoin fell back to the same area before rising again.

The current rise in this area is uncomfortable, but it has happened before. The important thing is that the moving averages themselves have upward slopes, indicating that the long-term trend is not completely derailed.

Bitcoin Whales Accumulate as Retail Steps Back

While the prices are falling, the large holders appear to be doing the opposite. CW observed that whale wallets are continuously purchasing Bitcoin despite the falling market.

It has been observed that the whales on Binance Futures have purchased around $608.37 million of BTC in the last ten hours, while the OKX whales purchased another $440.06 million.

Also Read: Bitcoin Stabilization Near $84,000 Could Signal Next Major Rally