• Bitcoin dropped by 3.2% within 30 minutes of its recent surge above $69,000.
  • History shows that an all-time high price breakout is usually followed by a period of sustained upward movement.
  • In the last four hours, more than $84 Million in derivatives has been liquidated. The majority of these positions were long.

BTC Price Index and Live Chart – CoinDesk”>(BTC) rose to a record $69,325, topping its previous peak set in November 2021, on a flurry of volatility buoyed by demand from spot exchange-traded funds (ETFs) in the U.S. The largest cryptocurrency in terms of market value fell almost immediately as traders battled for control.

Bitcoin fell 3.2% in just 30 minutes, and was at $66,100 at the time of publication. The CoinDesk 20 Index (a measure of broader crypto markets) lost 1.8% an hour after BTC reached its high.

In the past, historically, bitcoin prices have risen for a few days after breaking an all-time record high. For example, in 2020, bitcoin rose from $20,000 to $24,200 within 48 hours. In June 2022, during a bearish market, it didn’t fall below $20,000 once again. In March 2017, Bitcoin hit a peak of $1350, before falling to $897 in the next two weeks. It then began a rise to a high of $20,000

The immediate reaction today indicates that bitcoin does not have the momentum to match the growth in 2020. Binance has seen significant sell orders at $70,000 and $71,000, which have contributed to the current stalemate.

In the last four hours, more than $84,000,000 worth of derivatives were liquidated. The majority of these positions were long. This explains the positive funding rates seen in the last few days. Positive funding rates indicate that perpetuals trade at a higher price than the spot rate, and require traders to pay a fee for those who hold short positions.

Bitcoin has been rejected from the $69,000 area, which means it will likely gravitate to an earlier level of support like $64,000 or $61,000 before making a second attempt to break the $69,000 barrier.

Bitcoin took more than three months to reach $20,000. After multiple rejections and a drop to $16,250 in the face of rising volatility, it finally broke through. Bitcoin is likely to enter a range bound period before attempting another breakout.

UPDATE (5 March, 16:15 UTC: Added CoinDesk 20 Index to the second paragraph.

Sheldon Reback is the editor.