Cryptocurrency Market Plummets as Bitcoin Reverses Gains

Cryptocurrency markets experienced significant declines over the past 24 hours, with major tokens slipping by as much as 8%. Bitcoin (BTC) led the downturn, reversing gains from the previous week amidst selling pressure driven by a stronger dollar. This resulted in over $400 million worth of bullish bets being liquidated.

Data reveals that Bitcoin dropped by 5%, mirroring losses seen in other major tokens such as Ether (ETH), Cardano's ADA, and BNB Chain's BNB. Solana's SOL witnessed a 9% decline, trading at $180 after briefly touching $200 on Monday, while Dogecoin (DOGE) saw a drop of over 10%. Bitcoin Cash's BCH fell by 12% due to profit-taking following a 40% rally in the past week, fueled by anticipation surrounding the upcoming halving event for the network on April 4th.

Long positions, reflecting bets on higher prices, accounted for over $400 million in liquidations, whereas shorts, indicating bets against price increases, saw relatively smaller liquidations totaling $85 million. Liquidations occur when traders lack sufficient funds to maintain leveraged trades. Some long-term investors have been selling off holdings over the past week. They anticipate Bitcoin to trade within a range in the coming weeks, citing the selling pressure from long-term holders (LTHs) as a factor.

Bitcoin is likely to continue to consolidate within a range, as previously dormant supply, particularly among Long-Term Holders (LTHs), is being sold (although at a relatively smaller scale than previous bull market tops). 

Bitcoin faces resistance at the $71,000 level, coinciding with cautious sentiments in broader markets towards riskier assets. "Bitcoin's fourth attempt to consolidate above $71K this week was unsuccessful. The Nasdaq100 also showed some downward bias, indicating a cautious attitude towards risky assets, although the S&P500 closed at another high. Bitcoin encountered strong resistance, with attention shifting to levels at $69.5K and $68.5K.