Over the past three months, Crypto Market has witnessed a fierce “liquidity sweep.” This involves a continuous wipe-out of long and short positions using low to medium leverage.
This reflects the reality that today’s market lacks a clear dominant force, driven primarily by two-way fluidity hunts.
Bitcoin mass liquidation
According to Alphractal data, 94% of traders were liquidated during this period. Applying a 50% liquidity threshold filter leaves only dense liquidity zones. This indicates that the price actively “sought” large clusters to clear the position.
Ethereum has experienced a similar scenario, with both long and short positions having a major impact over the past 30 days.
In the case of Bitcoin, the most notable feature is the formation of large, long clusters, around $104,000-$107,000. This enriched liquidity zone coincides with the $100,000-$107,000 support zone identified by analyst Axel Adler Jr. based on on-chain data.
Specifically, this level marks the intersection of the realized price of short-term holders (average cost basis for short-term investors) and the 200-day SMA. This factor enhances the reliability of this “defensive” role in this support zone. Many experts predict that if this zone is compromised, there will be a deeper setback to the $92,000-93,000 range.
“The closest strong support zone is in the 100K-107K range, with STH that allows price and SMA 200D to cross. Below that, there is a deeper level of support that reflects the cost base of short-term investors who have around 92-93K support and have a coin holding for 3-6 months, Axel Adler Jr. said.
As reported by Beincrypto, Bitcoin’s spot taker activity has also become a selling point, highlighting the decline demand and risk of decline for support of $107,557.
Conversely, the $108,800 level is a short-term division between the bull and bear market. According to Murphy Chen, this represents the short-term cost base for investors.
Stable closures above this threshold indicate a significant drop in sales pressure. However, losing this level can lead to short-term sales.
In other words, the $108,800 zone is a “gateway” that determines whether Bitcoin will maintain its upward momentum or enter a deeper revision phase.
“Currently at $108,000, that’s 13% less than the highest. If STH-RP violates, there is theoretically 10-15% downside space. Without cooperation of a negative event of the same size, the correction amplitude may not exceed the previous two examples.
The market has settled 94% of its accounts for the past three months. This highlights the risks of highly leveraged trading in liquidity hunted markets.
Trading near large liquidity clusters is often risky as the 50% filter emphasizes. This makes defensive strategies, stop loss placement, and position management even more important.
With the first liquidation in Beincrypto, a support zone with post-bitcoin prices between $100,000 and $107,000.
