Liquidity builds for explosive Bitcoin price action
Bitcoin is setting the stage for a massive short squeeze as exchange order books fill with liquidity just above current prices. Traders are increasingly betting against BTC, but signs point to an imminent reversal that could catch short sellers off guard.
After briefly dipping to around $117,200, Bitcoin swiftly rebounded to $118,604 on Thursday. This move has fueled speculation that BTC could surge toward the $120,000 mark as part of a high-impact short squeeze.
Exchange data reveals liquidity magnet forming
According to CoinGlass, liquidity is now building significantly above the current spot price, a pattern that often acts like a magnet for sudden price spikes. Wednesday’s dip below $118,000 served to clear long positions and reset the playing field, but now attention is turning to shorts that may soon be caught offside.
“Bitcoin liquidity is piling up on the topside,” said trader Mister Crypto on X. “A massive short squeeze is inevitable!”
Crypto Rover echoed this sentiment, calling the squeeze setup “obvious” as sell orders mount near resistance levels.
Key BTC price levels to watch: $115K and $120K
Trader Daan Crypto Trades highlighted the importance of watching the $115,000 and $120,000 price zones.
“BTC is still stuck within this range,” he said. “Lots of positions on both sides now. Eyes on those liquidity clusters below $115K & $120K. I’d assume price wants to take both of those out at some point.”
These clusters suggest Bitcoin could whip in either direction before deciding on a more permanent trend — a classic setup for a high-volatility squeeze event.
Bitcoin dominance climbs as altcoins lose momentum
As Bitcoin price consolidates, it’s quietly reclaiming control of the crypto market. BTC dominance rose 0.5% on the day, bouncing back toward 62%, signaling stronger capital rotation from altcoins into Bitcoin.
Analyst Rekt Capital noted that despite altcoins showing signs of weakness, Bitcoin remains structurally sound.
“The altcoin market is reacting as if Bitcoin has broken down from its range — but it hasn’t,” he explained. “In fact, it’s retesting the Lower High and Range Low as support. The retest is in progress.”
Bitcoin market setup favors bulls
As liquidity continues to pool above the spot price and short interest grows, the market is primed for a violent upside move. With BTC dominance rising and altcoins faltering, the path of least resistance appears to be up.
The question now is not if a short squeeze will happen, but when.
