$1.7 Billion Liquidation occurred in the Cryptocurrency Market, Bitcoin Price Dropped

Total liquidations in the cryptocurrency market exceeded $1.7 billion. Bitcoin
The price set an intraday low at $94,150 on Monday. Profit sales extended until Tuesday. BTC still remains below the $97,000 threshold. Markets are poised for an eventful week with many major US economic events on the calendar.
Total Cryptocurrency Liquidations Exceed $1.7 Billion
According to data, 583,530 traders were deleted from the market in the last 24 hours. As a result of total liquidations, it exceeded $1.7 billion. At least $1.552 billion of these consisted of long positions and $154.59 million consisted of short positions.
These massive liquidations came after Bitcoin's recent correction.
While the liquidation event shocked traders and investors, the market is both optimistic and skeptical. It was the largest long liquidation since 2021. Such large liquidations almost always signal a bottom. This is not the time for panic selling. It's also not the time to deleverage too greedily or hastily. This is probably a good time to start scaling into high-conviction plays on the spot in preparation for the next aggressive move up.
Indeed, caution is warranted given the expected impact of US economic data due this week. The US Consumer Price Index (CPI), weekly unemployment data and Producer Price Index (PPI) may influence Bitcoin sentiment this week. These US macroeconomic data will reveal the state or health of the US economy.
According to some, the massive liquidations provided a “healthy cleansing” that cleared the funding rates of all altcoins. This means that a significant number of leveraged positions were forcibly closed due to the sharp decline of the market.
The funding rate is the mechanism by which cryptocurrency exchanges constantly ensure that the futures market price remains in line with the spot market price. Liquidation of many leveraged positions can lead to extreme market fluctuations and price deviations. In most cases, this will cause the funding rate to return to neutral levels.
Analysts believe that such events help clear excess leverage, speculative positions and weak hands from the market. This paves the way for a healthier and more sustainable price movement in the future. By being freed from the burden of excessive speculation driving prices, the market could potentially find a more stable base for growth.
‍ #Market correction: Buy the dip or wait?#