Bitcoin (BTC $25,715) circled $25,800 on June 6 as the aftermath of fresh panic over the largest exchange, Binance, lingered.
BTC/USD 1-day candle chart on Bitstamp. Source: TradingView
BTC price risks losing multimonth range
Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it steadied after dropping to near three-month lows.
The weakness came from a knee-jerk market reaction to the news that the United States Securities and Exchange Commission (SEC) was suing Binance and its CEO, Changpeng “CZ” Zhao, over “a variety of securities law violations.”
“Through thirteen charges, we allege that Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law,” SEC Chair Gary Gensler stated in part of a press release.
While sparks continued to fly between the exchange and the SEC — even on social media — Bitcoin traders looked to what a recovery might look like.
Popular trader Crypto Ed considered $26,200 as a bounce target before fresh downside kicked in thanks to a lack of spot buyer demand.
“I think we’re pretty close to a bounce, but could be a short-term bounce,” he summarized in a dedicated YouTube market update following the Binance news.
Crypto Ed added that his downside target lay at or just above the $24,000 mark.
Fellow trader Crypto Tony agreed, sharing a similar mid-term roadmap for BTC price.
“Shed some more profit on my short this morning, but now looking for a relief wave before the final leg down towards $24,500,” he told Twitter followers.
I anticipate this is the final leg down before we accumulate for pump to come July / August.
BTC/USD annotated chart. Source: Crypto Tony/ Twitter
On the day, trading suite DecenTrader warned about a high long/short ratio on Bitcoin, this even beating levels seen after the implosion of the FTX exchange in November 2022.
“We would typically like to see this start to decrease, if we are to keep bouncing,” it argued in part of Twitter commentary.
#Bitcoin's Long/Short ratio is now extremely high, higher than during the FTX collapse.— Decentrader (@decentrader) June 6, 2023
We would typically like to see this start to decrease, if we are to keep bouncing. https://t.co/TBohV62y6O pic.twitter.com/2kSxndd9QV
Risk assets already “on edge”
Others looked beyond the Binance story to call for the broader risk asset environment to improve in the coming months.
Among them was Arthur Hayes, former CEO of derivatives exchange BitMEX, who, in a reaction suggested that sub-par crypto performance was tied directly to activity within the US economy.
The Treasury General Account (TGA) was increasing, he noted, repeating an existing theory about the direction of crypto prices for the rest of 2023.
“The market is down on some binance FUD. But regardless of the catalyst, risk mrkts r on edge cause of the TGA refill,” he wrote in part of a tweet.
By end of summer the mrkt will move past that and onto the lg amt of money printing humming along in the background.
According to monitoring resource CoinGlass, crypto long traders saw liquidations, which totaled just shy of $300 million on June 5.
Crypto liquidations chart. Source: CoinGlass
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