Bitcoin could be on the verge of igniting a massive short squeeze, as analysts suggest that a modest 9% rebound from current levels may be enough to liquidate more than $8 billion (Rp860 trillion) worth of short positions across the crypto market.
According to a post from Bitcoin Archive, a leading on-chain analysis account, if Bitcoin (BTC) manages to break above the $113,000 price zone, it could trigger a wave of forced liquidations among traders betting against the asset — potentially fueling a strong continuation rally.
Short Squeeze Could Act as “Rocket Fuel”
The analysis describes the situation as potential “rocket fuel” for Bitcoin’s next leg upward. A short squeeze occurs when traders who bet on falling prices are forced to buy back their positions as prices rise, which in turn drives the price even higher.
In this case, Bitcoin only needs a relatively small rebound — about 9% from current levels — to put immense pressure on leveraged short traders.
As of the latest data from CoinMarketCap, Bitcoin is trading around $103,000, down more than 18% from its early October highs. Despite the correction, the potential for a rapid reversal remains strong, given the scale of short exposure currently in the market.
Understanding the Mechanics Behind the Squeeze
Short positions are essentially bets that an asset’s price will fall. When prices move in the opposite direction, traders holding these shorts must close their positions — often by buying back Bitcoin — to avoid further losses. This buying activity creates sudden upward pressure, amplifying market volatility.
Historically, large-scale short squeezes have often marked turning points in Bitcoin’s market cycles, with previous examples in 2021 and 2023 leading to rapid multi-day rallies.
Market Sentiment Remains Cautious but Watchful
While the broader crypto market remains cautious following weeks of correction, many traders are closely watching the $113,000 resistance zone as a potential catalyst for renewed momentum.
If Bitcoin manages to reclaim this level, analysts believe it could trigger a domino effect in liquidations — setting the stage for one of the most dramatic short squeezes of 2025.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always Do Your Own Research (DYOR) before making any investment decisions.