$100 Million in Losses as Bitcoin Hits Eight-Month High
Bitcoin short-sellers have experienced significant losses in the past two days, with data presented by crypto derivative analytics website coinglass.com showing liquidations in short Bitcoin future positions worth around $100 million across major exchanges over the past two sessions. Meanwhile, Bitcoin has gained 8.5%, reaching an eight-month high and briefly spiking past $25,000. Bitcoin is currently trading just under 13% above earlier monthly lows in the low $21,000s. The recent rally was fueled by news that two of the largest Mt Gox creditors will receive most of their payout in BTC, rather than fiat.
Despite a pullback of around 5% from earlier session highs, Bitcoin is still up around 45% this year, with bulls remaining in the driving seat. Some analysts attribute Bitcoin's strong performance to the fact that it was oversold last year in the wake of the collapse of FTX, while others point to technical and on-chain metrics that suggest the worst of the 2022 bear market is now behind us. However, price risks may remain tilted towards the upside in the short term, and traders will be monitoring macro indicators such as US flash Services PMI data, GDP figures, and Core PCE inflation data, as well as the minutes of the Fed's latest meeting next week.
In the wake of the recent rally and a stop-run on overly aggressive bullish speculators, profit-taking may send Bitcoin back below $24,000. While the recent resurgence from earlier weekly lows is encouraging, traders should be aware of incoming macro risks. Bitcoin and the broader crypto market have been remarkably resilient to such headwinds so far, but options markets are currently indicating roughly equal premium on their respective put and call options, suggesting some degree of caution may be warranted.
