Bitcoin plummeted from above 100,000, and the entire network liquidated US$560 million
After the New Year in 2025, Bitcoin returned to above $100,000, but it only lasted for about a day before experiencing a wave of correction. As of the time of writing today (1/8), Bitcoin was quoted at US$97,041, an intraday decline of 4.7%, with the lowest price reaching around US$96,000.
CoinGlass data shows that in the past 24 hours, more than 170,000 people have liquidated their positions in the global cryptocurrency market, with a total liquidation amount of approximately US$560 million. Among them, the liquidation amount of long orders (buy up orders) exceeded US$500 million, far exceeding that of short positions. The liquidation amount of the order (buy or sell order).
Picture source: CoinGlass Bitcoin plummeted from above 100,000 US dollars, and the entire network liquidated US$560 million.
In addition to Bitcoin, other mainstream currencies also experienced corrections, including Ethereum ($ETH) and Solana ($SOL), which fell by 7%, while Avalaunche ($AVAX) and Chainlink ($LINK) fell by 8% to 10%.
What is the reason for Bitcoin’s sudden drop?
Bitcoin suddenly plummeted from over $100,000 to around $96,000. What was the reason?
Foreign media (CoinDesk) believes that the reason for Bitcoin’s decline is mainly related to the strong economic data in the United States. The U.S. Bureau of Labor Statistics unexpectedly released JOLTS job openings data for November, rising to 8.1 million from 7.8 million in the previous month, far exceeding analysts' expectations of 7.7 million.
Meanwhile, the ISM services purchasing managers' index (PMI) also hit 54.1 in December, higher than expectations of 53.3 and the previous month's 52.1. Among them, the price payment sub-index soared to 64.4, far exceeding the expected 57.5 and the previous month's 58.2.
These strong economic data caused the U.S. 10-year Treasury yield to rise 5 basis points to 4.68%, close to multi-year highs.
The CME Group's FedWatch tool showed that market expectations for a rate cut in March fell to 37% from nearly 50% a week ago, and the probability of a rate cut in May also dropped to below 50%. Ballinger Group's Kyle Chapman noted that investors now expect only one rate cut in all of 2025.
Image source: FedWatch CME Group FedWatch Tool: Expectations for the U.S. Federal Reserve to cut interest rates in March decline
On the other hand, Keith Alan, co-founder of Material Indicators, pointed out that this wave of decline is related to the "spoofing" operation, which is a kind of large funds deliberately transferring liquidity on the order book, causing the price to rise sharply in a short period of time. Due to the volatile behavior, he marked several traces of shifting liquidity blocks in the order book liquidity data below.
Source: Material Indicators Experts believe that the decline of Bitcoin is related to the operation of “spoofing”
What is the future trend of Bitcoin? Afraid of testing 92,000 again?
Analysts are cautious about the future of Bitcoin. Trader Justin Bennett warned that if Bitcoin falls below the support between $97,000 and $98,000, it may retest the low of $92,000; another analyst, Scott Melker, also believes that the 50-day moving average support can be focused on, which happens to be Falling near the support area mentioned above.
Analyst Cheds Trading is paying attention to the head-and-shoulders top pattern of Bitcoin's daily trend, pointing out that the current correction may affect the possibility of Bitcoin rushing to a new all-time high again, and points out that it is a normal correction, with several support levels below falling at 95,000. to $96,000 and around $92,000.
Source: Cheds TradingCheds Trading analyzes Bitcoin support level
Well-known analyst Rekt Capital said that Bitcoin needs to maintain the daily closing price above $101,165 to confirm the success of the backtest, that is, if Bitcoin wants to resume its upward momentum, it must regain the $100,000 mark.
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"The stock price exceeded 500 million magnesium!" Bitcoin fell back to 96,000 overnight, analysts: fear of falling to "this point" again. This article was first published in "Crypto City"
