Short liquidation volume exceeds $145 million, Bitcoin short squeeze rebounds and temporarily surpasses $70k

Zhitong Finance APP learned that on Monday, the price of Bitcoin first broke above the $70k mark since March, rising more than 4% at one point to around $70,300, before the gains later narrowed. At the same time, major crypto assets such as Ethereum and Solana also strengthened in tandem.

This rally was mainly driven by short-covering in the market. Although the outlook for Middle East ceasefire talks remains unclear, Iran has rejected a temporary ceasefire plan and demanded a complete end to the conflict, and the market’s positioning that had previously become overly pessimistic began to adjust rapidly. Diana Pires, Chief Business Officer of sFOX, said that before the weekend, market sentiment was clearly more bearish, with shorts having accumulated more positions. News about the ceasefire triggered large-scale liquidations, thereby pushing prices higher.

Data show that over the past 24 hours, more than $145 million worth of short positions have been forcibly liquidated. CoinGlass noted that as Bitcoin’s price rises, more shorts passively stop out and exit. Damien Loh, Chief Investment Officer of Ericsenz Capital, said that in an environment with lower liquidity, shorts shift to other assets and cover their positions, intensifying the “short-squeeze”-style surge in prices.

However, over a longer time horizon, Bitcoin is still in a range-bound market. Since late February, when the Iran conflict erupted, Bitcoin has largely been trading in the $60k to $75k range. During that period, it briefly rose to nearly $76k, but then pulled back. For most of the past two weeks, its price has remained below $70k.

Blockchain data firm Glassnode said that whenever Bitcoin approaches the $70k to $80k range, market liquidity is thinner and there is a clear pressure to lock in profits, which limits room for a rebound. At the same time, the options market is shifting toward more defensive positioning.

From the derivatives market perspective, the largest open interest is concentrated in put options with a strike price of $60k. Coinbase’s Deribit data show that investors are still hedging potential downside risks through put options.

On the other hand, there are signs of improvement in institutional capital flows. The U.S.-listed spot Bitcoin ETFs recorded about $22.30 million in net inflows last week, a clear rebound from nearly $300 million in net outflows the week before.

However, overall market participation remains low. Glassnode said that whether it’s exchanges, ETFs, or on-chain activity, capital participation has not noticeably recovered, meaning the sustainability of the current rebound remains to be seen. Analysts believe that in order to support a more solid upward trend, trading volume, capital inflows, and on-chain activity all need to improve in sync.