Record Squeeze Drives Bitcoin Price Rally, But $83K Resistance Looms

Key Takeaways

• Glassnode says a historic spike in short liquidations on Aug. 19, ignited bitcoin’s rally past $80,000.
• Bears lost $1.74B on Aug. 19 as U.S. spot Bitcoin ETFs later absorbed over $2.2B in weekly net inflows.
• Analysts expect 1.05M BTC held between $83,000 and $86,000 to present a major supply test for bitcoin.

Record Squeeze Triggers Price Rebound

The massive wave of short liquidations on Aug. 19 served as the primary catalyst for bitcoin’s rapid price rebound, according to blockchain analytics firm Glassnode. In its latest market report, Glassnode said the event recorded the single largest volume of single-day short liquidations in its data feed since tracking began in 2019.

During the squeeze window, short positions accounted for roughly 85% of all forced position closures across major centralized exchanges. The liquidation cascade began when bitcoin rapidly surged past key resistance levels, forcing bearish traders to cover their leveraged positions, Glassnode explained.

According to Glassnode’s liquidation heatmaps, an asymmetrical buildup of short leverage had been accumulating for up to 10 days before the breakout. As bitcoin broke upward, pending stop-loss orders and forced exchange closures acted as mechanical buy pressure, accelerating the rally toward the $80,000 threshold.