Bitcoin traded near $77,733 at midday in Hong Kong, according to CoinDesk data, little changed over the past 24 hours, after falling as low as $76,685 and failing to hold above $78,000 in US trading hours.
Derivatives positioning suggested that the recent sell-off may have been more of a leveraged flush than the start of a broader market collapse. Open interest, a measure of outstanding leveraged futures positions, held relatively steady while funding rates remained low or negative, a sign that traders were not aggressively piling into bullish bets before the decline.
“There was no massive build-up of leveraged longs prior to this, which means most of those liquidated in this fall were leveraged funds attempting short-term bottom fishing. Second, this signals that we are not in the midst of a structural trend reversal down. The temporary bottom of $75,000-$77,000 remains well-defined,” said Ha Sunsh, senior researcher at TimDesk.
The biggest problem, he said, is macro: Investors are reducing risk as long-term interest rates rise, oil and inflation risks remain in focus, and there is “currently no compelling reason for new capital to enter the market.”
CoinGlass data showed $200 million in crypto liquidations over the past 24 hours, split almost equally between long and short positions, suggesting the move was less a one-sided capitulation than a volatile market whipping both ways.
Sun pointed to the US 30-year Treasury yield, which recently shot above 5%, as the main pressure. Higher long-term returns tend to weigh on speculative assets by raising the opportunity cost of holding non-yielding assets like bitcoin while tightening broader financial conditions.
The next catalyst may come from geopolitics.
Sun said a meaningful de-escalation in US-Iran tensions could cool oil prices and inflation expectations, easing pressure on yields and giving bitcoin room to rise.
But if interest rates remain high and geopolitical risks persist, bitcoin could remain stuck in what he described as a defensive, range-bound market, with the $75,000 to $77,000 zone serving as the key support level in the near term.
