As Bitcoin nears new highs, a massive wave of liquidations on derivative products has rocked the market, causing an 835% imbalance in favor of long positions. Analysis of this significant event for crypto traders.
As the Bitcoin (BTC) price approaches new all-time highs, a sudden surge in short liquidations has created an unprecedented imbalance in the derivatives markets. Within just one hour, no less than $15.43 million in Bitcoin positions were liquidated, with $13.78 million coming from short positions compared to only $1.65 million from long positions. This represents a massive imbalance of 835.15%.
This kind of extremely asymmetric positioning in crypto derivatives often signals abrupt market movements, amplified by high leverage and automatic margin calls. Such an imbalance indicates a sudden capitulation of bears, trapped in a monumental short squeeze.
The term “liquidation imbalance” refers to a disproportion in forced automatic closure positions (liquidations) between long and short positions. In this situation, the overwhelming majority of liquidations involved short sales, signaling that many traders were betting on a BTC price drop… until the market suddenly reversed.
Across the entire crypto market, $364.32 million were liquidated in 24 hours, with $266.99 million from short positions and $97.33 million from long positions. Bitcoin alone accounted for more than $114 million in liquidations, illustrating BTC’s dominance in this upheaval.
Derivatives markets, which include futures contracts, options, and structured products, have become one of the preferred playing fields for experienced cryptocurrency investors. These products, available on platforms like Binance Futures, Bitget Futures, Deribit, or dYdX, allow for amplified exposures… but also colossal losses.
The observed short squeeze corresponds to a phenomenon where the price rises rapidly, forcing short sellers to buy back urgently, which fuels the sudden price surge even more.
After this spectacular bloodbath, Bitcoin has found stability just below the psychological resistance of $120,000 (approximately €112,000). According to several analysts, maintaining above $119,500 would signal the possibility of a rally toward $122,000 or even a new ATH. This would reinforce the effect of the shockwave caused by the liquidations and the intraday structural evolution of order books.
With this liquidation imbalance of 835%, the market clearly remains biased in favor of Bitcoin buyers. Short sellers paid a heavy price in this violent movement, and the current structure suggests that bulls could maintain their advantage—at least in the short term. The “short squeeze” represents a major indicator for investors monitoring crypto market dynamics as we approach potential all-time highs.
Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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