Bitcoin Loses $80K After Rejection Near $81,500

Bitcoin could not maintain the $80,000 threshold after rebounding to $81,455 on August 28. Then, its price fell to $76,877 before a slight rise. This rejection occurs while many sell orders remain visible between $80,800 and $83,000. Their presence can slow a recovery, however, it does not justify either the identity of their holders or their real intention to sell.

Multiple liquidity zones now frame bitcoin

On the evening of August 27, BTC reached $81,000, before surrendering all its gains. First, it dropped below $79,300, then the correction intensified after Kevin Warsh’s speech at Jackson Hole.

CryptoReviewing publishes an analysis noting a significant concentration of orders and liquidation levels around the prices. The configuration reveals four main zones :

• Large sell orders between $80,800 and $83,000 ;
• Buy orders concentrated between $78,000 and $79,000 ;
• Nearly $5.7 billion of estimated liquidity between $75,000 and $78,500 ;
• Around $2.8 billion between $81,500 and $84,000.

The lower zone thus constitutes more than twice the amount estimated above the price. This asymmetry highlights that a pullback would trigger more liquidations than a corresponding rebound. Nevertheless, it does not guarantee a correction toward $75,000.

The “walls” found in an order book are equivalent to displayed intentions. Their holders must move or cancel them before execution. Also, their volume does not allow certain identification of whales. The term thus describes a concentration of large orders, not already completed sales.

Kevin Warsh’s speech increases pressure

The drop had started before the Federal Reserve (Fed) chairman’s speech. It continued after his intervention, with a new low at $76,877. On August 28, bitcoin traded around $77,600, down nearly 2.8% over 24 hours, according to data from CoinGecko.

No immediate decision on rates was announced by Kevin Warsh. In his official speech, he mainly declined the systematic use of “forward guidance”, which aims to guide markets on the future trajectory of monetary policy.

The Fed’s top official wants the institution to retain more freedom and adapt its decisions to available data. He also recalled that inflation remains too high. The PCE index rose 3.7% year-over-year and 4.1% annualized over six months, against an official target of 2%.

These remarks did not provide markets with the prospect of quick monetary easing. They thus limited immediate demand for cryptos. Economic strength and massive investments in artificial intelligence also reduce the urgency of a rate cut.

It remains difficult to attribute the entire correction to this single speech. Bitcoin had already gained about 28% in August and faced resistance around $81,000. The settlement of a significant options expiry as well as profit-taking also contributed to the movement.

Liquidations confirm the return of leverage

This reversal triggered the forced closure of multiple positions. The data reports $107 million in liquidations on bitcoin. They are split between $57 million short positions and $50 million long positions.

Across the entire crypto market, nearly $300 million in positions were liquidated. CryptoReviewing reports $465 million over 24 hours. This discrepancy may result from the exchanges counted, the observed period, and data updates.

Open interest resumed its rise, revealing that traders quickly rebuild their leveraged positions. At the same time, Coinbase premium returned positive. Buyers in the United States then pay slightly more than those on other platforms.

This improvement was not enough to restore bullish momentum. Spot demand remains weaker than futures activity. Thus, the market depends mainly on leverage, increasing its exposure to liquidations.

Bitcoin must first sustainably regain the $80,000 threshold, despite extreme volatility, to neutralize the recent rejection. Conversely, a break in the $75,000 to $78,500 range would reinforce the risk of an intensified correction. These thresholds remain monitoring zones, not guaranteed targets.

Luc Jose A.

Diplômé de Sciences Po Toulouse et titulaire d’une certification consultant blockchain délivrée par Alyra, j’ai rejoint l’aventure Cointribune en 2019.
Convaincu du potentiel de la blockchain pour transformer de nombreux secteurs de l’économie, j’ai pris l’engagement de sensibiliser et d’informer le grand public sur cet écosystème en constante évolution. Mon objectif est de permettre à chacun de mieux comprendre la blockchain et de saisir les opportunités qu’elle offre. Je m’efforce chaque jour de fournir une analyse objective de l’actualité, de décrypter les tendances du marché, de relayer les dernières innovations technologiques et de mettre en perspective les enjeux économiques et sociétaux de cette révolution en marche.

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The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.