Ethereum

Long

Bitcoin

when

<div class="finbold">
 <p class="paragraph">In a rallying cryptocurrency landscape, each pump and opened long position leave liquidity pools behind, which can cause long <a rel="noopener noreferrer nofollow" title="squeeze" href="https://thebittimes.com/tag/squeeze.html">squeeze</a>s. Therefore, traders can look for cryptocurrencies with an increased volume of longs to prepare for <a rel="noopener noreferrer nofollow" title="retrace" href="https://thebittimes.com/tag/retrace.html">retrace</a>ments.</p>
 <p class="paragraph">Finbold gathered data from <em>CoinGlass</em> on March 2 to analyze the derivatives market. Cryptocurrencies have shifted to a dominating bullish sentiment amid a notable rally. In particular, Bitcoin (BTC) and Ethereum (ETH) accumulated massive gains and now threaten a correction.</p>
 <p class="paragraph">Essentially, traders tend to open longs when the market is going up while favoring short positions when it goes down. However, longs are trading contracts that require deposited collateral, setting a liquidation price downwards.</p>
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 <p class="paragraph">If this liquidation price is reached, the contract closes and liquidates the trader’s position, selling the collateral. This might drive prices further down, liquidating more trading contracts in a cascade effect called a long <a rel="noopener noreferrer nofollow" title="squeeze" href="https://thebittimes.com/tag/squeeze.html">squeeze</a>.</p>
 <p class="paragraph">Thus, market makers can use high liquidity pools as targets to increase volatility and their profits.</p>
 <h2 class="wp-block-heading" id="h-long-squeeze-alert-for-bitcoin-btc-at-50-000">Long squeeze alert for Bitcoin (BTC) at $50,000</h2>
 <p class="paragraph">Interestingly, Bitcoin accumulated relevant long liquidations in the $50,000 zone, which plays an important psychological support and resistance.</p>
 <p class="paragraph">The monthly chart shows eight liquidity pools with over $1 billion each, from $50,700 to $49,700. At least half of them have over $2 billion worth of long liquidations, up to over $12 billion in total.</p>
 <p class="paragraph">Nevertheless, there are smaller liquidity pools to the upside, with a candle wick at $64,300. Professional traders could use this wick for one more impulse seeking to attract more liquidity to the $50,000 zone before moving to a long squeeze.</p>
 <figure class="wp-block-image size-large"><img decoding="async" width="1024" height="554" src="https://cdn.thebittimes.com/images/2024/03/02/df453fcdc54335348fbf8306792b9768.webp" alt class="wp-image-158271" srcset="https://cdn.thebittimes.com/images/2024/03/02/df453fcdc54335348fbf8306792b9768.webp 1024w, https://cdn.thebittimes.com/images/2024/03/02/df453fcdc54335348fbf8306792b9768.webp 300w, https://cdn.thebittimes.com/images/2024/03/02/df453fcdc54335348fbf8306792b9768.webp 768w, https://cdn.thebittimes.com/images/2024/03/02/df453fcdc54335348fbf8306792b9768.webp 1536w, https://cdn.thebittimes.com/images/2024/03/02/df453fcdc54335348fbf8306792b9768.webp 2036w" sizes="(max-width: 1024px) 100vw, 1024px">
  <figcaption class="wp-element-caption">
   BTC 1-month liquidation heatmap. Source: <em>CoinGlass</em>
  </figcaption>
 </figure>
 <h2 class="wp-block-heading" id="ethereum-could-soon-retrace-to-2400">Ethereum could soon retrace to $2,400</h2>
 <p class="paragraph">On the other hand, Ethereum has even larger liquidity pools to the downside from February’s historical perspective. These pools point to a possible long <a rel="noopener noreferrer nofollow" title="squeeze" href="https://thebittimes.com/tag/squeeze.html">squeeze</a> down to $2,400, meanwhile liquidating many traders at previous <a rel="noopener noreferrer nofollow" title="levels" href="https://thebittimes.com/tag/levels.html">levels</a>.</p>
 <p class="paragraph">Like Bitcoin, ETH could first visit the local top at around $3,500 to accumulate more long liquidations before the bigger move.</p>
 <figure class="wp-block-image size-large"><img decoding="async" width="1024" height="554" src="https://cdn.thebittimes.com/images/2024/03/02/fc4c342d2430418b505645181eec8648.webp" alt class="wp-image-158272" srcset="https://cdn.thebittimes.com/images/2024/03/02/fc4c342d2430418b505645181eec8648.webp 1024w, https://cdn.thebittimes.com/images/2024/03/02/fc4c342d2430418b505645181eec8648.webp 300w, https://cdn.thebittimes.com/images/2024/03/02/fc4c342d2430418b505645181eec8648.webp 768w, https://cdn.thebittimes.com/images/2024/03/02/fc4c342d2430418b505645181eec8648.webp 1536w, https://cdn.thebittimes.com/images/2024/03/02/fc4c342d2430418b505645181eec8648.webp 2036w" sizes="(max-width: 1024px) 100vw, 1024px">
  <figcaption class="wp-element-caption">
   ETH 1-month liquidation heatmap. Source: <em>CoinGlass</em>
  </figcaption>
 </figure>
 <h2 class="wp-block-heading" id="conclusion">Conclusion</h2>
 <p class="paragraph">In summary, Bitcoin and Ethereum could soon retrace to lower levels in a correction movement following the recent rally. A long squeeze could cause 18% and 29% losses from their current prices at $61,000 and $3,400, respectively.</p>
 <p class="paragraph">Notably, these are historically common retracements in the highly volatile cryptocurrency market during bull runs.</p>
 <p class="paragraph">Still, the two cryptocurrencies could see a brief pump to their local top before moving down, or the derivatives market could shift entirely in the following weeks – eliminating this reported long squeeze treat.</p>
 <p class="paragraph"><strong><em>Disclaimer:</em></strong><em> The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.</em></p>
</div>
<p>Source: <a rel="noopener noreferrer nofollow" target="_blank" href="https://thebittimes.com/long-squeeze-alert-btc-and-eth-could-retrace-to-these-levels-tbt81383.html">https://thebittimes.com/long-squeeze-alert-btc-and-eth-could-retrace-to-these-levels-tbt81383.html</a></p>

Long squeeze alert: BTC and ETH could retrace to these levels

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