This price action appeared to be consistent with how the asset has performed since peaking at $81,255 late on Aug. 24. However, while it initially found support above $79,500, the cryptocurrency has seen that level decline to $79,000.
According to market data, the digital asset failed to breach the threshold after 5:00 a.m. EST, getting only as high as $78,830. In contrast, each wave of sell-offs has left the price of bitcoin with lower lows, supporting the notion that the rally is losing steam.
Bitcoin Liquidations Ease as Long Bets Take the Bigger Hit
Meanwhile, bitcoin’s price action over the last day resulted in significantly reduced liquidations, with leveraged long bets accounting for the larger chunk. According to Bitstamp data, liquidations on bitcoin topped $88 million, with wiped-out long bets reaching $77 million. This trend was consistent across the broader cryptocurrency market, where total liquidations surpassed $302 million, split between $247 million in leveraged longs and $55 million in short bets.
Days after the price spike, many observers, including high-profile figures like BitMEX founder Arthur Hayes, have tied the cryptocurrency’s performance to actions by the U.S. Treasury. Still, there is no consensus as to how long bond buybacks will sustain bitcoin’s upward trajectory. While Hayes sees this as the beginning of a bull run, others, such as Han Tan, chief market analyst at Bybit, remain cautious.
Bybit Analyst Flags Macro Risks That Could Derail Bitcoin’s Rally
While agreeing with the general notion that bitcoin’s latest surge was triggered by a reawakening of the debasement trade and then amplified by a short squeeze, Tan insists the cryptocurrency still has major macroeconomic risks to overcome before this recent spike truly evolves into a sustained bull run.
“Looking solely at the charts, $BTC bulls must next overcome the 50-week simple moving average that exerted strong resistance today. A return to the $82.5k–$83k region would surpass the breakeven price for many ETF investors, and may entice more fresh funds in from the sidelines,” Tan told Bitcoin.com News.
Nevertheless, the Bybit analyst highlighted risks associated with bitcoin’s upward trajectory, which has been heavily dependent on macro signals. He warned that $BTC’s rally may run out of momentum “if U.S. Treasury Secretary Scott Bessent offers greater nuance to his so-called ‘Treasury twist’ that in turn dampens concerns surrounding the U.S. fiscal deficit.”
Similarly, an overtly hawkish signal from Fed Chair Kevin Warsh’s speech at Jackson Hole this Friday may also force bitcoin and other cryptos to surrender recent gains, Tan argued. As of 4:30 p.m. EDT on Wednesday, $BTC is exchanging hands just above $78,250 per coin. Over the course of the day, the leading crypto asset is down roughly a percentage point at press time.
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