A 4.8 percent impulse in Bitcoin’s price beginning Aug. 25 caused an unusual number of liquidations on BitMEX, wrecking $52 million in BTC short positions.

Notorious for its degenerate 100x leverage, BitMEX has been one of the most widely-used margin trading platforms in the world. These high-risk trades have the potential to sway the market, which is exactly what happened on Aug. 25.

Yesterday, the platform saw a large liquidation that stood out from the relatively uneventful trading day. Charts taken in the late afternoon on Aug. 25 showed that short Bitcoin positions were obliterated when BTC’s price saw a 4.8 percent surge, which was likely heightened by liquidated positions.

Over $52 million in short positions were liquidated on BitMEX after Bitcoin’s price rose 4.82 percent, or $484. The unusually high number of liquidated short positions could be correlated to the more bearish short-term outlook on the market, with the Crypto Fear and Greed Index reaching a historic low and many respected traders predicting a return to sub-$9,000 levels before BTC’s next leg up.

The resulting short squeeze pushed the price of other correlated altcoins as well—Ethereum, XRP, Bitcoin Cash, Binance Coin, and Litecoin all saw corresponding upward price movement.

The large liquidation of short positions on BitMEX left many traders worried about their positions. Although, volatility to the reverse caused many long positions to get liquidated as well; BTC’s volatility works both ways.

The short-seller liquidation on BitMEX caught many traders by surprise. Bitcoin was expected to continue its consolidation past the $10,000 resistance and retrace to $9,000, or lower. Many investors were looking forward to lower prices as it pushed Bitcoin into a perfect “buy zone.”

But Bitcoin mostly managed to stay above the $10,000 mark. If the world’s largest cryptocurrency manages to break resistance that is currently forming around $10,500, then the market could see a significant move upward, reaching as high as $11,000.

While these are exceedingly bullish predictions, Bitcoin has been breaking various records in the past few months. Most recently, Bitcoin’s realized market capitalization hit an all-time high, further supporting the notion of a long-term bullish trend.

Data from Coinmetrics.io showed that Bitcoin’s realized market cap surpassed the $100 billion mark, breaking the previous $91 billion high recorded on March 2018. When measured against supply, realized market cap measures the average price investors paid for each coin.

Based on the latest figures, the average investor paid a record $5,600 per BTC.

It is too early to tell whether the liquidation on BitMEX will have any long-term effects on the market, which still seems to be gearing up for its next big move.

The post Bitcoin impulse liquidates $52 million in shorts on BitMEX appeared first on CryptoSlate.

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