Bitcoin Rebounds After Dip, Open Interest Slashed by $1.3 Billion

Bitcoin Bounces Back After Volatile Week: Key Levels to Watch

The Bitcoin price hovered around $69,000 on June 8th, as traders assessed the recent market volatility.

Data from Cointelegraph Markets Pro and TradingView showed Bitcoin stabilizing over the weekend. The leading cryptocurrency had experienced a sudden price drop on the previous Wall Street opening, triggered by what analysts called “confusing” US employment data. This decline was further amplified by a broader sell-off in altcoins, fueled by reactions to a livestream by the pseudonymous investor Roaring Kitty.

The price of Bitcoin (BTC/USD) dipped to local lows of $68,450 on Bitstamp, while the largest altcoin, Ether (ETH), briefly fell below $3,600.

Market Confusion and Opportunity

Trading firm QCP Capital described the previous 24 hours as “doubly strange.” In a Telegram update, they noted the uncertainty surrounding the US economic data releases – including next week’s Consumer Price Index (CPI) and the Federal Open Market Committee (FOMC) meeting – contributed to a risk-off sentiment.

The update further highlighted the impact of Roaring Kitty’s livestream, which attracted nearly a million viewers and coincided with a significant drop in the price of GME stock. This event, according to QCP Capital, likely triggered the collapse of altcoins and memecoins, wiping out over $40 billion in market capitalization.

Despite the volatility, QCP Capital saw the recent lows in Bitcoin and Ether as a potential buying opportunity, anticipating that future Federal Reserve actions could benefit risky assets like cryptocurrencies.

Key Levels for Bitcoin

Crypto market analysts are now focusing on key technical levels. The monthly open price around $67,500 is seen as crucial support, with the potential to prevent further price declines.

Popular trader Crypto Chase commented on the situation, stating, “Lots of coins are at critical levels in my opinion. These are the types of trades I prefer. If these levels fail to hold, the current bullish momentum on higher timeframes could be compromised. For Bitcoin, holding around $64,000 to $65,000 would be the last line of defense before a potential significant drop.”

A potential positive sign emerged from a significant decrease in leverage across Bitcoin and Ether positions. Trader Daan Crypto Trades noted, “Bitcoin lost approximately $1.3 billion in open interest during this price correction. Ethereum also shed around $800 million, bringing the total reduction in open interest for just these two major cryptocurrencies to over $2 billion.”

Previously, Cointelegraph reported on global liquidity trends suggesting a potential breakout for Bitcoin towards its all-time highs.