Contract Liquidations Peak at $397M, Then Fall to $261M
Coinglass data shows crypto contract liquidations first spiked to $397 million in a 24-hour period before easing to $261 million in a subsequent day. Short liquidations dominated both reports, accounting for about 81% and 73% of totals. Bitcoin (BTC) saw forced closures of $52.36 million at peak and $29.03 million later, while Ethereum (ETH) recorded $169 million and $115 million in liquidations respectively. The prevalence of short liquidations suggests rapid price rebounds that caught bearish traders off guard. Traders should monitor open interest and leverage levels and adjust risk management to avoid further margin calls and forced liquidations.
Bullish
Heavy short liquidations reflect rapid price rebounds, a classic bullish signal in derivatives markets. While long positions also faced forced closures, short squeezes dominated, suggesting traders were caught off guard by upward swings. In the short term, this dynamic may fuel further buying pressure as shorts cover positions. Long term, heightened volatility underscores the need for disciplined risk management but does not negate an overall bullish sentiment if demand for BTC and ETH remains strong.