Bitcoin Price Briefly Hits $91.2K Before Recovering Above $96K, Giving a Buy Signal?

Bitcoin experienced a decline, briefly hitting $91.2K before recovering above $96K. Overall, the crypto market saw significant turbulence, aligning with heavy losses across global stock markets.

Key Takeaways:

Bitcoin price declined sharply, hitting a low of $91.2K before recovering above $96K.

The crypto market experienced significant turbulence, coinciding with heavy losses in global stock markets.

Despite the downturn, Bitcoin price recovered quickly, potentially driven by institutional buying activity at lower prices.

The derivatives market saw major liquidations, with long traders facing the bulk of losses.

Bitcoin (BTC) price faced a round of selling pressure on Monday, dropping to $91.2K before recovering. The crypto market saw significant turbulence, aligning with heavy losses across global stock markets. However, BTC price quickly rebounded, trading above $95.9K at the time of reporting.

Bitcoin Price Falls to $91.2K, Triggering Derivative Market Liquidations

Notably, Bitcoin price experienced a sharp decline, hitting a low of $91.2K before rebounding to trade at $95,230. This price marked a 3.79% drop in the last 24 hours and a 3.34% decrease over the past seven days.

The downturn coincided with global stock markets experiencing heavy losses to start the week. According to various media reports, the widespread market slump was linked to ongoing trade tensions.

Amid this fluctuation, market intelligence platform Santiment noted that the negative sentiment surrounding Bitcoin reached its highest level in over a year. The number of bearish comments on social media significantly outweighed bullish commentary, reflecting growing trader skepticism.

However, historical data suggests that when market sentiment is predominantly bearish, Bitcoin has often presented strong buy opportunities. This occurrence was also one of only six instances in the past year where the negative sentiment surpassed positive commentary.

“Historically, markets virtually always move the opposite direction of the crowd’s expectations.”

At the time of Santiment’s report, Bitcoin had already recovered above $96K. The platform highlighted that large price swings often run counter to trader expectations, raising the possibility that the sharp drop led to retail traders exiting their positions at a local bottom.

Moreover, the market volatility resulted in a surge in trading volume, which climbed 146.93% to reach $162.75 billion. Meanwhile, open interest in derivatives contracts fell by 4.95% to $60.91 billion, indicating that some traders closed positions or were forced out due to liquidations.

Options trading activity also spiked, with options volume increasing by 139.76% to $4.62 billion. Additionally, open interest in options saw a modest rise of 3.49% to $28.79 billion, suggesting that some traders continued to hold contracts despite market uncertainty.

According to liquidation data from CoinGlass, long traders faced significant losses. Over the past 24 hours, total liquidations reached $457.77 million, with long positions accounting for $382.01 million and short positions contributing $75.76 million.

This imbalance suggests that aggressive sell-offs forced many leveraged long traders to exit the market, amplifying downward pressure on the Bitcoin price.