Unexpectedly, there was a sudden surge in the Bitcoin market, culminating in about a 15% gain in the price. The surge that happened immediately after Elon Musk changed its Twitter Bio to “Bitcoin ₿” has caused a selling pressure on exchange platforms.
The surge took BTC to a high on the 10-day chart hitting $38,020, and has sparked a short liquidation worth $387 million on the major exchange platforms like Bitfinex, Binance, BitMEX, ByBit, HuobiDM, OKEx, Deribit, and FTX.
According to a Crypto Data provider, Coinalyze, the liquidations that happened, as a result, today’s surge is the largest one since January 2 when all the major exchanges closed shorts worth $575 million.
The forced closure of open short positions happens in a moment where there is a massive move of the price above an analyzed threshold, indicating the liquidation engine to close or “square-off” the open positions in the opposite direction. However, those moves often put a bullish pressure on the price, causing it to sustain an up-trend move for a while.
Traders have Anticipated a Bearish Move from Chart Analysis
The movement of the market earlier has fulfilled the requirement for a further bearish move, and many traders are anticipating the price fall concerning the inflows into exchanges that increased. But beyond the bearish setup, the market turns bullish after Elon Musk changed his Twitter Bio to “Bitcoin ₿” and tweeted, “in retrospect, it was inevitable.”
The SpaceX and Tesla CEO is a trader known for such sentiment to bullish move and a strong dislike for the bears. With this fact, it is safe to conclude that he indirectly planned the liquidations that happened with that massive rise in the BTC Market.
One of the largest mining pools, F2Pool, in a bid to document Musk’s approval of BTC, has imbedded the tweet by Tesla CEO in BTC block 668,197.
Vishal Shah, the founder of an offshore exchange Alpha5, believes that the bullish movement in the market will be sustained for a while and assumes the U.S. session will follow the digest of the news.
On the chart analysis, after piercing through the two-week bearish trendline, the next resistance is $40,112 on the daily chart, which is the January 14 high.