Bitcoin price increases, causing $1.32 billion in short sales to face the risk of liquidation

Bitcoin (BTC) has consistently performed well over the past few days, as the price has increased by 10.77% in the last week. While this is good news for some traders, others risk losing money if BTC maintains its uptrend.

This analysis pinpoints the potential price levels that BTC could reach and the impact of the trend on open positions in the Derivative market.

Also Read: Bitcoin boosted investment Capital flows into Crypto to 17.8 billion USD from the YTD

The recent price rally threatens short-selling expectations

Over the past 24 hours, Bitcoin has fluctuated around $65,000, currently, the price is trading at $65,302. But before that, BTC reached $66,250 and then fell again. However, according to data from Coinglass, up to $1.32 billion worth of short positions are at risk of being liquidated if BTC reaches $68,066.

This is according to the liquidation heat map. For those unfamiliar with the term, liquidation occurs when an exchange closes a trader's position due to insufficient margin to keep the contract open.

While this is done to prevent further losses, this action can also be due to high volatility when the price moves in the opposite direction of the trader's prediction. Specifically, longs are those betting on price increases, while short sellers are traders in line with the downside.

Therefore, the image above shows how much Bitcoin will lose when Bitcoin reaches the above price. Furthermore, the heat map identifies areas where large-scale liquidations are likely to occur and areas with high liquidation concentrations.

If liquidation is concentrated in a particular region, cryptocurrency prices will likely move toward that region. According to data obtained from Coinglass, Bitcoin price could approach $67,469 and then $68,000. If BTC successfully takes over these areas, the next area of ​​interest will be $72,599, bringing it closer to its All-Time-High (ATH).

Big players stop selling off Bitcoin

In addition to the heat map, this week 's massive Capital into the Bitcoin ETF are another piece of data supporting the price increase. Significant Capital inflows into these products played a huge Vai in Bitcoin's rise to ATH in March. The scarcity of liquidation on this front was also important given the downturn experienced in Q2. Therefore, BTC could see a sustained growth if more money continues to flow into ETFs.

Regarding this development, analyst Timothy Peterson suggested that BTC could soon reach $71,000.

“Cumulative net ETF inflows hit a new ATH last week. This marks 6 consecutive days of positive Capital inflows totaling $1+ billion.”

He stated on X.

From an on-chain perspective, the Accumulation Trend Score shows that Bitcoin has exited the distribution phase. Trend scores range from 0 to 1, providing insight into the behavior of large entities in the market. If the cumulative trend score rating is close to zero, it means that, on Medium, market participants are selling.

This is evident from the trend between April and June. However, at the time of writing by BeInCrypto, the score was 0.55, indicating that the number of coins being purchased on chain is increasing.

BTC price prediction : Uptrend confirmed

According to the daily chart, Bitcoin has confirmed its uptrend after the price rose above the 20 (blue) and 50 (yellow) EMAs. EMA stands for Exponential Moving Average and shows trend direction over a period of time. If the EMA is above the price, the trend is down. However, it suggests that the price could trade higher. If maintained, the next price Bitcoin will reach could be around 68,235 USD, as shown below.

Additionally, the Cumulative Volume Delta (CVD) index is positive. CVD shows the net difference between buying and selling volume. When it is negative, it means that the BTC sold was higher than the amount purchased.

Therefore, the positive value implies that market participants have purchased additional volumes of Bitcoin since July 13. This is also reiterated by the moving Medium convergence divergence (MACD) indicator. MACD is a technical tool that shows the relationship between the 12 EMA (blue) and the 26 EMA (orange) to measure trend momentum and price acceleration. If the reading is negative, the trend is bearish and the price may fall.

However, the MACD rating at the time of writing is in the green zone, suggesting that Bitcoin price may continue its uptrend.

In short, if large entities or whales start redistributing coins, potential price increases could be nullified. If this happens, Bitcoin could drop to $60,899.

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