The rapid swings in price triggered a liquidation event in the futures market, with over $138 million in long and short positions vaporized in just a few hours.
The session highlights the fact that Bitcoin is still very much tied to its liquidity and hit-you-in-the-face resistance levels, like, for instance, the one it just on the other side of $12,000. And when sentiment dips below key liquidity thresholds, you know what happens, don’t you? You can feel it in your bones.
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As per the information provided by Coinglass, the rally and the following retracement of Bitcoin today caused a major disturbance within the derivatives market. Positions worth a total of $138 million were wiped clean, and the ones that got hit the hardest were the short sellers.
Of the total liquidations:
A market ruled by leveraged trades and momentum-driven strategies dominates a rapid-lubrication pace. What we see in crypto trading is not too different from what we might expect during a fire sale in a very illiquid stock or bond. While events of this sort are not too unusual in the crypto space, the sheer size and swiftness of today’s downsizing serves to remind us of the inherent risks in trading under such conditions.
Bitcoin’s intraday high fell short of a critical resistance level at $106.6K, which has become a significant supply zone, stopping just short of a key resistance level at $106.6K, which has emerged as a significant supply zone. On-chain data indicates that approximately 31,000 BTC were picked up at or near this price point on December 16, 2024, and that a large concentration of unspent coins now exist with this cost basis.
#BTC's price surge stalled just below $106.6K – a level with 31K $BTC held at that cost basis. This supply cluster originated on Dec 16 and remains unshaken. Holders haven’t redistributed, nor averaged down – making $106.6K an important level to watch in the short term. pic.twitter.com/f7rXqtP6qD
— glassnode (@glassnode) May 19, 2025
The particular significance of this level is that these coins have not been redistributed or averaged down since their acquisition. The holders of this large tranche have remained inactive, which may signal either strong resolve or strategic patience. As a result, $106.6K is now being closely watched as a critical short-term barrier. A decisive break above could signal renewed bullish momentum, while repeated rejections may spark deeper corrections.
The unwillingness of this group to shift their assets indicates that a sizable number of market players are treating the current pricing level as a decision point. They’re either waiting for confirmation of a breakout before fully committing or getting ready to go the other way if we get rejected at this level.
Bitcoin’s short-term relationship with gold has turned negative, to put it mildly. Over the last month, the correlation between the two assets plunged to -0.54, the lowest level seen since February 2022. This negative movement suggests that gold and Bitcoin are not telling the same story any longer. If anything, it implies that Bitcoin’s current narrative is more about “crypto stuff” and less about the traditional safe-haven narrative that gold has habitually followed.
Still, the partial correlations over the medium and long terms stay in place. The 90-day correlation is 0.39, and the 365-day correlation is a sturdy 0.60. It indicates that, when looked at over the horizon of a year, the price of Bitcoin still to a material extent tracks the price of gold.
#Bitcoin's short-term correlation to gold has dropped to -0.54 over the past 30 days – the lowest since February. Meanwhile, 90D and 365D correlations remain positive at 0.39 and 0.60, respectively. pic.twitter.com/GDoN8DwQfA
— glassnode (@glassnode) May 19, 2025
In the short term, this divergence could stem from heightened speculation and leverage within cryptocurrency markets. Distinct narratives, whether they be related to ETF inflows, technological advancements, or digital assets’ unique geopolitical context, might also be playing a role.
With BTC around $105,220, the traders and investors who follow it are anticipating that increased volatility is on the way in the next few days. The main level of resistance BTC is looking to bust through is $106.6K. There are a couple of reasons why this level is tough for BTC to get past, but if it does get past it, there isn’t a lot holding it back from going to new all-time highs.
Conversely, if Bitcoin cannot keep the uptick intact, it could slide back toward the $103K level — a price it grazed earlier in the day. The potential for a downturn seems to have market participants on edge, watching for any sign from futures, on-chain indicators, or the broader macro environment that could give them a handle on where things are headed in the immediate term.
At present, Bitcoin remains a prime example of unpredictability—a state of being that carries equal parts risk and reward. As it transitions from one stage of its 2025 crypto cycle into another, this much is clear: It is still the most talked-about cryptocurrency.
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.
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