Bitcoin(BTC) short sellers are sweating it out, with a massive $1.67 billion poised for liquidation if the price climbs back to $70,000, according to CoinGlass data. This has many analysts questioning if a return to all-time highs is imminent, despite the recent lull.
Short Squeeze Threatens Bitcoin Bears
Traders betting against Bitcoin (BTC) are facing a potential short squeeze if the price breaks above $70,000. Short selling involves borrowing Bitcoin, selling it high, and hoping to buy it back later at a lower price to pocket the difference. However, if the price goes up instead, short sellers are forced to buy back at a loss, potentially triggering a cascade of liquidations.
Analyst: Bullish Market Signals Potential Bounce
Pseudonymous crypto trader Ash Crypto highlights the precarious situation for short sellers, while crypto CEO Joshua Jake emphasizes the overall bullish market sentiment. Bitcoin’s open interest (OI), which reflects outstanding futures contracts, has dipped from its June 7th peak but remains significantly higher than January 1st, indicating an underlying market interest.
Also Read: Australia Goes Crypto: First ASX Bitcoin ETF Debuts With $3 Billion APAC Market on Horizon
Liquidations as Stepping Stones to New Highs?
Some analysts, like Willy Woo wrote, believe a significant short squeeze could pave the way for Bitcoin to reach new all-time highs.
He suggests that “pain and boredom” might be necessary before a bullish surge. This echoes the sentiment of Julien Bittel, who describes the current price action as the “Boring Zone” before a potential breakout.
Bitcoin’s Future: A Tug-of-War Between Bulls and Bears
With a significant amount of short positions at risk and bullish undercurrents, Bitcoin’s near-term price action remains uncertain. Whether the bulls can push the price back to $70,000 and trigger a short squeeze, or if the bears manage to keep it down, will be a story to watch in the coming days.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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