Bitcoin (BTC) fell to its lowest level since mid-January on March 10, data from Cointelegraph Markets Pro and TradingView showed.
Silicon Valley Bank gets ‘Silvergate moment’
Down 2.4% on the day, BTC/USD saw the majority of losses during the previous day’s Wall Street trade as risk assets everywhere suffered a setback.
This comes from the market’s cold feet on the back of a major restructuring at Silicon Valley Bank (SVB) – the 16th largest commercial lender in the United States.
SVB’s parent company, SVB Financial, said it was selling its entire portfolio of securities at a huge loss as part of a plan to raise more than $2.2 billion in capital.
The result was a fall in the share price of SVB Financial, which shed 60% during the session in a move that is very familiar to crypto market participants who remember the recent death of Silvergate bank.
However, rather than the FTX debacle, SVB blamed the problem on the Federal Reserve and its quantitative tightening (QT) policy – the process of draining liquidity from the economy that has forced risk assets across the board.
“We are taking these actions because we expect higher interest rates, pressured public and private markets, and higher cash burn rates from our clients when investing in their businesses,” CEO and president Greg Becker said in a letter to investors.
The second bank of the week could collapse.
First, Silvergate is looking to liquidate.
Currently, Silicon Valley Bank is down 61%.
The economy is not looking good, but Powell wants to go ahead and speed up the hike.
– Michael van de Poppe (@CryptoMichNL) March 9, 2023
JAYPOW may have destroyed the US banking system.
2008 is the bank’s portfolio of bad credit – aka subprime.
2023 is the bank’s portfolio of long-term bonds like UST and MBS???
If it goes down then remember Mar ’20, big down, bailout, then big up! My body is ready. pic.twitter.com/8MztWYAAlQ
– Arthur Hayes (@CryptoHayes) March 10, 2023
With stocks reeling from the news, however, it was only a matter of time before crypto caught the contagion.
While the S&P 500 finished the session down 1.8%, on track for the worst week of 2023, Bitcoin continued to fall overnight and finally gave up $20,000 support.
In doing so, it fell to the lowest level since January 13, removing two months of gains.
BTC price has less support
Reactions to the crypto’s losses were mixed – as Cointelegraph reported, many had expected a retest of lower levels that had been untouched since the start of the year.
“Maybe it will be 18-19k before it’s over- but it’s just a retest,” popular trader Credible Crypto write in part of the Twitter response.
The chart presented to explain the reasons behind the downward movement scope, is said to be “logical and healthy, not unexpected or unexpected.”
After February produced only 0.03% overall gains for BTC/USD, March proved to be a month of comedowns in the day, emboldening conservative market participants to predict the next new local bottom.
Trading account Daan Crypto Trades said the pullback happened “sooner” than expected.
“If I just go to the charts and forget all the FUD, Macros and such, I myself will bid here,” he said. toward Twitter followers of the day.
“I think holding a knife is dangerous and it’s best to see a few first.”
The chart shows the area of interest based on the Fibonacci retracement level of the local high above $25,000.
Also following the unwinding of Fibonacci levels is the Stockmoney Lizards trading resource, which has its eyes on the 4-hour overnight chart.
drop to 50.0 Fib, 4h RSI oversold. The current bearish momentum is only accelerated. pic.twitter.com/Ddotb6PCkr
— Stockmoney Lizard (@StockmoneyL) March 9, 2023
At the time of writing, BTC/USD is hovering around $19,800, still threatening to continue its descent into Wall Street’s opening day.
The liquidation in the post-FTX record is a chaotic “front run” of crypto
In a further episode of deja vu for crypto, a recent bearish streak sent a surge of liquidation in the leveraged market.
related: Bitcoin continues to liquidate as BTC price action provides $22K support
According to the latest data from the monitoring source Coinglass, those who were long BTC lost more money on March 9 than at any time since the FTX implosion.
BTC long liquidation totaled $94.1 million, while the total crypto tally for the day was $248.8 million.
As for Skew’s trading sources, worse threats remain, with the crypto market potentially dodging the bullet first.
“This looks like an exit & unwinding flow for me. (front running bad news),” Wrote in the comments section of Twitter on the day.
$BTC Coinbase Spot
This looks like an outflow & unwinding to me. (home runs bad news)I should definitely check this out before smh pic.twitter.com/gOAAqZHw1n
– Skew Δ (@52kskew) March 10, 2023
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