BTC is caught between two liquidation levels: falling below $86,546 or breaking above $95,194 will trigger massive liquidations.

According to the latest news, Bitcoin is currently in a delicate position. If BTC falls below $86,546, the cumulative long liquidation strength on mainstream CEXs will reach $1.867 billion; conversely, if BTC breaks above $95,194, the cumulative short liquidation strength on mainstream CEXs will reach $1.666 billion. Currently, BTC is trading around $91,011, with only a few thousand dollars of space to either of these key levels, and the market is waiting in this “sandwich” position for a clear direction.

The Key Significance of Liquidation Levels

What is liquidation strength

Liquidation strength is not an exact count of contracts pending liquidation but rather a measure of the importance of each liquidation price relative to nearby liquidation levels. Higher liquidation bars indicate that when the price reaches that level, liquidity waves will trigger a stronger market reaction. Simply put, these two levels are “trigger points”—once touched, they will trigger large-scale chain liquidations.

The “danger zone” at the current price

Bitcoin at $91,011 is positioned relative to the two key levels:

• About $4,465 below at $86,546 (a 4.9% drop triggers)
• About $4,183 above at $95,194 (a 4.6% rise triggers)

This symmetrical distance is quite interesting—both bulls and bears face similar risk exposures.

Market Sentiment Signals

Based on the latest data, several noteworthy signals are being released:

• Funding rate turning bearish: Funding rates on mainstream CEXs and DEXs show the market leaning towards bearishness, indicating accumulating short pressure
• Coinbase premium index turning negative: From a positive premium (0.011%) back to a negative premium (-0.0277%), reflecting increased selling pressure in the US market, possibly with institutional funds cautiously observing
• Recent liquidation activity: In the past 24 hours, total liquidations across the network reached $447 million, with longs liquidated at $286 million and shorts at $161 million, indicating high market volatility

Market Implications of the Two Liquidation Levels

Long liquidation wave below $86,546

If BTC drops below this level, $1.867 billion worth of long positions will face forced liquidation. Such a large liquidation could further accelerate the downward momentum, potentially causing a “waterfall” decline. Considering the current bearish funding rate, longs are already struggling to defend.

Short liquidation wave above $95,194

Conversely, if BTC breaks above this level, $1.666 billion worth of short positions will be liquidated. This could trigger stop-loss buy orders from shorts, creating upward momentum. However, market sentiment suggests shorts are more confident, making a breakout above this level potentially more difficult.

Key Observations

Historical data from the news indicates that in recent days, BTC has repeatedly oscillated around these liquidation levels. On January 6, the market tested the $92,000–$95,000 range multiple times but ultimately failed to break through. Such repeated probing usually means both sides are accumulating strength.

Currently, market sentiment leans bearish, but the liquidation strength data shows that the amount of long liquidations ($1.867 billion) below is greater than short liquidations ($1.666 billion) above. This could imply that if a sharp drop occurs, market reactions might be more intense than on upward breakouts.

Short-term Outlook

Based on current data, the most likely scenarios for Bitcoin are:

1. Consolidation: Continue oscillating within the $91,000–$94,000 range, waiting for clearer signals
2. Downward testing: Gradually decline to test support at $86,546, with potential rebounds along the way
3. Upward breakout: If breaking above $94,000, the next target is $95,194, and surpassing this could open further upside

Market sentiment suggests that downside risk seems more acknowledged (funding rates bearish, premium index negative), but the liquidation data indicates that the downward risk might be more severe.

Summary

Bitcoin is currently in a highly symmetrical risk position, with two key liquidation levels corresponding to $1.867 billion in long liquidations and $1.666 billion in short liquidations. Market sentiment is leaning bearish, but this does not mean a downward move is certain—liquidation strength data actually shows that the downward risk could be more intense.

For traders, it’s crucial to recognize the importance of these two levels. Whether breaking upward or downward, large-scale chain liquidations are likely to be triggered, potentially causing rapid price swings. In such conditions, strict risk management and position control are especially important. In the short term, monitoring the performance around $86,546 and $95,194 will be key to understanding BTC’s subsequent moves.