STABLE plummets 18% - Fakeout above $0.04 traps bulls

In the past 24 hours, the crypto market witnessed $650.35 million in liquidations. Of these, $622.85 million were long liquidations. These forced long closures added to the downward pressure.

Bitcoin [BTC] saw $205 million in liquidations after losing 3.14% in 24 hours. The move came as a slight surprise after BTC bounced from the $78.9k support level on Wednesday, the 13th of May. It could only reach as high as $82k before sliding lower.

Stable bulls unable to reclaim range highs

The recent Bitcoin selling has impacted altcoin market confidence and resulted in market-wide losses. Stable [STABLE] was down 18.7% in the past 24 hours. Earlier in the week, it had looked as if it had breached a range formation it had been trading within since February.

Source: STABLE/USD on TradingView

In the final week of April, AMBCrypto had reported that STABLE was trading within a range formation that reached from $0.024 to $0.039. On Tuesday, the 12th of May, a daily session close at $0.04, above the range highs, confirming a breakout.

This move didnt last. After a sweep of the $0.044 liquidity pocket, the bears seized control, enforcing the rapid losses in recent days.

Anticipate further losses after a brief bounceSource: STABLE/USD on TradingView

The 1-hour chart showed heavy bearish momentum and selling pressure. The A/D indicator and the Awesome Oscillator were plunging lower in the past 24 hours to reflect this.

Meanwhile, the Money Flow Index presented a bullish divergence. The price made lower lows while the indicator made higher lows.

By itself, it does not make a strong argument for a potential price bounce. However, two other factors help this idea.

The first is that the divergence comes alongside a test of the mid-range support. This could see a bounce to the $0.037-$0.038 local resistance, which had been a support area in recent days.

Source: CoinGlass

The second factor was the cluster of long liquidations around $0.03. It is possible that a sweep of this strong magnetic zone could see a brief price bounce as STABLE market participants sense overextended conditions.

A drop to the range lows at $0.024 remained likely, especially as it was near another sizeable cluster of long liquidations.