Bitcoin Reclaims $80K as $468M in Short Liquidations Fuel Recovery: Is a New High Next?

Bitcoin regained the $80,000 level on Wednesday, November 4, marking its first daily close above that threshold since the October 29 Binance hack. The recovery triggered a massive short squeeze, forcing traders to close approximately $468.5 million in bearish positions.

The rally accelerated after U.S. stock markets opened, pushing Bitcoin higher as leveraged short sellers rushed to exit their positions. BTC is trading around $80,550, gaining 2.7% over the past 24 hours. Ethereum outperformed the largest cryptocurrency, climbing 4.4% to approximately $2,427.

Bitcoin’s recovery unfolded in two rapid moves. BTC climbed from $78,321 at 14:30 UTC, when trading began in New York, to $79,559 within 15 minutes. The rally continued, taking the price to $81,196 by 15:15 UTC. Earlier in the session, Bitcoin had dropped to $75,736, resulting in an intraday trading range exceeding 7%.

Most of the liquidated traders had positioned themselves for further downside. However, rallies driven primarily by forced short covering can lose momentum once those positions have been closed and the resulting buying pressure disappears.

How Significant Was Bitcoin’s Short Squeeze?

According to CoinGlass, cryptocurrency futures liquidations reached $715.6 million over 24 hours. Short positions accounted for 65.5% of the total, representing approximately $468.5 million in forced closures. Around 99,879 traders were liquidated during the period.

Bitcoin recorded the largest share of liquidations, with approximately $267.1 million in positions wiped out. Short sellers accounted for 93.4% of Bitcoin’s liquidations. Ethereum followed with $197.5 million in liquidations, of which 58.1% involved bearish positions. Binance processed approximately 39.3% of all liquidations across the market.

The largest individual liquidation involved a $38 million Ethereum long position that was closed on HTX at $2,429.33, close to ETH’s current trading level.

Meanwhile, Bitcoin futures open interest on OKX increased to $3.88 billion during the rally before declining to $3.74 billion by midnight UTC. The subsequent reduction suggests that traders were closing existing positions rather than establishing substantial new exposure.

Despite Bitcoin’s recovery, derivatives traders have not fully shifted toward a bullish outlook. The OKX ratio of accounts holding long BTC positions to those holding shorts declined from 1.84 at 11:00 UTC on Wednesday to 1.52 on Thursday morning. This indicates that bearish positioning has become relatively more prominent despite the price rebound.

Bitcoin Price Analysis: Can BTC Hold Above $80,000?

Bitcoin is currently trading close to its 20-day exponential moving average (EMA) at $80,006 and its 50-day EMA at $80,166. This places the $80,000 region at an important technical level, serving as both a psychological price threshold and an initial support zone.

The next significant resistance lies around $81,971, the level where Bitcoin was trading before reports of the October 29 Binance hack triggered a sharp market decline. A sustained move above this price would effectively erase the losses associated with the hack from Bitcoin’s price chart.

Options markets, meanwhile, are showing relatively limited concern about another major volatility spike. Deribit’s DVOL index, which measures expected Bitcoin volatility over the next 30 days, declined to 36.9 from 38 on Wednesday.

The next important signal for Bitcoin will be whether spot market buyers maintain demand after the short-covering rally loses momentum. Continued buying could help BTC defend the $80,000 threshold and challenge its pre-hack trading level.

However, if fresh spot demand fails to emerge, the latest recovery could prove to be a temporary short squeeze rather than the beginning of a sustained bullish breakout.

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