Bitcoin has rebounded slightly after a decline. The liquidation has gradually decreased after the price drop led to a surge in liquidation.
Bitcoin [BTC] experienced a significant drop in the previous trading day, leading to a surge in liquidation. As a result of this decline, traders who purchased Bitcoin in the past 30 days are now facing losses.
Surge in Bitcoin liquidation
Analysis of the Bitcoin liquidation chart on Coinglass by AMBCrypto shows a significant increase in liquidation volume on June 24th. The surge in Bitcoin price was mainly triggered by a significant drop in the price of Bitcoin.
It resulted in a large amount of liquidation, especially in long positions, with an amount exceeding $156 million.
In contrast, the liquidation amount of short positions is approximately $21 million, indicating that the traders betting on a price increase are most affected.
As of the writing of this article, despite a slight increase in the price of Bitcoin, short positions are experiencing more liquidation.
The short-term liquidation amount is approximately $13.5 million, while the long-term liquidation amount is lower, at about $5.2 million.
This shift indicates that traders who initially expected the price to continue to fall are now facing losses brought about by the rebound in price.
Slight increase in Bitcoin
Observation of the Bitcoin price trend by AMBCrypto shows a significant drop in the price of Bitcoin on June 24th, with the value of Bitcoin dropping to a low of $58,414 during the trading period.
As of the closing, the price had partially rebounded to around $60,263, but still declined by 4.60% from the opening price. This decline triggered a large amount of liquidation in the market.
As of the writing of this article, its price has risen to approximately $61,300, with an increase of about 1.70%. During the decline, Bitcoin’s relative strength index (RSI) dropped below 30, indicating a strong bearish trend.
Although the RSI has slightly recovered above this critical threshold, it suggests that despite minor improvements, BTC still primarily exhibits a strong bearish momentum.
BTC holders facing losses
According to Santiment, an analysis of the Bitcoin 30-day market value to realized value (MVRV) ratio reveals a concerning downward trend.
This ratio compares the market value of an asset to its realized value, and it dropped below zero around June 10th.
The decline indicates that the average market participant’s value of Bitcoin held is lower than its purchase price.
The recent price drop has exacerbated this situation, with the MVRV ratio plummeting to approximately -9.7% on June 24th.
As of the writing of this article, the MVRV ratio has slightly recovered to about -8.14%, but it is still negative.
The continued negative value indicates that traders who acquired Bitcoin in the past 30 days are still facing investment losses.
A negative MVRV ratio is typically seen as an indicator of undervaluation of the asset, as well as current holders purchasing at a price higher than what the market is willing to pay, thereby maintaining a bearish sentiment in the market.