The crypto market is on high alert as the possibility of further upward momentum in the Bitcoin price threatens to trigger a massive wave of liquidations. New data suggests that $9.41 billion worth of short positions could be wiped out if Bitcoin reaches the $90,000 price high.
Short Sellers Face Potential Wipe Out At $90,000
According to reports from Seth, a crypto analyst on X (formerly Twitter), the market could experience another surge of liquidations, as $9.41 billion in shorts stand at risk if Bitcoin hits the $90,000 mark. Additionally, market data shows a significant buildup of short positions, which could trigger a short squeeze if BTC continues to trade upwards.
Seth shared a chart with a Bitcoin liquidation heatmap, which shows that a large volume of short liquidations is concentrated between $80,000 and $90,000, with the largest risk zone at the latter. As a result, traders should watch for resistance or momentum shifts around this key price range.
If Bitcoin climbs to the $90,000 level, it could force traders who bet against its price to cover their losses, leading to even higher prices. Notably, short liquidations occur when traders who bet against the possibility of the asset rising are forced to close their positions due to increasing prices. If the price goes up exponentially, short sellers will be compelled to buy back BTC at a loss while their brokers automatically liquidate their positions.
Seth’s chart report shows that liquidation volumes have been steadily increasing as Bitcoin surpasses key resistance levels. About a week ago, a surge to $87,000 had wiped out $77 million in Bitcoin short positions.
An even larger liquidation event is stated to unfold at $90,000, which now acts as a psychological barrier for Bitcoin. Moreover, a short squeeze could hit the market if BTC reaches this level. This event often brings high volatility, as large liquidation spikes push prices higher. Additionally, forced buybacks from short sellers may accelerate BTC’s surge, driving more momentum.
According to CoinMarketCap, Bitcoin’s price is $83,029 as of writing, having increased by 1.12% in the past 24 hours. Traders are likely watching closely as the market inches toward the $90,000 mark, which would represent a potential 8.39% increase from the cryptocurrency’s present market value.
BTC Price Pushes For $94,000 Breakout
‘Crypto Fella,’ a market expert on X, warns that Bitcoin could face a significant market shakeout soon. However, once it settles, a massive breakout may follow.
Sharing a price chart showing this breakout scenario, the analyst highlighted a black zigzag line that suggests a possible drop in the Bitcoin price to the purple support and demand zone between $78,692 and $70,000. Once BTC hits this range, the price is expected to push toward the analyst’s projected $94,655 target.
Featured image from Unsplash, chart from Tradingview.com
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