Bitcoin fell to around $108,000 on Wednesday, before zooming above $110,000 on Thursday after a volatile session that saw around $817 million in leveraged futures liquid, with long traders taking most of the losses.
The pullback came just hours after the Federal Reserve delivered a widely expected 25-basis-point rate cut, only for chair Jerome Powell to dampen optimism with cautious comments suggesting a December cut was not guaranteed.
Liquidations occur when traders using borrowed funds are forced to close their positions because their margin falls below required levels. In crypto futures exchanges, this process is automated, as when prices move against a leveraged trade, the platform sells the position in the open market to cover losses.
Large clusters of long breakouts can signal capitulation and potential short-term bottoms, while heavy short wipeouts can precede local tops as momentum flips. Traders can also track where liquidation levels are concentrated, helping to identify zones of forced activity that may act as nearby support or resistance.
Data from Coinglass showed roughly 165,000 traders were liquid in 24 hours, including an $11 million BTCUSD long on bybit, the single biggest hit of the day. Hyperliquid led all areas with $282 million in liquids, followed by Bybit’s $223 million and Binance’s $144 million, underscoring how overextended leverage remains in the market.
“While the Fed cut interest rates as expected, Chair Powell’s cautious meeting triggered a sharp sell-off in a ‘Sell-the-News’ event after saying that the expected December cut was not guaranteed,” said Nick Ruck, director at LVRG Research in a note to Coindesk. “
“As short-term volatility continues, the Fed’s pivot to ending quantitative easing in December signals a bullish undercurrent for risk assets like crypto, positioning bitcoin and ethereum for renewed upside as cheaper capital flows in the coming months,” added Ruck.
Meanwhile, Jeff Mei, COO at BTSE, said the dip reflected “careful positioning in all markets.”
“Inflation remains above the target at 3%, and the Fed has limited room to maneuver until there is clearer data amid the government shutdown,” Mei said. “With asset prices elevated, further easing is unlikely unless economic weakness becomes more apparent.”
The wave of liquidations came as investors digested improving geopolitical sentiment after the US and China signed signals toward a new trade deal.
Despite near-term volatility, analysts said macro conditions were more favorable. If liquidity expands in line with the Fed’s timeline, Bitcoin could find firmer footing above $115,000 in November — assuming traders don’t get caught leaning again.
