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A “cascading long squeeze” of Bitcoin could explain the asset’s recent drop to 53-day lows as miners continue to sell, according to a Bitcoin analyst.
“Speculators kept adding to new long positions, just adding more fuel for more liquidations in a cascading long squeeze,” pseudonymous Bitcoin (<a href="https://cointelegraph.com/bitcoin-price">BTC</a>) analyst Willy Woo wrote in a June 24 X <a href="https://x.com/woonomic/status/1805358679601840501" target="_blank" rel="noopener nofollow">post</a>. 
A long squeeze happens when a large number of long-position investors (those betting on a rise in Bitcoin’s price) start selling their holdings as the price falls to cut their losses. This causes the price to drop even more, leading to a cascading effect on other long-position holders.&nbsp;
The opposite is <a href="https://cointelegraph.com/news/bitcoin-short-squeeze-liquidation-price-vertical-swan-bitcoin-swyftx">referred to as a short squeeze</a>. This term&nbsp;became well-known when retail traders <a href="https://cointelegraph.com/news/robinhood-close-settle-gamestop-meme-stock-lawsuit">pumped up the price</a> of GameStop stocks in January 2021,&nbsp;&nbsp;forcing large short investors to buy back the stock at a higher price to limit their losses and thus pushing the stock price up to meteoric heights.
<a href="https://www.coinglass.com/pro/dashboard/bitcoin" target="_blank" rel="noopener nofollow">According</a> to CoinGlass data, a&nbsp;dip below $60,000, similar to June 24 when Bitcoin fell below $59,000, would wipe $1.16 billion in long positions. However, a similar 3.73% upward swing would erase $2.18 billion in short positions, showing that traders are currently more confident in the price going downward.&nbsp;
“Worth a breakdown of what’s happening given the fear in the market,” Woo added. 
It comes as the Crypto Fear and Greed Index — which measures market sentiment for Bitcoin and the broader cryptocurrency market — <a href="https://cointelegraph.com/news/crypto-fear-greed-index-falls-18-month-low#:~:text=The%20Crypto%20Fear%20&amp;%20Greed%20Index,that%20metric%20is%20currently%20paused.">tanked to its lowest score in nearly 18 months</a>.
<h3 data-ct-non-breakable="true" id="post-halving-miners-capitulation-continues">Post-halving miners capitulation continues</h3>
Woo also pointed out the ongoing “post-halving miners capitulation” event, which is a theory that miners will turn off their hardware and sell their coins if Bitcoin falls below a certain price and <a href="https://cointelegraph.com/news/bitcoin-price-bouce-will-occur-when-weak-hands-capitulate-and-hashrate-recovers">mining becomes unprofitable</a>.
“Superimposed on this liquidation squeeze, we have a post-halving miners capitulation,” said Woo, explaining that miners selling Bitcoin could pay for needed upgrades while the weakest miners are closing shop and being liquidated.”
Related: <a href="https://cointelegraph.com/news/bitcoin-analysts-forecast-btc-price-drop-to-50k-before-parabolic-run-begins">Bitcoin analysts forecast BTC price drop to $50K before parabolic run begins</a>
On June 25, Bitcoin’s price is trading slightly above the crucial $60,000 level, at $61,320 at the time of publication, according to CoinMarketCap <a href="https://coinmarketcap.com/currencies/bitcoin/" target="_blank" rel="noopener nofollow">data</a>. 
<figure data-ct-non-breakable="true">
 <img src="https://s3.cointelegraph.com/uploads/2024-06/bf719c1a-760a-4b21-a836-f26a2adc7535.png" alt="" title="">
 <figcaption style="text-align: center;">
 Bitcoin is down 2.06% over the past 24 hours. Source: CoinMarketCap
 </figcaption>
</figure>
On June 24, Bitcoin saw its biggest daily decline in over three months, dropping 6.26% to $58,890, according to pseudonymous crypto commentator Bitcoin Archive.
“The biggest daily discount in price for 97 days,” they <a href="https://x.com/BTC_Archive/status/1805339857738404154" target="_blank" rel="noopener nofollow">wrote</a> on June 24.
Jan3 CEO Samson Mow <a href="https://x.com/Excellion/status/1805343066058113373" target="_blank" rel="noopener nofollow">believes</a> the “Bitcoin dip is purely sentiment and fear driven, not from selling off large holdings.”
Magazine: <a href="https://cointelegraph.com/magazine/spot-ethereum-etf-ether-price-bitcoin-patrick-scott-dynamo-defi-hall-of-flame/">Ethereum’s recent pullback could be a gift: Dynamo DeFi, X Hall of Flame</a>
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Bitcoin ‘cascading long squeeze’ to blame for slump to $60K

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Cointelegraph

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