The increasing frequency with which Bitcoin attains higher support levels combined with a lack of significant speculation in the derivatives markets implies a slim chance of its price dropping to $50,000 in the near future, says Dylan LeClair, a senior analyst at UTXO Management.
In his analysis dated April 7, LeClair posits that a rise in Bitcoin’s price to the $70,000-$75,000 bracket could exert substantial pressure on short sellers.
LeClair observes, “As we’ve consolidated, an increasing amount of short liquidations are building from 70-75k.”
Data from CoinGlass suggests that a surge to $70,000 could trigger liquidations worth approximately $174.17 million.
Should Bitcoin reach $75,000, it would lead to the liquidation of about $830 million in short positions, indicating a potential price increase of 7.8% from its present $69,344.
This forecast mirrors a similar 7.5% decline on March 15, which resulted in $525.2 million of liquidations.
Despite the possibility of a significant drop in Bitcoin’s price to $50,000 triggering massive liquidations of long positions, LeClair deems such a scenario unlikely given the pattern of higher lows and the current stability of the derivatives market.
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He acknowledges the possibility but considers it improbable, citing Bitcoin’s last fall below $50,000 on February 13 to $49,725, after touching $50,000 the day prior—a milestone not seen since December 2021.
Supporting his analysis, LeClair refers to recent developments like BlackRock’s update to its Bitcoin ETF prospectus on April 5, which now includes five prominent Wall Street firms as new authorized participants, including ABN AMRO Clearing, Citadel Securities, Citigroup Global Markets, Goldman Sachs, and UBS Securities.
The crypto community is also closely watching Bitcoin’s price as it approaches the halving event scheduled for April 20, which reduces miner block rewards by 50%.
Historical data indicates a 658% price surge since the 2020 halving. Should trends follow suit, Bitcoin could potentially reach $434,280 by the 2028 halving.
Rekt Capital, a noted crypto trader, optimistically suggests to his 443,000 followers that the market is in the early stages of a bull phase, hinting at substantial room for upward movement in the short term.
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