Bitcoin fell sharply from over $100,000, and the entire network liquidated $690 million
After the New Year of 2025, Bitcoin briefly returned to over $100,000, but it only lasted about a day before a correction began. As of today (January 8), the price of Bitcoin is $97,041, down about 4.7% on the day, and has fallen to around $96,000 at its lowest.
According to data from CoinGlass, in the past 24 hours, the number of people whose positions were liquidated in the global cryptocurrency market exceeded 230,000, and the total amount of liquidation was approximately US$690 million. Among them, the amount of liquidation of long orders (buy orders) exceeded US$600 million, which was much higher than the amount of liquidation of short orders (buy orders).
In addition to Bitcoin, other major coins also experienced corrections, such as Ethereum ($ETH) and Solana ($SOL) which fell by 7%, while Avalanche ($AVAX) and Chainlink ($LINK) dropped by 8% to 10%.
So how did Bitcoin suddenly drop from $100,000 to around $96,000?
Foreign media (CoinDesk) believes that the main reason for this drop is the strong economic data from the United States. The U.S. Bureau of Labor Statistics released November JOLTS job vacancy data, showing that the number of job vacancies unexpectedly rose from 7.8 million the previous month to 8.1 million, far exceeding analysts' expectations of 7.7 million.
At the same time, the ISM Services Purchasing Managers' Index (PMI) for December reached 54.1, exceeding the expected 53.3 and last month's 52.1. In particular, the prices paid sub-index soared to 64.4, far above the expected 57.5 and last month's 58.2.
These economic data have pushed the yield on the U.S. 10-year Treasury bond up by 5 basis points to 4.68%, close to a multi-year high.
According to the CME's FedWatch tool, the market's expectation of a rate cut in March dropped from nearly 50% a week ago to 37%, and the likelihood of a rate cut in May also fell below 50%. Kyle Chapman of Ballinger Group stated that investors now expect the total rate cut for the year 2025 may only be one basis point.
On the other hand, Keith Alan, co-founder of Material Indicators, pointed out that this drop is related to 'spoofing' operations.
This is a behavior where large funds intentionally create false buy and sell orders on the order book to shift liquidity, causing prices to experience significant fluctuations in a short period of time. He marked several obvious traces of 'fake orders' in the order book liquidity data chart below, showing the sudden shift of liquidity.
What will happen to Bitcoin in the future? Will it drop to $92,000 again?
Regarding Bitcoin's future market, analysts generally maintain a cautious attitude. Trader Justin Bennett warned that if Bitcoin falls below the support level between $97,000 and $98,000, it may test the low of $92,000 again. Another analyst, Scott Melker, suggested paying attention to the support situation of the 50-day moving average, which also happens to fall near this support area.
Analyst Cheds Trading is focusing on the head and shoulders pattern in Bitcoin's daily chart. He believes that the current correction may affect the likelihood of Bitcoin reaching a new all-time high again, but this is just a normal correction. He pointed out that Bitcoin's support level is roughly between $95,000 and $96,000, as well as around $92,000.
Renowned analyst Rekt Capital stated that for Bitcoin to confirm a successful retest, the daily closing price must remain above $101,165. In other words, Bitcoin must stabilize above the key threshold of $100,000 to regain upward momentum.
