Bitcoin Bulls vs. Bears: Will Liquidations Trigger a Price Surge?

Recent data reveals a fascinating dynamic in the Bitcoin market. While the price has remained relatively stable between $103,000 and $106,000, a significant increase in long liquidation dominance has occurred. This metric, tracked by CryptoQuant, indicates a surge in liquidations of bullish positions, reaching 2,200 BTC in the past week – the highest level recently. Typically, such a surge would precede a price crash; however, the absence of a major price drop suggests strong underlying buyer support. Analyst Axel Adler Jr. points out that previous instances of similar long liquidation spikes were followed by bullish reversals. He suggests a further 5-7% rise in this metric could trigger a market shift, washing out bearish positions and initiating a price rally. Adding to this bullish signal, data from Santiment shows that large Bitcoin wallets (holding over 10 BTC) have increased by 231 addresses over the past ten days, while smaller retail wallets have decreased by 37,465. This divergence suggests whales and sharks are accumulating while retail investors are exiting. This combination of large-wallet accumulation and retail exodus is often seen as a bullish indicator. Despite these positive on-chain signals, Bitcoin has recently experienced a short-term price drop, falling below the $103,000-$106,000 support levels, potentially due to geopolitical factors such as recent U.S. military strikes on Iran. The market's reaction to these events mirrors its response to similar tensions in 2020. The overall situation presents a complex interplay of on-chain indicators suggesting bullish momentum despite recent price corrections and geopolitical uncertainty.

(Source: https://www.newsbtc.com/news/bitcoin/bears-washed-out-bitcoin/)