Will Bitcoin take a dive today or in the next few weeks?

A zoom on its price chart reveals that it could form a bearish flag pattern. The likelihood of this outcome is reinforced by potential selling pressure of $3 billion in Bitcoin.

Previous bitcoin crashes have been highlighted by majorback swan“. These include the crash of Terra Luna and UST in May, as well as the debacle of 3AC in June.

Bitcoin had been under heavy selling pressure in the preceding months due to the SEC’s quantitative easing plans. The subsequent decline was exasperated by heavy liquidations of highly leveraged positions.

Is the next crisis coming soon?

If the rise in bitcoin since mid-June, the market is expected to see a further decline, strong selling pressure could trigger a major fall. It turns out that there is an upcoming event that could cause about $3 billion in selling pressure in the next few weeks or days.

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About 137,000 bitcoins recovered from Mt. Gox are expected to hit the market soon.

Given the long duration and strong growth that has taken place since the Mt. Gox hack, it is likely that recipients will want to sell.

Such selling pressure can also trigger a cascading panic effect. This would cause a major collapse. The actual timing of the release is not yet clear, but the custodian in charge of the 137,000 BTC recently received regulatory approval.

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A recent report from cryptoQuant revealed that a wallet linked to Mt. Gox just moved 300 BTC for the first time in nine years. This has sparked speculation that this is a sign that BTC MT GOX is about to be released. However, no activity has been observed on the Mt. Gox balance metric so far.

Notably, an increase in short position liquidations has been observed over the past two days. This suggests that there are a large number of short positions at the current level.

This is because another black swan event will be a lucrative event for short sellers.

Open interest in futures also rose despite a slight fluctuation between August 23 and 24. This may include futures bets against the rise.

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