Bitcoin took a leap from $9700 to $10200 on Sunday recording a massive surge. It is understood that there are two primary reasons for the jump which is considered to be liquidation and traders taking profit from altcoins.
In the process of the surprising surge that the Bitcoin took, it also liquidated $74 million worth of long contracts on BitMEX alone. This in particular left many traders off guard.
Impact of the Bitcoin rise
As Bitcoin started to surge, the altcoins and DeFi, which were doing well in the recent past saw a slump. Ethereum, which had hit an all-time high in 2020, saw a slump with Aave and YFI also seeing major downfall.
The surge in Bitcoin also saw over-leveraged short contracts to become liquidated. A total of $74 million liquidation was formed when it reached the $10,200 mark.
“Are you ready?” Grayscale CEO Barry Silbert tweeted when Ether price broke out of the dreaded $280 resistance level on July 25.
“That is actually where my head is. Massive symmetrical triangle in $BTC points to ATHs, then $50k,” Trader Peter Brandt said.
Second, $10,000 has acted as a key psychological level for Bitcoin since October 2019. If BTC rejects at $10,200, it would still be lower than the previous peak in February 2020 at $10,473, according to a Cointelegraph report.
Although it would be far-fetched to call it a lower high formation, it might show that BTC price has not cleanly broken out of the multi-month range, the report added.