Bitcoin Plummets Below $26K As Stronger Dollar Abates Investors' Appetite For BTC; Liquidations Hit Over $120M

The price of Bitcoin nosedived below $26,000 on Thursday, a first in two weeks, as the stronger dollar reduced investors' appetite for BTC, causing the world's first-ever crypto asset to see more than $120 million in liquidations.

Bitcoin plummeted by 1.92% to $25,880, which also recovered afterward and lingered under $26,500, up by 0.3% but still below $27,500, its nearly two-week-long range.

The maiden crypto, which is also the world's largest digital asset by market capitalization, has melted some of its gains acquired this year as investors face a variety of macroeconomic uncertainties, including the ongoing negotiations over the debt ceiling, which will tell if the government would be able to pay all of its bills.

Bitcoin's negative DXY correlation also continues, with the U.S. dollar index surpassing 104, a 3.2% ascend from its last month's performance, while BTC experienced a downtrend over the same period.

The U.S. dollar index or DXY is the metric used to check the value of the U.S. dollar relative to the bulk of its most crucial trading partners.

The decline in the price of Bitcoin triggered liquidations, resulting in a cumulative outflow of hundreds of millions over the past 24 hours, according to data from CoinGlass.

The maiden crypto saw a total outflow of more than $120 million with long traders credited for the majority of outflows and short traders responsible for the remaining portion of the pie.

"In the past 24 hours, 44,125 traders were liquidated, the total liquidations comes in at $120.37 million," CoinGlass shared, noting that "the largest single liquidation order happened on Bybit-BTCUSD value $2.93M."

About Bitcoin's performance, a trader tweeted that an ideal scenario would be a reclaim in the $26,600 level, which would allow the maiden crypto to trade at its previous price range.

"Bears failing to push price lower, as we retest that support area from below. All eyes [are] on the daily close still, #Bitcoin needs to hold 26.3 in order for that daily bullish div to lock in," the user said, adding that "Ideal scenario; reclaim 26.6 and back into the previous range."

Bitcoin has slowly climbed from below the $26,000 price level as it saw a 0.98% gain and was trading upward at $26,447.06, with a 24-hour trading volume of $12,921,391,294 as of 11.55 p.m. ET Thursday, according to CoinMarketCap.