Several altcoins are showing strong performance in the second week of November, attracting optimistic traders. However, XRP, Zcash (ZEC), and Starknet (STRK) face a high altcoin liquidation risk this week. Data from Coinglass reveals that hundreds of millions in long positions are in danger amid potential market corrections.
Optimism for XRP is fueled by the potential approval of spot ETFs. Several applications, including those from Franklin Templeton and Bitwise, have appeared on the DTCC list, boosting confidence. On the other hand, Zcash (ZEC) has experienced a 10x rally, hitting $750 before a correction. Starknet (STRK) also surprised with a 30% daily surge. Nevertheless, analysis of liquidation maps paints a risky picture for those trading with leverage.
The derivatives market shows excessive leverage on these coins. Traders are betting heavily on continued rallies. However, fundamental data presents conflicts. In XRP’s case, while ETFs generate excitement, recent analysis shows a sharp decline in new XRP addresses, signaling weakening interest from new investors.
Is the current optimism a trap for leveraged traders?
If XRP falls toward $2.10, over $340 million in long positions could be liquidated, according to Coinglass data. For Zcash, a drop to $540 would liquidate $72 million in longs. Investor Gunn warned about ZEC, stating “parabolic charts rarely sustain in the short run”, after selling 90% of his holdings. Furthermore, Starknet faces an imminent threat. According to CryptoRank, 127 million STRK tokens will be unlocked this week, which could add significant selling pressure. If STRK retreats to $0.128, $14 million in long positions are at risk.
The second week of November is crucial for these assets. The altcoin liquidation risk is palpable, especially for leveraged long positions. Traders must closely monitor key support levels and fundamental events, like the STRK token unlock. Volatility seems guaranteed as optimism battles selling pressure and technical exhaustion. This scenario tests the sustainability of recent gains in the blockchain sector.
