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▲ Coffee and Bitcoin
The temporary ceasefire agreement in the Middle East showed cracks from day one, sharply curtailing the upward momentum across the virtual asset market.
Crypto media outlet BeInCrypto explained that as of April 9, the total virtual asset market capitalization dropped from $2.45 trillion on the previous trading day to $2.39 trillion. Reports of attacks by Gulf states and Iran's demands for conditions for passage through the Strait of Hormuz continued, dampening investors' risk asset preference. The total liquidation volume across the market reached $272.86 million, with 79,415 traders incurring losses. Notably, long position liquidations accounted for $170.42 million, representing 62% of the total. Market caution is escalating ahead of the March Consumer Price Index (CPI) release scheduled for Friday.
Bitcoin (BTC) traded at $71,023 on April 9, down approximately 1%, but its technical structure remains positive. A cup-and-handle pattern formed since late March on the daily chart is still intact, suggesting an upward potential towards $81,000. If Bitcoin closes above $71,673, breaking out of the handle, and surpasses the Fibonacci 61.8% retracement level of $73,272, a full-fledged rally will begin. The downside support is the Fibonacci 38.2% level at $70,074, and as long as $64,899 is not breached, the bullish scenario remains valid.
World Liberty Financial (WLFI) plunged 13.42% to $0.0916 due to aggressive fund management in its self-custody wallet. The trouble began on April 8 when World Liberty Financial's strategic reserve wallet provided 3 billion WLFI as collateral and borrowed USD1 stablecoins worth $50.44 million. The liquidity pool utilization rate exceeded 100%, turning available assets negative, and the deposit interest rate soared to 35.81%. If the price of collateral assets falls further, there is a high risk of a cascade of massive forced liquidations.
Technical indicators also warn of further downside potential for World Liberty Financial. While the price has been making lower lows within a downtrend channel that began in mid-February, a hidden bearish divergence has been observed where the Relative Strength Index (RSI) is making higher highs. If World Liberty Financial fails to defend the $0.090 support level, it could drop vertically to $0.080 and $0.073. To reverse the downtrend, it must reclaim at least $0.096, and establishing a foothold above $0.106 is crucial for short-term structural improvement.
The virtual asset market is engaged in a fierce battle over whether to defend the $2.39 trillion support level. Unlike the stock market, which rebounded on ceasefire news, the coin market is hampered by capital outflow and geopolitical uncertainties. If the Consumer Price Index (CPI) exceeds expectations, pressure on liquidity supply will intensify, and the price adjustment range for speculative assets is expected to deepen further. The market continues to experience volatility between the $2.33 trillion support level and the $2.49 trillion resistance level.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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