Bitcoin Price News: $600M Liquidations in 4h – BTC to $100K?

Traders’ most feared adversary, President Donald Trump, showed up in the ring today and caused cascading liquidations across the crypto market. Bitcoin (BTC) is now down 4.2% in the past 7 days as a result of today’s drop.

A direct threat against China to impose higher tariffs over the two countries’ ongoing dispute on rare earth metals derailed what was initially a normal pullback.

Daily Crypto Liquidations (Last 6 Months) – Source: CoinGlass

Data from CoinGlass shows that $630 million worth of long positions were liquidated in the past 4 hours alone as a result of an unexpected 2.5% decline that pushed BTC below the key $120,000 psychological threshold.

Overall, $712 million in long positions have been flushed out in the past 24 hours. This figure includes a portion of yesterday’s $684 million wipeout too.

In total, $1.8 billion worth of crypto long positions have been liquidated in the past four days as the market entered red territory this week.

Bitcoin ETFs May Have Broken a 9-Day Streak of Positive Net Inflows

Despite the turmoil, Bitcoin-linked exchange-traded funds (ETFs) have kept booking positive net inflows for 9 days in a row – at least until today.

These vehicles have received nearly $6 billion in capital from investors during this period, resulting in an 11% jump in the total assets under management (AUM) held in these funds, according to data from Farside Investors.

This shows that investors are frantically buying every dip they can. However, today’s hostilities may turn the tables a bit in the short term, at a point when the rally was picking up steam once again.

The Federal Reserve is expected to cut rates for a second time this year during its late-October FOMC meeting. As much as 97% of analysts surveyed by FedWatch seem to think so, at least.

Nonetheless, Chairman Jerome Powell could opt to postpone that cut in light of these recent events.

Did BTC Just Pull a Fakeout?

Trading volumes in the past 24 hours jumped by 6% to $77 billion, while the daily chart shows that today’s activity has exceeded the 14-day moving average.

BTC/USD Daily Chart (Binance) – Source: TradingView

This could be the beginning of a classic fakeout for BTC as the token rose to a new all-time high at $126,000, only to retreat sharply right after.

As a result, we could see BTC dropping to its trend line support at $111,000 first, and even lower to around $108K if the selling spree increases.

The latest wave of liquidations could be an early indicator of what’s to come, especially if market conditions deteriorate. The baseline scenario at this point was bullish as Powell had every reason to cut rates again, and sentiment was picking up.

However, Trump’s increasing rhetoric against China could spook market participants and trigger a much stronger sell-off.

The Relative Strength Index (RSI) has already sent a sell signal upon crossing below the 14-day moving average. When this happens, it indicates that the trend’s direction has changed and that bearish momentum is gaining steam.

Even if Trump imposes stronger tariffs on China, the rally may not be over as macroeconomic conditions continue to be favorable for crypto amid a weak U.S. dollar, growing institutional adoption, a pro-crypto leadership at the White House and regulatory agencies, and more.

Hence, this dip could be an opportunity for late buyers to enter a long position if they expect that the top crypto will continue its upward path for the rest of the year.