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Bitcoin Short Squeeze: $5 Bln Shorts at Risk If BTC Hits $113K

Bitcoin Short Squeeze: $5 Bln Shorts at Risk If BTC Hits $113K

2025/07/05 13:55
By:
  • $5B+ in shorts may get liquidated if BTC touches $113K
  • Short positions surged even as BTC nears new highs
  • Short squeeze possibility could accelerate price rallies

Bitcoin is trading close to the $110,000 mark, and traders are starting to worry. Short positions have significantly increased, with billions of dollars now at risk. If Bitcoin’s price hits $113,000, analysts say that over $5 billion worth of these short bets could be wiped out.

This potential for a massive Bitcoin short squeeze is growing as the market heats up. A short squeeze happens when traders betting against Bitcoin (shorts) are forced to buy back the asset as prices rise—further driving up the price. It’s a rapid, high-volatility event that can push Bitcoin to unexpected highs.

Recent market behavior shows a steady rise in open interest—money committed to futures contracts—and mostly positive funding rates, meaning more traders are betting on the price going up. This imbalance increases the chance of a dramatic short squeeze.

How a Bitcoin Short Squeeze Happens

  1. Price breaks resistance: If BTC surpasses $113K, key technical levels get broken.
  2. Short liquidations trigger buys: Liquidated short positions turn into market buy orders, pushing prices higher.
  3. Momentum builds fast: Other traders jump in, creating a loop of rising prices and more liquidations.

Such squeezes aren’t uncommon in crypto markets. The current conditions—high leverage, growing shorts, and rising spot interest—make this scenario increasingly likely.

Key Signals to Watch

Indicator What It Shows
Open interest Indicates market positioning
Funding rates Reveal trader bias (long or short)
BTC price levels Critical resistance at $113K+

If the market breaks through $113K, Bitcoin could quickly shoot toward $115K or even $120K as forced buying adds to bullish momentum. However, traders should remain cautious—these moves often come with sharp reversals.

Read Also :

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  • Bitcoin’s Diagonal Trendline: A Crucial Turning Point
  • MoonBull Whitelist Stamps Its Hooves Toward 100x Crypto Gains – While Pudgy Penguins and Ponke Struggle to Keep Pace
  • $123M Australian Crypto Scam Exploits Licensed Firm
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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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