Key Altcoins at Risk of Liquidation This February Week
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A Senior Altcoin Analyst, Sarah combines on-chain data with a background in venture capital research. With a Master’s in Computer Science, she provides precise evaluations…
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As February progresses, the cryptocurrency landscape has seen some altcoins experiencing a rebound. Despite this uptick, a prevailing sense of caution remains, with traders’ overconfidence potentially leading to significant liquidation events.
This week, particular altcoins like XRP, DOGE, and TAO are under scrutiny, not just for their developments but also for the risks that accompany their trading movements.
XRP’s Volatility
The current liquidation overview for XRP indicates that Long positions carry a slightly higher liquidation volume compared to Short positions. A slide in XRP to $1.30 could trigger over $200 million in Long liquidations, while a jump past $1.63 might result in about $150 million in Short liquidations.
After a brief rally to $1.66 on Sunday, XRP’s price quickly retreated below $1.50 on Monday. An analyst pointed out significant selling pressure traced back to the Upbit exchange, as noted by the XRP Spot Cumulative Volume Delta.
According to reports, around 50 million XRP were sold on Upbit within a mere 15-hour window, contributing to this considerable selling pressure. This trend coincided with the Lunar New Year, a time known to impact liquidity in many Asian markets.
In South Korea, XRP plays a substantial role in trading volumes on Upbit and Bithumb, making it susceptible to selling actions from Asian traders, which may pose risks to Long positions.
Dogecoin’s Cautionary Signals
The Dogecoin community has recently been abuzz with optimism, prompting many traders to invest in Long positions this week. However, caution is advised; should DOGE drop to $0.091, it could see nearly $90 million in Long liquidations. Alternatively, a rise to $0.114 could incite around $53 million in Short liquidations.
Data indicates that DOGE exchange balances surged starting February 12, aligning with a recovery fueled by speculation surrounding the forthcoming launch of X Money. This increase suggests that many investors may be utilizing the uptick to liquidate their positions by moving tokens to exchanges.
If this pattern persists, it could lead to a downward correction for DOGE, jeopardizing Long positions.
TAO’s Potential Surge
TAO is making headlines following its recent listing on Upbit, which may provide a boost to its price trajectory. The liquidation analysis shows that if TAO exceeds $283, Short positions could face over $13 million in liquidations, while a decline to $160 could unleash $11.5 million in Long liquidations.
With the crypto community increasingly focused on AI technologies, Bittensor (TAO) is aligning with a long-term support level that has some analysts forecasting a potential recovery. One expert expressed confidence in AI-related crypto protocols, believing they are essential for any investment strategy.
New liquidity from Upbit, combined with favorable market sentiment, could create vulnerabilities for TAO’s Short positions, reflecting a complex landscape for traders this week.
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