Bitcoin, while continuing to experience price movements similar to those seen after the Wall Street opening on November 16, is still undergoing a classic pullback. According to data from TradingView, the price of Bitcoin dropped to $36,470 with a decrease of over $1,000 during the day. This development closely follows the events from the beginning of the week, where bulls were unable to sustain new highs and resulted in long liquidations.
Why is the Bitcoin Price Falling?
According to data from CoinGlass, approximately $21 million worth of BTC long positions have been liquidated at the time of writing. This figure had reached $120 million on November 14. Market analysts commenting on the current situation have highlighted the recurring nature of Bitcoin price movements, suggesting the possibility of both new highs and a deeper pullback. Analysts from the on-chain data monitoring platform Material Indicators stated the following in a recent post:
“While maintaining the view that the market needs a correction, we cannot ignore the possibility of another attempt in the range of $38,000 to $40,000.”
The first Bitcoin spot price exchange-traded fund (ETF) news in the United States would have been a possible factor for such a move, but it was noted that time has run out due to regulatory constraints. The order book liquidity for the BTC/USDT pair shows that liquidity is building up on the sell side at $38,000, with only $33,000 of complementary bid volume available.
Inflation Surprise for the US Dollar
The macro outlook remained muted throughout the day, as the weakness in the US dollar resurfaced and recent recovery following the sharp drop on November 14 proved invalid. This development came into play as a complementary surprise for risk assets due to the more positive-than-expected US inflation data. The US dollar index (DXY) approached its lowest level since early September, nearing 104. Popular investor Bluntz commented on the matter:
“DXY got slaughtered today, I can say I’m surprised, but really not, it’s going much lower. Don’t underestimate how good this is for crypto.”
