Liquidity Builds Above Bitcoin (BTC) Price—Bearish Signal or Short Squeeze Setup?

The liquidation heatmap shows a dense concentrati

The liquidation heatmap shows a dense concentration of leveraged positions above the current Bitcoin price, with the largest cluster forming near $98,000, holding over $300 million in potential liquidations. Downside liquidity below $82,000 appears comparatively thin, indicating much of the sell-side leverage has already been cleared. This imbalance suggests volatility is skewed toward upside tests, though failure to regain momentum could keep the price range-bound until leverage rebuilds.

$98,000 Emerges as a Critical Liquidity-Driven Zone

If Bitcoin (BTC) price advances toward the $98,000 level, liquidation heatmap data suggests a sharp increase in volatility rather than a clean breakout. The zone hosts over $300 million in leveraged positions, making it a high-probability liquidation trigger. A move into this area could force the unwinding of overleveraged positions, generating rapid buy-side orders and increasing the risk of a short squeeze. However, once this liquidity is absorbed, price behaviour will depend on sustained spot demand. As such, $98,000 should be viewed as a liquidity turning point, not a confirmed resistance or support level.

FAQs

How do liquidations influence Bitcoin’s current price action?

Price is now driven more by leverage positioning than spot demand. Dense liquidation clusters above the current price create pressure zones that can accelerate moves.

Is Bitcoin’s pullback over, or is deeper downside risk possible?

Downside risk remains. While some buy interest emerged near $81,000, the overall structure is bearish until Bitcoin can decisively reclaim higher support levels.

What does the Bitcoin liquidation heatmap show?

It reveals heavy liquidation clusters near $98,000 and thinner leverage below $82,000, indicating volatility is skewed toward potential upside tests in the near term.

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