Bitcoin Reaches $106,000 Before Plummeting to $103,000, Triggering Over $600 Million in Liquidations on Derivatives Markets.
A massive short squeeze caused a sharp surge, followed by a collapse due to profit-taking and a illiquid market.
The downgrade of the U.S. credit rating by Moody’s fuels macroeconomic uncertainty, reinforcing volatility on assets like Bitcoin.
Bitcoin Liquid on the Rise and Fall
The weekend offered no respite for traders. Bitcoin briefly crossed $106,000 on Sunday night, only to plummet back to $103,000 just as quickly. The result: over $600 million in liquidated positions, both among bulls and bears. A swift carnage in an ultra-tense market.
A Brutal Short Squeeze, Followed by Bloodbath
The movement started in the dead of night, around 11 pm (Paris time), when BTC gained over $2,500 in less than an hour. Weekend liquidity, key technical zones, algorithmic buying – everything converged to trigger a massive short squeeze. Bitcoin even achieved its highest weekly closing in history above $106,000. Short sellers had to cover urgently… before profit-taking violently reversed the market.
Direct consequence: $460 million in long positions liquidated, $220 million on the short side. ETH, SOL, DOGE, XRP: no one was spared. Over 24 hours, losses reached -4% for Solana, Dogecoin, and XRP.
Macro Uncertainty Looms over Markets
This sudden volatility didn’t come out of nowhere. On Friday, Moody’s downgraded the U.S. credit rating, arousing fears about U.S. debt and inflation. 30-year bond yields crossed 5%, a symbolic threshold. Enough to cast a chill, even on the most resilient assets.
“Investors are moving their capital to Bitcoin in anticipation of the expected explosion in U.S. debt“, analyzes Haiyang Ru, co-CEO of HashKey. But despite excitement about ETFs and institutional flows returning, the market remains under pressure.
Technical Resistance and Explosive Scenario Ahead?
Stagnating throughout the week, Bitcoin currently fails to consolidate above $106,000, a key psychological and technical level. For many traders, this rejection could signal a short-term resistance zone.
The coming days look tense. With the U.S. budget debate and expected new tax measures, traders anticipate heightened volatility. And with an ultra-leveraged market, the slightest spark could be enough to reignite the fire.
