Key Takeaways
- Currently, $4b US in shorts could be liquidated if Bitcoin moves to US$100k
- Coinbase CEO backs memecoins and calls for purge of bad actors
- US monetary policy makers consider a stance shift in most recent meeting
Sentiment in crypto markets have taken a hit in recent weeks, with the fear and greed index currently indicating market sentiment as fearful.
Global exchange data from Coinglass suggests that if Bitcoin surges to US$100,000, up to $4 billion in short leveraged positions could be liquidated, triggering a potential short squeeze as traders rush to cover their positions.
Bitcoin volatility has also dropped to its lowest point since August 2024.
Brian backs memecoins
In a recent public post Brian Armstrong, Co-founder and CEO of Coinbase, has written at length his support for memecoins and free market capitalism. He mentioned that the way forward is to purge the bad actors in the space and continue to support those looking to build lasting value in the industry.
“..we should be open minded about where memecoins are going, even if some are silly, offensive, or even fraudulent today.
Memecoins are a canary in the coal mine that everything will be tokenized and brought onchain (every post, image, video, song, asset class, user identity, vote, artwork, stablecoin, contract etc).”
US monetary policy update
The minutes from the US Federal Open Market Committee’s (FOMC) most recent meeting were released this morning. These documents can provide insights into recent, and future monetary policy direction, which often has an effect on the crypto market, one way or another.
A notable mention from the minutes was the consideration by the committee to cease one of its restrictive policies. Various participants noted it may be appropriate to consider pausing or slowing balance sheet runoff until the resolution of the US debt ceiling.
Overall, this is a positive step in the direction of monetary policy easing in the US. This could as a result in a positive tailwind for crypto markets, however, policy is always an evolving environment.
Bitcoin Analysis
Bitcoin is currently trading green for the week, where it currently sits at US$96,700.
The Bollinger bands are continuing to compress, indicating that the price range of which Bitcoin is trading is narrowing.
Should we get a kick in volatility in the coming days, below are some potential outcomes.
Bullish Scenario
Price may head towards $102k which is the February monthly open; this could be fuelled by a short squeeze – based on what we know from the exchange data referenced earlier.
Bearish Scenario
Price failing to remain above the yearly open of circa $93k could result in a move back towards the January low of $89k.
💱 Swyftx Flows
The buy-to-sell ratio for unique Swyftx orders is nominally >$20,000 AUD (rolling data over the last 7 days, captured at 09:00 am AEST).
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