Important points
- If Bitcoin reaches $95,076, $1.2 billion of leveraged short positions could be liquidated.
- Forced purchases due to short-term liquidations could push Bitcoin prices even higher.
According to Coinglass' liquidation map, $1.2 billion of leveraged short positions are at risk of liquidation if Bitcoin rises to $95,076.
The potential liquidation highlights the amount of bearish bets currently being made against the largest digital asset by market capitalization. A short position involves a trader selling Bitcoin in order to borrow Bitcoin, betting that the price will fall, then buying back Bitcoin at a lower price and profiting from the difference.
Liquidation occurs when a trader's position is automatically closed by the exchange due to insufficient collateral to sustain the leveraged bet. A rise to $95,076 could trigger forced buying as these short positions are liquidated, accelerating the price's upward momentum.
According to CoinGecko, Bitcoin is at $91,895 at the time of writing, retreating from a move above $94,000 before the FOMC decision.
