u.today
Bitcoin is currently in the middle of what appears to be a short squeeze.
The price of the leading cryptocurrency by market cap recently spiked above the $95,000 level on the Bitstamp exchange.
However, the top coin has so far struggled to reclaim $96,000, which shows that the bulls are not out of the woods just yet.
According to data provided by CoinGecko, Bitcoin is still down roughly 25% from its record high.
Massive liquidations
CoinGlass data shows roughly $591 million worth of short positions has been liquidated over the past 24 hours alone.
Binance, the leading exchange, accounts for nearly half of all liquidations.
The key catalyst
The recent price spike was likely triggered by fresh U.S. inflation data.
Investors initially reacted with optimism to the slightly cooler-than-expected core figure, but this initial excitement quickly faded.
Major indices like the S&P 500 initially pushed higher before wiping out those gains later in the session. The rally stalled as investors realized the 2.7% print would not likely push the Fed to cut rates sooner than mid-2026.
The figure remains above the Federal Reserve’s 2% target.
The Federal Reserve is overwhelmingly expected to keep interest rates steady at its next meeting on Jan. 28.
Economists suggest the Fed will remain in "wait and see" mode for the next few meetings to ensure disinflation is sustained.