TLDR:
- Bitcoin fell below $67,000 on October 21, 2024, after failing to break $70,000
- Total crypto market cap dropped 1.5% to $2.3 trillion in 24 hours
- Over $200M in crypto positions were liquidated, with $171.2M in long positions
- The US Dollar Index reached its highest level since August at 103.67
- Market sentiment affected by upcoming Fed meeting and US company earnings
Bitcoin and other major cryptocurrencies experienced a dip, as the leading digital currency dropped below $67,000 after an unsuccessful attempt to breach the $70,000 mark during early Asian trading hours.
The largest cryptocurrency by market capitalization fell 2.3% over 24 hours, performing worse than the broader crypto market. The decline came as part of a larger market correction that saw the total cryptocurrency market capitalization decrease by 1.5% to $2.3 trillion.
Ethereum, the second-largest cryptocurrency, also faced downward pressure, declining nearly 1%. Other major cryptocurrencies saw even steeper drops, with Litecoin, Polkadot, and Internet Computer Protocol’s token experiencing losses between 4% and 5%.
Solana emerged as a notable exception to the market trend, gaining 2.4% to reach $163, though this remained below its weekend high of $170. In the mining sector, TeraWulf stood out with a 12% increase, supported by its recent expansion into artificial intelligence data centers.
The market downturn triggered substantial liquidations across cryptocurrency exchanges. Long positions, where traders bet on price increases, saw $171.2 million in liquidations over 24 hours. Short positions experienced more modest losses of $30 million during the same period.
Ethereum traders were particularly affected, with $58.8 million in liquidations, the majority coming from leveraged long positions. The total market-wide liquidations reached $201 million during this period.
Traditional financial markets played a significant role in the cryptocurrency selloff. The U.S. stock market showed weakness, with the Dow Jones Industrial Average dropping 344 points, or 0.8%. The S&P 500 declined 0.18% from its recent all-time high, while the Nasdaq Composite managed to gain 1.4%.
The U.S. Dollar Index reached its highest level since August at 103.67, adding pressure to cryptocurrency prices. Rising interest rates in Western economies also influenced market sentiment, with both U.S. 10-year Treasury yields and German 10-year Bund yields increasing by 10 basis points.
Market attention has turned to the upcoming Federal Reserve meeting scheduled for November 6-7. Current market data from CME Group’s FedWatch Tool indicates an 89.9% probability of a 0.25% rate cut, while the likelihood of a larger 0.50% cut has dropped to zero.
Bitcoin’s price movement continues to follow a pattern established since its record high of $73,700 over seven months ago. The latest attempt to break $70,000 mirrors a similar failed effort in late July, which was followed by a drop to under $52,000.
Technical analysis suggests the cryptocurrency market trades within a descending parallel channel that has been active since March 2024. The recent rally above $2.35 trillion in total market capitalization failed to break through the channel’s upper boundary at $2.36 trillion.
Crypto trading firm Wincent noted that upcoming quarterly earnings reports from U.S. public companies could further impact investor risk appetite. The firm suggested the possibility of a brief pullback followed by potential new all-time highs as the U.S. elections approach.
Despite the current downward pressure, funding rates for major cryptocurrencies, including Bitcoin and Ethereum, remain positive. This indicates that traders maintaining positions in the market continue to show bullish sentiment, willing to pay premiums to hold long positions.
The cryptocurrency market’s technical structure suggests the possibility of continued correction.
Support levels indicate the total market capitalization could find stability at $2.06 trillion, with a potential further decline to $1.89 trillion representing a 17% drop from current levels.
