Bitcoin Nears 6-Week High, Short Covering Drives Crypto Rebound
Bitcoin rose above US$74,000 on Monday (March 16th), hitting its highest level in approximately six weeks, driven by a wave of short position liquidations, despite market participants remaining cautious about geopolitical escalation in the Middle East. The largest cryptocurrency was last trading 3.4% higher at US$73,892.4 at 2:21 a.m. ET, after briefly touching US$74,336.9 earlier in the session.
This gain extended Bitcoin's gains, which had already reached around 6% over the past week, even as global stock markets weakened due to surging oil prices that fueled inflation concerns. In market terms, this rally is driven more by technical and positional factors, rather than major shifts in global risk fundamentals.
CoinGlass data shows that total crypto market liquidations in the past 24 hours reached approximately US$344 million, with 83% of these coming from short positions. Liquidation occurs when leveraged traders are forced to close positions due to price movements against them, ultimately magnifying price swings and accelerating short-term rallies.
However, market sentiment has not fully recovered. The Middle East conflict, which is entering its third week, continues to raise concerns about global energy supplies and inflation risks, especially with oil prices remaining above US$100 per barrel amid threats of disruptions around the Strait of Hormuz. This uncertainty has the potential to keep volatility in risky assets, including crypto, high.
Market participants are also awaiting the outcome of this week's Federal Reserve meeting, where the US central bank is widely expected to hold interest rates steady while assessing inflation risks. In the altcoin market, gains were quite widespread: Ethereum surged 8% to US$2,265.88, Solana and Polygon each rose 6%, Cardano surged nearly 10%, and Dogecoin rose 7%, while XRP fell 5% to US$1.48.
Source: Newsmaker.id
