If Bitcoin returns to the price it had been hovering around for the previous two days before the slight dip, it would wipe out a considerable number of short positions.
Should Bitcoin quickly rebound from its recent dip to its June 6 price of $71,000, over a billion dollars worth of short positions will be liquidated.
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On June 7, Bitcoin BTC $69,377 dropped 3.33% to $68,507 before slightly recovering above its key level of $69,000 amid broader macroeconomic uncertainty triggered by the United States Employment Situation Summary Report, which revealed more job growth than expected during May.
Along with Bitcoin’s price decline, Ether ETH $3,689 also saw a 3.58% decline over the 24 hours, and several altcoins, such as Solana’s SOL
$162, Dogecoin DOGE$0.15 and Pepe PEPE $0.000013, took a hit of 5.61%, 8.70% and 9.99% respectively, according to CoinMarketCap data.
The market plunge led to a $409.51 million wipe out of short and long positions across the board, according to CoinGlass data. Of that, $56.71 million were long positions in Bitcoin.
However, two days before Bitcoin’s price decline, on June 5 and 6, it hovered between $70,000 and $71,662. Many traders were hopeful it might inch closer to its all-time high of $73,679.
Traders heavily lean towards shorting Bitcoin
Now, traders are hedging their bets that its price might not rebound as quickly.
So much so that if Bitcoin returns to $71,000, $1.38 billion in long positions will be wiped out, indicating that futures traders anticipate further price declines.
This comes after investors have been curious as to why Bitcoin’s price hasn’t surpassed its March all-time highs lately, especially given the 19-day streak of positive inflows into Bitcoin exchange-traded funds (ETFs).
On June 7, Cointelegraph reported that analysts indicated that many more factors impact Bitcoin’s price and that the ETFs don’t have enough clout.
“ETF flows are fantastic, but they are not strong enough to exceed the entire ecosystem selling (yet),” Capriole Investments founder Charles Edwards told Cointelegraph.
Meanwhile, crypto trader Christopher Inks reiterated that “the market is made up of spot, futures, ETFs, and options.”
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