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Major liquidations have occurred on the cryptocurrency market as a result of Bitcoin's recent plunge below the crucial $100,000 threshold. Both long and short positions were impacted by the astounding $873.53 million in liquidations that occurred over the course of the last day.

A whopping $489.41 million in liquidations were caused by Bitcoin alone demonstrating the volatility of its price movement. The charts demonstrate how Bitcoin tried to maintain its six-figure mark but encountered strong opposition, which caused a dramatic price reversal. Leveraged traders lost everything they had when the price retraced. Interestingly, this wave of liquidation was not limited to Bitcoin. 

While assets like XRP, Dogecoin and Solana saw large losses of $39.64 million, $22.40 million and $21.26 million, respectively, Ethereum saw liquidations totaling $85.71 million. According to exchange data, Binance and OKX were two of the most impacted platforms; in the last four hours alone Binance generated $8.13 million in liquidations, while OKX generated $5.04 million. 

With long positions accounting for 57% of the total, these liquidations were most severe, indicating overly optimistic wagers that Bitcoin would continue to rise. The market's precarious position is highlighted by the liquidation heatmap. Because institutional and retail traders are highly leveraged, even small price changes can set off a series of liquidations increasing market volatility.

The current chart of Bitcoin shows a struggle for stability, with important support levels at $92,000 being tested. The dangers of excessive leverage in a volatile market are highlighted by this liquidation event. Bitcoin will need fresh buying pressure and market confidence to break back above $100,000. For the time being, traders should exercise caution while the market adjusts to this most recent shakeout. The response of the larger cryptocurrency market in the days ahead will establish whether this decline was a normal correction or an indication of further volatility.

Arman Shirinyan is a trader, crypto enthusiast and SMM expert with more than four years of experience.

Arman strongly believes that cryptocurrencies and the blockchain will be of constant use in the future. Currently, he focuses on news, articles with deep analysis of crypto projects and technical analysis of cryptocurrency trading pairs.