- Bitcoin’s drop from its all-time high triggered a classic short setup.
- Could this be the start of the next leg up?
Since Bitcoin [BTC] dropped 3.79% intraday from its all-time high of $111,689 on the 23rd of May, bulls and bears have turned the price zone into a high-stakes tug-of-war.
Strategically, it made sense for opportunistic shorts to enter. Momentum had cooled, weak hands looked ready to fold, and the setup pointed to a sharp move lower.
In short, it was a textbook setup for downside follow-through.
But three days later, Bitcoin is up nearly 3% from that close. The short thesis didn’t just miss, it clearly backfired.
While some might write it off as a “temporary” bounce, data from AMBCrypto suggests this rebound could be more than just noise. Instead, it might be the ignition point for a much larger rally.
Whale’s bet faces market resistance
AMBCrypto recently spotlighted a whale that loaded up on a massive 11,000 BTC long position, which was worth a whopping $1.25 billion at 40x leverage.
However, as Bitcoin neared the liquidation cluster around $105k, the whale pulled the plug and closed out the trade. All that liquidity? Swallowed up like water by a sponge.
Yet, the whale seemed to miss the bigger picture. Just 24 hours later, the same whale flipped short with nearly $1 billion on the line, setting the liquidation mark at $111,280.
The timing? Brutal. Two bullish macro catalysts hit the tape, squeezing the position and forcing a premature exit, with a $15.87 million loss to show for it. Since then, Bitcoin has bounced back to trade near $110,000 at press time.
Source: CryptoQuant
The short strategy backfired big time. Now, it looks like traders are racing to seize the opportunity.
As the chart above shows, Bitcoin’s Taker Buy Volume just blasted past $110.7 million across all exchanges.
Backing that up, Open Interest has surged 3.74% to $77.44 billion, adding $2.45 billion in fresh open positions from the previous day. And guess what? We’re only halfway through the session.
Looks like FOMO’s starting to kick in.
Bitcoin derivatives spike – Master stroke or misstep?
Two massive bets got squeezed and absorbed in under 72 hours, revealing strong underlying bid support for Bitcoin.
Yet, the shorts remain confident, trading like they know something we don’t. About 61.81% of Binance’s BTC/USDT perpetual contracts are leaning short.
If demand cracks now, watch the 12-hour chart. There’s a juicy liquidity cluster at $108,478 with $68.57 million in leverage ready to get smoked.
Source: Coinglass
But if support sticks, another cluster at $110,682 (also packing $68.57 million in leverage) could spark a fresh run at a new all-time high.
Knowing Michael Saylor’s track record, history’s probably about to repeat itself. Another short squeeze incoming? Odds say yes.
