As Bitcoin (BTC) continues its bullish momentum, traders who have placed short bets against the cryptocurrency are facing significant risks of liquidation. Bitcoin recently surged to $97,500, just shy of a critical resistance point at $100,000, and a large number of short positions are at risk of being liquidated if the price continues its upward trajectory.

Bitcoin’s surge above the $96,000 mark has set the stage for a potential “short squeeze,” which could see massive liquidations for traders betting against the asset. According to data from Coinglass, there is a concentration of short positions across major exchanges like Bybit, OKX, and Binance, with over $3 billion worth of Bitcoin shorts vulnerable to liquidation if the price surpasses the $100,000 level.

Bitcoin Shorts at Risk of Liquidation

Short positions refer to trades where investors bet on the price of an asset going down. In a short trade, the trader borrows an asset and sells it, hoping to repurchase it later at a lower price. If the price rises instead of falling, the trader is forced to repurchase the asset at a higher price, potentially incurring significant losses. A short squeeze happens when the price rises quickly, forcing short sellers to cover their positions, which leads to even more upward pressure on the price.

According to Coinglass’s liquidation heatmap, there is a substantial cluster of short positions concentrated between $97,000 and $100,000. If Bitcoin continues to rise, the short positions in this price range could trigger a cascade of liquidations. As the price crosses these levels, the cumulative short liquidation leverage is rapidly trending toward $4 billion, which means leveraged traders betting against Bitcoin are increasingly exposed to major losses.

At the $100,000 level, Bitcoin’s short positions would face liquidation losses of around $3.04 billion, and should the price rise to $105,000, this figure could climb to approximately $3.73 billion. Furthermore, if Bitcoin reaches new all-time highs near $109,000, the liquidation risk could approach $4 billion.

This increasing pressure on short sellers is a key factor contributing to the potential for further price rallies. The short squeeze could provide additional fuel for Bitcoin’s bullish momentum, pushing the price even higher in the coming days and weeks.

Bitcoin’s Resistance Zone and Market Setup

At present, Bitcoin is trading within one of its largest resistance zones, a critical level that traders are closely monitoring. According to data from IntoTheBlock, the $96,000 to $98,000 price range has seen significant accumulation from 1.06 million addresses that together acquired about 750,800 BTC, amounting to roughly $73 billion. This makes the $96K-$98K zone Bitcoin’s largest supply zone, which suggests that a breakthrough past this level could lead to a sharp upward movement, with minimal resistance to further gains.

Once Bitcoin breaches this critical level, traders expect the next significant barrier to be around $100,000. Should the price rise above the $100K level, it could trigger the much-anticipated short squeeze, driving prices further toward six-figure levels.

However, if Bitcoin struggles to break past this resistance and fails to gather enough momentum, the price could experience a retracement. In this case, support could emerge around the $93,000 and $82,000 levels. These areas are significant because strong buying pressure has historically reappeared in these zones, and they could provide a solid foundation for a rebound if Bitcoin faces a pullback.

Bitcoin’s Road to $100K and Beyond

The current market conditions make the $100,000 psychological barrier a key milestone for Bitcoin. Many traders and analysts are closely watching how the price performs once it reaches this level. A breakout above $100K could mark the beginning of a major rally, potentially sending Bitcoin to new all-time highs and triggering a wave of market participation.

In fact, some market watchers, including prominent trader Peter Brandt, have suggested that Bitcoin could rally to between $120,000 and $150,000 within the next four months. Brandt believes that if Bitcoin manages to reach these levels, it could fuel the start of a new bear market cycle, as traders would begin to take profits after such a significant rally.

However, for now, the focus remains on Bitcoin’s ability to breach the $100K resistance. With short positions at risk of liquidation and significant accumulation near the $96K-$98K range, the stage is set for potential price movements that could push Bitcoin to new heights in the near term.

Conclusion

Bitcoin’s current price action and the looming $3 billion worth of short liquidations present an exciting setup for the cryptocurrency market. If Bitcoin manages to break past its critical resistance zones and continue its bullish trend, it could trigger a short squeeze, sending the price beyond the $100K mark and potentially fueling further bullish momentum. However, traders should remain cautious, as any failure to break through resistance could lead to a pullback and create new opportunities for buying at lower levels.

With the cryptocurrency market in a dynamic phase, Bitcoin’s next move will be closely watched, with traders eagerly anticipating whether the digital asset can sustain its bullish momentum and reach new all-time highs.