Categories: Cryptocurrencies

Bitcoin returns to $40K, liquidating over $50M of shorts in hours

Bitcoin (BTC) returned to $40,000 for the first time in two weeks during Feb. 4 as Wall Street volatility proved a boon for BTC bulls.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

Liquidations mount for BTC shorts

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD suddenly jumping past the $40,000 on Feb. 4, just two hours after the Wall Street open produced rapid gains.

At the time of writing, the pair was up $3,000 in two hours — an unexpectedly strong performance, which naturally caused short sellers significant pain.

According to on-chain monitoring resource Coinglass, BTC liquidations were $50 million over the most recent four-hour period, with cross-crypto liquidations passing $100 million.

BTC liquidations chart. Source: Coinglass

Analysts, who were keenly eyeing the area at $39,600 to be tested and held, were equally unsurprisingly optimistic.

“Well, I think people start feeling FOMO,” Cointelegraph contributor Michaël van de Poppe commented. 

The Wall Street session had opened with fresh gains for big mover Amazon, thus helping to fuel the crypto rally despite the company’s underlying data contrasting with its share performance.

Amid a confusing short-term environment, many took the opportunity to reiterate higher timeframe price targets.

https://twitter.com/Anbessa100/status/1489635295372926977?ref_src=twsrc%5Etfw

“I doubt there’s spot inventory left to sell at $40 thousand. What was going to be sold has been sold already in a tw-month downtrend capped off by a macro panic,” popular Twitter account Light continued about the sustainability of the moves.

“Also doubt buyers in the $30K area bought in order to sell here. Similar in many ways to the $6K level in 2019.”

BTC/USD reached $40,450 on Bitstamp before a consolidatory phase began, with volatility still very much in evidence.

Ethereum adds nearly 30% versus January lows

Altcoins followed suit, with Ether (ETH) up over 10% on the day to circle the $3,000 mark.

Related: Bitcoin price bounces after Amazon stock gains 15% in US tech comeback

ETH/USD last traded at its significant psychological level on Jan. 21, along with Bitcoin, and just over ten days ago was closer to $2,000.

ETH/USD 1-day candle chart (Bitstamp). Source: TradingView

Others in the top ten cryptocurrencies by market cap were green, with best performer Solana (SOL) approaching 13% daily gains.

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