Bitcoin was finding it difficult to cross $35k for quite a while. But yesterday, Bitcoin bears were taken by a massive surprise as whales orchestrated a massive buying spree. And the $110M short squeeze propelled Bitcoin to $40k. Bitcoin rose by $4000 in just 15 minutes and this meteoric price increase and liquidated everyone who shorted at $40k. Even altcoins showed some relief as the prices increased after the rise.
Take a look at this tweet which shows data from GlassNode depicting the liquidations:
$111,000,000 of shorts liquidated in 10 minutes.
— Will Clemente (@WClementeIII) July 26, 2021
What is a short squeeze?
Short Squeeze is not something you will see very often. Even for Bitcoin, there have been very few instances when the price increased in such away. In a short squeeze, a very rapid price rise is seen, which results in the liquidations of a lot of short-sellers holding their positions. And as positions continue to get liquidated, the prices keep increasing and result in a huge green wick out of nowhere.
Does this mean we are back to a bullish market again?
To be honest, it is very difficult to say as there is a lot of manipulation in the market by whales. But yes, we can expect it to rise from here on. Bitcoin did clear the 200 daily EMA by a good margin but was not able to hold though and fell back again. This could be due to the huge number of shorts that were already waiting at that position. For Bitcoin to get completely bullish again, we need it to go above $42k and hold.
Another important addition to the mix is that Amazon will start accepting crypto on their platform. And if this happens, it could be even more bullish than Tesla announcing Bitcoin payments. Also, note that tomorrow is Tesla’s earnings day, and they might start accepting Bitcoin again, as Elon hinted in the B-word event. This is because BTC has moved quite significantly towards the use of renewable sources of energy.
What are your thoughts on the $110M short squeeze that pushed Bitcoin to nearly $40k? And do you think this is the beginning of the next phase of the bull run? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.