Bitcoin News Today: Bitcoin Drops 2.63% Below $116K Triggering $731.93M Liquidations in Leverage Flush

Bitcoin’s price plummeted below $116,000 on July 25, 2025, triggering a wave of market liquidations totaling $731.93 million across long and short positions. Over 213,729 traders had their positions forcibly closed within 24 hours, with Bitcoin accounting for $140.06 million of the liquidations as its value fell 2.63% to $115,356 [1]. The selloff followed a brief recovery to $119,300, a level that remains below the recent peak of $123,100 hit on July 14. Ether and Dogecoin also suffered, with $104.76 million and $26 million in long liquidations respectively, as broader risk-off sentiment amplified the downturn [2].

The liquidations were attributed to leveraged trading strategies, particularly among altcoin positions, which market observers describe as a “leverage flush.” Crypto analyst Ash Crypto noted that traders who extended long bets following Ethereum’s rally left themselves exposed to aggressive dumps by market makers, leading to cascading liquidations [3]. This dynamic underscores the fragility of leveraged portfolios in crypto markets, where algorithmic trading and margin calls can rapidly amplify volatility.

Despite the sharp correction, bullish sentiment persists. The Crypto Fear & Greed Index remains at 70, indicating a “greed” reading, while analysts have set ambitious price targets. Galaxy Digital’s Michael Novogratz projects Ether will reach $4,000, Bitfinex analysts see Bitcoin targeting $136,000, and Fundstrat’s Tom Lee forecasts a range of $200,000–$250,000—equivalent to 25% of gold’s market cap [4]. These projections hinge on regulatory developments, such as the recently passed GENIUS Act, which could catalyze broader adoption in the U.S.

Technical analysis highlights critical levels for Bitcoin. Immediate support is at $118,500, with stronger buffers at $117,200 aligning with Fibonacci retracement levels. Resistance lies at $119,300 and $120,250, and a breakout above $123,200 would validate a continuation of the uptrend [1]. The RSI at 48.88 suggests room for growth without overbought risks, while the MACD indicator shows bullish momentum. However, a sustained close below $116,000 could rekindle bearish scenarios, as seen in past corrections.

Market participants are now hedging against further reversals. If Bitcoin retakes the $119,500 level, approximately $3.07 billion in short positions face liquidation risks. Meanwhile, the interconnectedness between crypto and traditional markets is evident, with investors recalibrating exposure amid anticipation of the U.S. Federal Reserve’s policy decisions [2].

The event has reignited debates on risk management in leveraged trading. Regulators and industry stakeholders are scrutinizing the role of margin calls and automated liquidation mechanisms in exacerbating market stress. For now, the focus remains on whether Bitcoin can reestablish control above key technical levels to sustain its multi-year bull run.

Sources:

[1] [Bitcoin Breakdown? BTC Price Analysis Warns of Sharp Drop Below $111K](https://cryptopotato.com/bitcoin-breakdown-btc-price-analysis-warns-of-sharp-drop-below-111k/?amp)

[2] [Bitcoin Tumbles Below $116K in Bloodbath for Crypto Longs](https://where-to-buy.it/news)

[3] [Bitcoin Price Today: Drops Below $116k Ahead of Fed Meet](https://www.investing.com/crypto/ethereum/eth-usd)

[4] [BTC/USD Perpetual Phemex Live Price Chart](https://coinalyze.net/bitcoin/usd/phemex/btcusd/price-chart-live/)