Bitcoin batters longs as liquidations copy May 2021 run to $30,000

Bitcoin (BTC) has been causing a lot of pain to the bulls in recent weeks, and now, recent data is showing just how much.

In a tweet on January 10, on-chain analytics company Glassnode I showed Those who are longing for BTC experienced a reboot last May, when BTC/USD started dropping towards $30,000.

Buyers fail to ‘grab the knife’

According to Glassnode’s Longs Liquidations Dominance, the “majority” of liquidations during the new year involved long runs.

This is not surprising, given Bitcoin’s overall trajectory since late November, but the scale of losses put the past few weeks on a par with May in terms of long versus short positions.

“Bitcoin’s long-term liquidation dominance has reached 69%, the highest since the deleveraging event in May 2021,” the researchers commented.

“This means that the majority of liquidations in the futures markets in recent weeks have been long traders trying to grab the knife.”

Illustrative chart of the dominance of futures monetization of bitcoin futures. Source: Glassnode / Twitter

Looking at the data, the period from late July to late November saw the formation of the opposite trend, with the shortest becoming victims of an unexpected bull several times.

Unusual bottoms

While long liquidation spurts do not always indicate a drop in local prices, the desire for a turnaround in the shorter time frames has long been fervent.

Related: “The Most Bullish Macro Backdrop in 75 Years” – 5 Things to Watch in Bitcoin This Week

As Cointelegraph mentioned, Bitcoin is strictly “oversold” by historical standards at current prices.

“If we bounce back here, I’m not convinced we won’t revisit these rates, but some short-term relief would be nice,” said quantitative analyst Benjamin Quinn. chirp Saturday as part of the daily observations.

“The daily RSI is also technically oversold, $40K-$42K is theoretically a support area as well.”

Quinn was commenting on Cryptographic Fear and Greed Indexwhich hit rare lows of just 10/100 over the weekend, indicating “extreme fear” among market participants.

Such events tend to be followed by a rebound in prices and sentiment, but the current declines are impressive, as the same price level one year ago was accompanied by the opposite phenomenon – 93/100 or “extreme greed”.