Bitcoin News Today: Bitcoin near $114,000 triggers $1.78B long liquidation 62% higher than $117,000 short threshold

Bitcoin faces a critical price threshold this week as data from Coinglass reveals that a drop below $114,000 could trigger $1.78 billion in long liquidations across major centralized exchanges [1]. This figure represents the cumulative intensity of positions at risk, signaling a potential liquidity cascade that could amplify downward price momentum. The threshold aligns with a key technical level in the cryptocurrency’s recent trading pattern, heightening market scrutiny of institutional and retail positioning in the $110,000–$120,000 range.

The liquidation intensity metric, derived from Coinglass’s analysis of CEX open interest data, does not reflect exact contract values but rather the relative magnitude of leveraged positions clustered at specific price levels. A taller bar on the liquidation chart indicates a higher probability of price acceleration at that level due to forced liquidation activity. For context, the $1.78 billion figure is 62% higher than the short liquidation intensity threshold at the $117,000 level, where short positions at risk amount to $1.09 billion [1]. This asymmetry suggests stronger near-term pressure from longs, a common feature during bullish trends that could now act as a headwind if the price reverses.

Market participants are monitoring how exchanges manage this liquidity event. Historically, large liquidation clusters have exacerbated volatility as margin calls trigger further selling. The $114,000 level is particularly sensitive because it sits just below Bitcoin’s 200-day moving average, a technical benchmark often cited by algorithmic trading strategies. If the price closes below this threshold, the subsequent unwinding of leveraged longs could create a self-reinforcing dynamic where falling prices trigger more liquidations [1].

Coinglass’s methodology clarifies that the intensity data is not a direct measure of total open interest but a normalized representation of position concentration relative to adjacent price clusters [1]. This distinction is critical for interpreting the $1.78 billion figure: while it signals significant potential for market-moving activity, it does not equate to an immediate $1.78 billion sell-off. Instead, the actual impact will depend on the pace and depth of the price decline, as well as counterbalancing buying interest from longs or new entrants.

The implications for market stability remain uncertain. In bullish cycles, sharp liquidation events have occasionally acted as catalysts for renewed buying, particularly from institutional players seeking discounted entry points. However, the current macroeconomic environment—marked by cautious risk appetite and tightening monetary policy—limits the likelihood of immediate relief rallies. Traders are advised to closely monitor the $114,000 level for signs of a breakdown, with a watchful eye on the Bitcoin-to-ether ratio as a proxy for altcoin liquidity and broader market sentiment.

Source: [1] [BlockBeats] [https://www.theblockbeats.info/en/flash/304557]