Bitcoin finally broke through the $100,000 barrier, hitting an all-time high of $103,600. The milestone is a historic moment for the cryptocurrency as investors and enthusiasts celebrated its journey to six digits. However, the happiness was short-lived. Within hours, BTC experienced a sharp reversal, plunging to $92,000 in a dramatic sell-off that rocked the market again.
Prominent analyst Axel Adler reached out to X to explain the sudden drop, pointing to the overwhelming number of high-leverage positions as the main culprit. According to Adler, as BTC exceeded $100K, a cascade of liquidity was triggered, leading to a rapid correction. Leverage, a double-edged sword in crypto markets, added downward pressure as traders who borrowed too much were forced to exit their positions.
While the retracement rocked the market, BTC remains above critical levelsAnalysts are debating its next move. Many believe this pullback is a healthy reset, paving the way for a more sustained rally. Others worry that it could signal further instability. As BTC strengthens after this historic rally and sharp correction, all eyes are on whether it can reclaim the $100K level and hold it as support in the coming days.
Bitcoin open interest is showing us something
Bitcoin has experienced one of its most volatile days this cycle, falling from $103K to $92K in less than 24 hours. This sharp reversal has left many investors wondering what led to such a drastic move after the euphoria surrounding Bitcoin’s new all-time high. According to the main statistics From CryptoQuant analyst Axel Adler, the sharp drop can be attributed to a significant delivering event in the futures market.
Adler explained that the liquidity of the long positions played an important role in driving the price down. As BTC rose to $102K, many traders were holding high positions, and when the market turned against them, the forced liquidations created a cascading effect.
This deleveraging pushed the price down from $102K to $90K, as traders rushed to close positions and minimize their losses. Adler described this as a necessary “shake-up,” noting that the market had been moving too smoothly for the bulls, leading to a natural correction.
With BTC now trading low, the next few days will be crucial in determining its direction. While the correction can be seen as a healthy pullback, there is a risk that it could mark a local top for BTC, especially if it fails to regain key levels like $100K.
Investors and analysts are watching closely to see if BTC can stabilize above these levels or if more downside is on the horizon. Volatility and rapid price changes highlight the risks inherent in BTC trading, especially during such high-stakes periods.
Uncertainty hitting the market
Bitcoin is currently trading at $98,000 after yesterday’s volatile price action, where it reached a new all-time high before retracing. The market is now experiencing uncertainty as bulls continue to push for price to run above recent highs, while bears believe it may be time for a correction. This conflict between buyers and sellers is creating uncertainty in the short term.
For Bitcoin to confirm the continuation of its bullish trend, it needs to hold above the crucial $95,000 mark in the coming days. If this support level holds, BTC will likely retest its all-time high of $103,600, as bullish momentum continues. A successful break above this level could pave the way for even higher price targets.
However, if Bitcoin fails to hold above $95,000, it could signal a change in market sentiment, leading to a potential correction. A loss of support at this level would suggest that the bears have taken control, and the price could retreat further. The next few days will be crucial to determine whether BTC can continue its rally or whether the market will enter a period of consolidation or decline. Investors will be watching this price action closely for clear directional signals.
Featured images from Dall-E, charts from TradingView
