-->The bitcoin price fell by thousands of dollars yesterday due to the overheated American inflation data. Not long after, the price shot up again to the current level of $72,200, as if nothing had happened at all. However, that is not entirely true, as $360 million worth of long and short positions were liquidated during that roller coaster ride.

Speculating on bitcoin with borrowed money

Due to the extreme rises of bitcoin, more and more people are being tempted to speculate with borrowed money. This is reflected in a huge increase in long and short positions on the bitcoin price.

Heavy price fluctuations can then cause many traders to be pushed out of their positions. Yesterday it happened. After the price fell by several thousand dollars, $258 million worth of long positions were liquidated.

Only to liquidate another $103 million in shorts during Bitcoin’s rise that followed a few hours after its fall.

With this we have seen the largest “washout” of long and short positions since March 5. At the time, the bitcoin price fell to $60,800, after touching the old all-time high of approximately $69,000.

No extreme volatility for bitcoin

This time the volatility of the bitcoin price was not as extreme as it could be. The price fell about 4.85 percent from its high of $72,733 to $69,365, CoinGecko data showed.

Since then, Bitcoin has risen again to its current price of $72,200 and it seems as if nothing has happened at all.

“Traders are becoming more nervous about a correction as the bitcoin price failed to rise further during US trading hours. That is of course when the ETFs start trading.

At the same time, there is massive FOMO, which means the rally could continue,” a 10x Research representative told Cointelegraph.

It would be nice if we received confirmation today that the correction was a one-off and short-lived. In any case, the bulls will hope that they can dominate the bears again on Wednesday.

Source: https://bitcoinmagazine.nl/nieuws/bitcoin-koersachtbaan-veroorzaakt-360-miljoen-aan-liquidaties

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