Bitcoin faces a liquidation squeeze: a breakout or a drop, with $651 million in liquidations waiting.

According to the latest data, Bitcoin is currently facing an interesting technical situation: whether breaking upward or downward, a significant liquidation pressure is waiting. This not only reflects the structural characteristics of the derivatives market but also hints at the complex mindset of current market participants.

Symmetrical Liquidation Pressure in Both Directions

Based on Coinglass data, if BTC breaks above $94,885, the liquidation strength of longs on major CEXs will reach $651 million. Conversely, if BTC falls below $86,707, the liquidation strength of shorts on major CEXs will also reach $651 million.

This data point is quite interesting: the liquidation strength in both directions is exactly the same, at $651 million. This means that the positions of longs and shorts in the market are roughly equal around these two price levels.

Meaning of the Current Position

BTC’s latest quote is around $90,775.90, situated in the upper middle of the $86,707 to $94,885 range. In other words, it is about $4,100 below the upper liquidation price ($94,885) and about $4,000 above the lower liquidation price ($86,707). This symmetrical distance distribution indicates that market participants are quite conflicted about the price direction.

Actual Meaning of Liquidation Strength

Liquidation strength is not an exact count of contracts pending liquidation but an indicator of how much impact the price will experience when reaching a certain level. Higher liquidation strength means that when the price hits that level, the resulting liquidity wave will produce a more intense reaction. In other words, once the price touches these key points, chain reactions may occur.

Complex Signals of Market Sentiment

This liquidation data needs to be interpreted in conjunction with other market indicators.

Sell Pressure Signal in the US Market

Coinbase Bitcoin premium index has been in negative premium for five consecutive days, latest at -0.126%. This indicates that BTC prices on Coinbase are below the global average, reflecting significant sell pressure in the US market. Over the past 28 days, 26 days have been in negative premium, suggesting this is not a short-term phenomenon. Negative premium usually means US investors’ risk appetite is declining or there is capital outflow.

Funding Rate Returning to Neutral

According to the latest data, funding rates on major CEXs and DEXs have returned to neutral, indicating the market is no longer bearish on BTC and ETH. However, it is worth noting that altcoins still exhibit large-scale negative funding rates, reflecting cautious market sentiment towards risk assets.

On-Chain Fund Flows Signal

In the past 7 days, CEXs have experienced a net outflow of 6,317.80 BTC, with the largest outflows from OKX, Kraken, and Bitfinex. This continuous withdrawal behavior is often interpreted as long-term holders accumulating, but it may also reflect traders reducing leverage risk.

Possible Short-Term Market Directions

From a technical perspective, BTC is currently positioned between the two liquidation levels, which is a relatively balanced position. However, this balance is often fragile—once the price breaks either side, chain reactions of liquidation may be triggered.

True Reflection of Market Sentiment

Combining liquidation data with Coinbase negative premium and funding rate data, the market presents a “uncertain” state. On one hand, the return to neutral funding rates indicates the market is no longer extremely bearish; on the other hand, Coinbase’s persistent negative premium and US market sell pressure suggest institutional investors remain cautious.

In the past 24 hours, the entire network experienced liquidations totaling $415 million, with $335 million in longs liquidated, indicating that recent volatility has caused longs to suffer more losses. This may reinforce risk aversion among some investors.

Summary

Bitcoin is currently facing a symmetrical liquidation pressure scenario: $651 million in liquidation strength on both the upside and downside. This reflects a significant divergence in market participants’ views on the price direction. Considering Coinbase’s negative premium, the return to neutral funding rates, and ongoing on-chain fund withdrawals, the market is at a delicate balance—neither extremely bullish nor extremely bearish, but full of uncertainty. In the short term, whether the price breaks above $94,885 or falls below $86,707 could trigger substantial liquidation waves. For traders, the key is to understand the significance of these liquidation levels rather than blindly predicting the direction.