Bitcoin Hits 2-Month High as $100M in Short Positions Liquidated Around the Market

Bitcoin soared over $28,000 for the first time since August 17 in a surprising move Sunday evening.

BTC swiftly added $800 in a sudden spike around 6:30 pm ET, bouncing off its resistance around $27,200, CoinGecko data shows.

It was last trading 4.4% higher since yesterday at $28,271.

The bullish move liquidated positions worth $47.4 million in the futures market, per CoinGlass data, $42.9 million or 90% of which were in short orders, pointing to the potential reason behind the pump.

The price spike coincided with the short liquidations, indicating that the move may have been driven by a short squeeze in the futures market.

The only chart you need in order to understand the recent pump 🙂$BTC pic.twitter.com/V8FXBFR7nu

— Coinalyze (@coinalyzetool) October 2, 2023

A short squeeze is when the price of an asset rises quickly as existing short order holders, who bet against the market with leverage, are forced to buy an asset at higher prices as its price rises.

Ethereum (ETH) also followed the top crypto, rising above $1,700 for the first time in five weeks. Futures orders worth $28 million were liquidated due to ETH’s price surge.

The combined market cap of crypto tokens rose by 3.3%, adding close to $37 billion over the last 24 hours to reach $1.16 trillion.

The positive spike in crypto prices liquidated $114.9 million across the crypto market, with shorts amounting to $97.8 million or over 85% of the total, per CoinGlass data.

Solana (SOL) futures recorded the third highest liquidation after the majors with liquidations worth $5.92 million.

SOL also led the niche market’s gains among the top 100 crypto tokens by market cap with 13.5% overnight gains.

Besides Solana, the top gainers over the last 24 hours included Thorchain (RUNE), Bitcoin SV (BSV), and Render (RNDR) tokens.

Spooky season spurs crypto bulls

In addition to futures liquidations, the U.S. government's successful effort to avert a shutdown by extending its funding for 45 days may have also contributed to the positive sentiments in global markets.

The U.S. stock market futures opened in the green on October 2 with the S&P 500 gaining 17.5 points to trade at 4,312.4 points.

The tech-heavy Nasdaq index also opened with a positive gap of 0.7% above Friday’s closing, tapping into the 15,000 level.

VanEck is also preparing to launch the first futures Ethereum ETF today, adding to the positive sentiments.

Over the past decade, Bitcoin's price has surged in October every year except for the bear markets of 2014 and 2018, per CoinGlass data.