Bitcoin News Today: Bitcoin drops 6.72% as liquidity sweeps trigger $1.3B in potential liquidations

Bitcoin has recently experienced a sharp price correction of over 6.72%, dropping below $115,000 and triggering liquidity sweeps across major trading platforms, as open interest surged amid heightened volatility [1]. This sharp move caught many traders off guard and raised concerns over potential liquidations, with analysts warning that a further decline below $93,000 could trigger over $1.3 billion in forced exits, signaling a possible bearish shift in market sentiment [3].

The recent price action coincided with Bitcoin sweeping major liquidity zones, particularly around the $116,000 level, which has historically been a key inflection point. Analysts attribute this activity to on-chain order-book data and expert observations, suggesting that Bitcoin is displaying resilience amid the volatility [1]. According to Michaël van de Poppe and CrypNuevo, Bitcoin has reached new all-time highs, confirming its strength in the face of liquidity shifts, especially as institutional investors and ETF inflows continue to influence the market [1].

Despite the turbulence, Bitcoin has shown signs of consolidation, currently hovering around $117,600 with near all-time low volatility levels ahead of a key week for Federal Reserve decisions. The market appears to be in a holding pattern, waiting for macroeconomic signals that could dictate the next major directional move [4].

Trading analysts have identified critical support and resistance levels that could determine Bitcoin’s near-term trajectory. A decisive hold above key support could set the stage for a strong rebound toward higher liquidity targets, while a rejection might deepen the correction and trigger further panic selling [7]. Institutional investors have shown some optimism, with Bitcoin posting a more than 3% gain amid reduced trade frictions and synchronized gains in major equity indices like the Nasdaq and S&P 500 [5].

The broader cryptocurrency market has mirrored Bitcoin’s mixed performance, dipping by 2.37% to a total market cap of $3.92 trillion as investors remain cautious ahead of potential macroeconomic shocks [2]. While Bitcoin eyes a return to the $120,000 level following a weekend rally, the market remains sensitive to any signs of trade escalation or regulatory uncertainty [2].

Overall, the recent price swings highlight the fragile liquidity environment in the crypto space, with open interest and leverage levels serving as key indicators of market stability. Traders and analysts continue to closely monitor price action, especially as key support levels are tested and macroeconomic developments unfold [1].

Sources:

[1] AInvest: Bitcoin's 6.72% Drop Triggers Liquidity Sweeps and Open Interest Surge (https://www.ainvest.com/news/bitcoin-news-today-bitcoin-6-72-drop-triggers-liquidity-sweeps-open-interest-surge-2508/)

[2] BlockchainReporter: Bitcoin Eyes $120K After Weekend Rally As ETH Gains Fuel Risk-On Flows (https://blockchainreporter.net/bitcoin-eyes-120k-after-weekend-rally-as-eth-gains-fuel-risk-on-flows/)

[3] Facebook Group: Bitcoin liquidation heatmap update and price movement (https://www.facebook.com/groups/2854679244843623/posts/4007261186252084/)

[4] Coinbase: Bitcoin Price, BTC Price, Live Charts, and Marketcap (https://www.coinbase.com/en-ca/price/bitcoin)

[5] CryptoDnes.bg: Best Wallet Token: News & Updates (https://cryptodnes.bg/en/tag/best-wallet-token/)

[7] TradingView: Support and Resistance — Trading Ideas (https://www.tradingview.com/ideas/supportandresistance/page-2/)