On Sunday, Bitcoin (BTC) fell below the $69,000 mark, leading to significant market liquidations. Interestingly, analysts have observed a connection between this downturn and a drop in the winning odds for US Republican presidential candidate Donald Trump as the general elections approach on November 5.
Bitcoin Price Drop Triggers $232.6 Million In Liquidations
Recently, Bitcoin has experienced notable price corrections following a bullish rally in October, during which it surged by 20%. The cryptocurrency’s value first declined from over $73,000 on Friday, finding some support around the $69,000 threshold.
After a brief phase of price stability, BTC faced another significant downturn on Sunday, hitting a temporary low of $67,960. During this decline, crypto analyst Ali Martinez reported that 104,787 trading positions were liquidated, leading to a total loss of $232.6 million.
Martinez’s data indicated that long traders made up most of the liquidations, totaling $198.6 million, while short positions saw only $34 million closed. This trend suggests that many traders expected a bounce back from the market leader after its initial price correction on Friday.
Currently, Bitcoin has rebounded to just above $68,000, with unclear prospects for its next price movement. Should the ongoing downtrend continue, the leading cryptocurrency could drop to approximately $55,000, echoing a range-bound pattern observed over the past eight months.
On the other hand, Bitcoin might experience a recovery, possibly reaching back to its all-time high of $73,750, given the persistent bullish sentiment fueled by increasing ETF inflows, an impending US election, and an expected 25 basis point rate cut from the Fed.
Could A Trump Loss Pose A Risk To Bitcoin?
Thus far, Bitcoin’s decline on Sunday has shown a correlation with a drop in the winning probability for US presidential hopeful and crypto supporter Donald Trump. As per data from Polymarket, Trump’s odds of winning the presidential election on November 5 fell by 4.3% after his Democratic opponent, Vice President Kamala Harris, gained favor in Pennsylvania.
While the pro-crypto Trump is still leading with a 53.8% chance compared to Harris’s 46.1%, recent market movements suggest that a potential loss for the Republican candidate could trigger a notable drop in Bitcoin’s price. However, historical price trends illustrate that such declines are often short-lived, as Bitcoin has typically entered a bullish phase following US elections, irrespective of the outcomes.
As of now, BTC is trading at $68,471, marking a 1.38% decline over the last 24 hours. Meanwhile, the cryptocurrency’s daily trading volume has decreased by 40.54%, amounting to $24.40 billion.
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