$12 Million on BitMEX Liquidated as Bitcoin Prints Nasty “Darth Maul” Candle – newsBTC


After trading below $7.800 for days on end, Bitcoin attempted a run at the level just minutes ago. At first, it seemed like the cryptocurrency had a chance, rallying from $7,770 to $7,870 — a gain of approximately 1.2% — within the span of two minutes.

bitcoin price chart

Chart from TradingView.com

Unfortunately for bulls, as fast as the cryptocurrency rallied, it reversed. After hitting $7,870, the highest price BTC has traded at since the March 12th crash, “Black Thursday,” it tanked to $7,720.

Analysts know this sort of price action as a “Darth Maul” candle, whereas prices rapidly rally out of a consolidation pattern to only be smacked down by bears, often resulting in a red candle that looks much like the lightsaber of Star Wars’ Darth Maul.

While the move in the Bitcoin price was relatively small in that it only encompassed around $150, the effects on the derivatives market were strong.

Per data from Skew.com, approximately $12 million worth of Bitcoin positions open on BitMEX — both long and short positions — were entirely liquidated during this move. Most of the positions liquidated were short-side liquidations, potentially suggesting that this move was a byproduct of a large holder manipulating the market.

Bitcoin derivative liquidations

Chart from Skew.com

This Isn’t Bitcoin’s First Failure At $7,800

This is far from BTC’s first attempt at taking $7,800.

Ever since the cryptocurrency rallied 10% late last week from $7,000 to $7,700, it has been attempting to crack this level on at least four separate occasions. This Darth Maul candle, of course, is the latest attempt.

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The fact that Bitcoin is failing to surmount this crucial resistance, some say, is a sign that it’s time to flip bearish on the cryptocurrency.

For one, a cryptocurrency trader who called Bitcoin’s recent rally towards $8,000 nearly two weeks ago recently said that it’s become obvious that $7,800 has become a zone of resistance, marked by a “loss in momentum on order flow [data] from earlier today to Asia’s [Monday] AM session.”

The trader added that the recent price action has formed a “swing failure,” when an asset attempts to break past a historical resistance or support level but fails, leaving a strong wick on high volumes, then undergoes a trend reversal.

Another analyst echoed this, explaining how he sees many spot market sell walls from $7,800 to $8,000, which has him hesitant to long or buy Bitcoin:

Both stalling at their respective rally’s highs, not what I expected to be bearish. That said, what’s bothering me from going long is the spot sell walls up to 8k. $7800-8000 is a tough nut to crack.

Photo by Eric Han on Unsplash





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