Jerome Powell’s update to shake markets up? Whales brace themselves for a dip, but there’s a twist.
Blockchain intelligence company LookOnChain just reported a fresh wave of bearish allocations on several major-cap altcoins, as well as Bitcoin (BTC). In further detail, the three crypto whales in question have made humongous profits during the previous bear cycles.
Highly-Profitable Bear Goes Hard On XRP & ETH
With the most profitable out of the three whipping up $160 million gains from Bitcoin (BTC) & Ethereum (ETH) shorts on last weekend’s crash, two other heavyweight-class crypto players took inspiration, placing cross shorts on Dogecoin (DOGE), Pepe Token (PEPE), Ripple (XRP) Ethereum (ETH), Aster coin (ASTER) & Solana (SOL).
In the first instance, the crypto whale put a brave XRP coin short play with 20x leverage, and is already $263K down in unrealized profits, despite XRP’s price moving just 4 cents above the entry value. An identical play on Ether (ETH) is also down $157K, despite Ethereum’s price dropping back below $4K on Tuesday morning.
Divisive Market Instability Ahead Of FED Speech
However, this short-selling crypto whale is up $3 million in unrealized daily profits, as the other three short-selling plays with significantly smaller leverage seem to go their way. With Dogecoin (DOGE), Pepe Token (PEPE) & Aster coin (ASTER) all sharing 3-5x multiplied leverage, the whale expects these altcoins to dip further down.
Due to current market instability, the set of these 5 leveraged short-selling plays on XRP, ETH, PEPE, DOGE & ASTER could go both ways. The overall market sentiment shifted from last week’s greed to fear today, tumbling from 70 to 38 in a matter of days. However, Solana (SOL) might have exceeded expectations of some bears.
The third crypto whale in question poses a different example, with the 20x leveraged Solana (SOL) price play falling short with $1 million in unrealized losses. Ultimately, crypto market watchers are expecting a further dip during the FED Chair Jerome Powell’s speech today.
This assumption might encourage more crypto whales to book profit before the Fed Chair drops knowledge on the economic situation later on today, even though a mention of a Fed rate cut is still plausible.
On The Flipside
* Since last Friday, most altcoins trashed their previous resistance thresholds, including XRP below $2.5 & Dogecoin below $0.20.
* For some analysts, this serves a favorable entry point as most major-caps are already 25-35% down in monthly terms.
Why This Matters
Leveraged trading is at an all-time high, racking up billions in trading volumes daily. However, the adoption of leverage on the crypto markets magnifies liquidation risks due to exposure to potentially larger gains.
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