Bitcoin (BTC) experienced sudden and dramatic price fluctuations on April 19 due to geopolitical tensions in the Middle East impacting financial markets. The price of BTC dropped to a seven-week low of $59,630 after the daily close on April 18. These price lows were a result of increased tensions between Iran and Israel, which caused a significant drawdown from the previous high of $70,000. The situation escalated quickly, undoing the modest recovery that was underway the day before.
However, there were rumors that the situation might not escalate further, leading to a rebound in BTC/USD prices. The rebound was driven by spot demand, and within an hour, BTC reached local highs of $65,190. This volatility in BTC prices resulted in both long and short positions being affected. Traders noted that short positions were blown out, while interest from longs increased.
Sell-side liquidity between $64,000 and $65,000 disappeared instantly, with a new wall of bids appearing at $61,200. This indicated that there was significant support for the upward price movement. In the past 24 hours, total cross-crypto short liquidations amounted to $138 million.
While the focus was on short-term price movements, the upcoming block subsidy halving of Bitcoin received little attention. Trading firm QCP Capital noted that the market had formed a baseline support level around the recent lows, signaling the potential for a rally after the halving. Traders were anticipating the weekly candle close to determine the market sentiment.
Overall, despite the volatility and geopolitical tensions, there was optimism among traders that BTC prices would recover. However, readers should conduct their own research and exercise caution when making investment decisions.