Bitcoin Price Forecast: Bulls Mount $1.13 Billion Support to Prevent $65k Retest

Bitcoin price fell 4% from $71,933 to $69,200 on June 7, on disappointing Non-Farm Payrolls (NFP) report which saw BTC shed over $55 billion of its market capitalization within 24 hours. 

Why is Bitcoin Price Down today? BTC Dips 4% on Hawkish US NFP data

Bitcoin price came within whiskers of reaching a new all-time high on June 6, after Ethereum ETF approval in late May had set the crypto market up for a blistering start to June 2024.

But news of rates cuts in the EU by the European Central Bank (ECB)  and  Canada saw investors switch focus to US macro indices. With rising hopes of that the US Fed will follow suit, investors began to take long position on BTC.

However, Bitcoin price action quick took a negative turn on June 7 after the US Bureau of Labor Statistic release the Non-Farm jobs data for May 2024.

Non Farm Payrolls in the United States increased by 272 thousand in May of 2024. Non Farm Payrolls in the United States is expected to be 160.00 Thousand by the end of this quarter, according to Trading Economics global macro models and analysts expectations.

With inflation still at 3.4%, the latest NFP data showed that the US economy is still in overheated territories. The US Fed is now less likely to cut rates during the next FOMC meeting slated for June 12.

In effect, the global crypto market abruptly entered a consolidation phase on June 7, with Bitcoin price retracing 4% as investors reacted negatively to the hawkish development.

 Bitcoin Bulls Booked

Following the NFP report, Bitcoin investors who had shifted over $6 billion worth of BTC into long-term storage, began to make frantic sell-offs in the spot markets.

However, crucial data observed in the derivatives markets shows how massive liquidations of BTC LONG positions had an aggravating impact on the Bitcoin’s 4% price crash on June 7.

Coinglass’ Liquidations Chart below tracks the value of futures active contracts liquidated or closed during a given period. Higher long-liquidation occurs when there’s a rapid price downsizing in the spot markets and vice versa.

As seen in the chart above, BTC derivatives traders suffered at total $74 million liquidations on June 7. LONG traders suffered the worst hit, with over $56.4 million LONG positions closed, against the $18.2 SHORTs contracts liquidated

This shows how the 4% BTC price downside observed on June 7, may have been triggered by the LONG squeeze in the derivatives markets.

However, as the market FUD cools off, BTC bulls are making early efforts to halt the price dip by entering new positions.

BTC Price Forecast: Bulls Mount $1 Billion  Support to prevent $66k Breakdown

Bitcoin price has rebounded above the $69,000 level at the time of writing on Saturday June 8, as bulls look to stage an early recovery from Friday’s losses.

While the bearish sentiment is still dominant, BTC bull traders have now mounted new long-positions worth $1.13 million to keep prices above the $66,000 mark.

As seen above bulls have listed $1.13 billion million cumulative LONG positions around the current prices. But with over $2.6 million worth of SHORT positions in play, bears are evidently in control of the short-term market momentum.

Considering that majority of these positions could be liquidated if  prices fall below the $66,000 level, BTC bulls now have strong incentives to make covering purchases.

If that $1.13 billion support holds firmly, BTC traders can anticipate a safe consolidation within the narrow $66,000  to $70,000 channel over the weekend.