Crypto Liquidations Cross $1 Billion Mark: Short Squeeze or Bearish Market Begin?

Crypto Liquidations Surge Over $1 Billion: Signs of Bearish Market or Short Squeeze?

Event Overview

Over the last 24 hours, cryptocurrency traders have collectively lost more than $1 billion in liquidations, with CoinGlass reporting $1.09 billion in liquidations and 181,077 traders wiped out. The key point is who got hit: long traders lost $930.54 million, approximately 85% of the total, while shorts lost only $161.85 million.

Market Analysis

The event was driven primarily by leveraged buyers, not by a short squeeze. The history chart shows the magnitude of the event, with the latest daily bar exceeding $1.2 billion and composed mainly of long positions. Bitcoin has dropped from approximately $86,000 and is now near $82,000.

Recent Market Developments

However, the recent market bounce may trigger a minor short squeeze, and the price's recovery may trap short sellers in their positions. Over the last 12 hours, shorts have shed $46.29 million, whereas longs have lost just $11.08 million. Over the last 4 hours, $13.39 million of the total $16.64 million came from shorts. Shorts made up almost all of the Hyperliquid total, at 99.96%. Real-time statistics show that many ZEC short positions are closing near $1,234, meaning the price has started to recover, trapping short sellers in their positions.

Market Outlook

Both scenarios happened in sequence. Initially, there was a long flush. At present, a minor short squeeze is underway following the recent market bounce. A squeeze of this magnitude does not indicate that the trend has reversed. The hourly totals are low, with just $5.60 million in the past hour, indicating a calming market. Days of significant liquidation often mark a short-term trend change. Forced sellers are no longer present at the lowest point. Should the price fail to recover, they may trigger a bearish phase. Keep an eye on Bitcoin in the $80,000 to $82,000 zone. If it holds and short liquidations continue to rise, a recovery to $86,000 seems probable. If it breaks lower, a new wave of long liquidations may follow, echoing the August spike.