Memecoins
Exploring What’s Next for Dogecoin, SHIB, and PEPE After Cryptocurrency Liquidations
- Bitcoin’s free fall below $60,000 has caused fear in the market
- The memecoin market has fallen out of favor recently, but one contender appears to be gaining investor interest
The last 36 hours have seen Bitcoin [BTC] The price fell 9% from $58,800 to $55,500 before rebounding 6% to $56,800 at press time. This volatility led to a large number of cryptocurrency liquidations as long positions suffered further.
The fall in the price of Bitcoin was caused by various factors. One of these factors was the news that the German government was selling BTC. Another was Mount Gox transfer $2.7 billion worth of BTC to a new address.
Given the magnitude of this volatility, cryptocurrency liquidations are likely to ease over the next few days as the market needs time to accumulate liquidity before moving towards it to withdraw it.
THE Memecoin The sector has not been spared from all this either. Although it was one of the best performers at the end of May, it has turned bearish in recent weeks.
The bloodbath has stalled for now
Source: Coin glass
According to Coin data, Between July 4 and 5, a combined total of $750.55 million in long positions and $198.66 million in short positions were liquidated. Liquidation here refers to the forced closing of a trader’s position in the futures market when the margin in their account is no longer sufficient to maintain their positions open.
In turn, when they are closed, they introduce market orders in the opposite direction of the open position before liquidation. Therefore, the effect of a rapid wave of long liquidations due to rapid price falls leads to a cascade of liquidations.
Large-scale cryptocurrency liquidations in this manner can be beneficial for the market. They can remove over-leveraged traders, paving the way for spot price movement and reducing the effect of speculation.
Grandpa [PEPE]the third-largest memecoin by market cap, could benefit from the recent wave of selling.
The state of the major memecoins is poor, with one exception
Source: Hydraulic block
AMBCrypto found that PEPE’s liquidation heatmap saw a large portion of the liquidation levels in the $0.000077-$0.0000095 region wiped out. This trend has been building since mid-May. To the north, the $0.000014 area could be the next magnetic zone for the altcoin’s price.
AMBCrypto analysis on Dogecoin [DOGE] And Shiba Inu [SHIB] revealed that both memecoins have a cluster of liquidation levels further south.
Therefore, a recovery for DOGE or SHIB might need more time and deeper correction. Even though Shiba Inu has shown a bull flag Over the longest time horizons, it is PEPE that could recover most quickly from its recent losses.
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Source: PEPE/USDT on TradingView
PEPE bulls must defend the $0.00000796-$0.0000089 territory to keep bullish hopes alive on the longer time frame. Recent cryptocurrency liquidations have caused panic in the market, but there is some hope that a price recovery could begin in July.