Bullish positions hanging by a thread: Market risks revealed by Bitcoin liquidation charts

Bitcoin is currently priced at $93,584, but the real market risk may be hidden at two key price points. According to the latest news, if BTC falls below $92,000, the liquidation strength of long positions on mainstream CEXs will reach $1.135 billion; conversely, if it breaks above $95,000, the short liquidation strength will be $678 million. Behind these figures reflects the fragile balance between bullish and bearish forces in the current market.

What does liquidation strength mean?

First, it’s important to understand the concept of “liquidation strength.” According to Coinglass, the liquidation chart does not display the exact number or value of contracts pending liquidation but shows the relative importance of each cluster of liquidations compared to nearby clusters. Simply put, higher liquidation bars indicate that when the price reaches that level, the response caused by liquidity waves will be stronger.

This is not a linear relationship. Higher liquidation bars mean more traders have set stop-losses or been forced to close positions at that level, and once the price hits it, a chain reaction can occur: stop-loss orders trigger en masse, selling pressure surges, pushing the price down further, which triggers more liquidations. This phenomenon is often referred to as a “liquidity wave” in the market.

Comparing liquidation pressures of bulls and bears

The data reveals a clear asymmetry. The liquidation strength of longs is significantly greater than that of shorts, which implies:

• Long positions face greater risk exposure, with liquidation pressure concentrated below $92,000
• Shorts have a relatively weaker defense line, and breaking above $95,000 could trigger short liquidations
• The current price is between these two levels, representing a relatively balanced but unstable position

The dual nature of market risk

Downside risk

If BTC drops below $92,000, the $1.135 billion long liquidation strength could create a “death spiral.” Such a scale of liquidation would attract more traders to close positions and cut losses, potentially causing a rapid price decline. Recent information shows that 567 BTC have been transferred to Coinbase institutional wallets, a large transfer often indicating institutional position adjustments.

Upside risk

Conversely, if Bitcoin can break above $95,000, the $678 million short liquidation strength will be triggered. Although this figure is smaller than the long liquidation strength, it can still accelerate upward movement.

The current fragile market balance

From the news background, Bitcoin has risen 6.52% over the past 7 days, with a 24-hour increase of 0.78%, indicating an overall upward trend. However, this rise is built on thin ice. The long liquidation strength far exceeds that of shorts, suggesting that while bearish forces are weaker, bullish leverage positions are relatively heavy.

This structure is often referred to in markets as “long-term accumulation risk.” Traders have built large long positions at high levels, and once negative news or technical breakdowns occur, chain reactions of liquidations are likely to be triggered.

Key points to watch moving forward

• Can $92,000 hold? This is the last line of defense for bulls. If it breaks, the next support level may need to be lower.
• The difficulty of breaking above $95,000: even if prices rise, short liquidations at this level may not support a sustained upward move.
• Institutional fund flows: large inflows and outflows often signal market direction changes.

Summary

The Bitcoin liquidation chart shows a market pattern where longs are slightly dominant but risk is concentrated. The $1.135 billion long liquidation strength is the biggest current risk point, while the $678 million short liquidation strength is relatively weaker. This asymmetry indicates that downside risk warrants more caution. The current price range between $92,000 and $95,000 is neither safe nor stable. For traders, it’s crucial to recognize the importance of these two levels and manage risks accordingly. The next market move largely depends on whether the $92,000 support can hold.