As the new week began, the crypto markets experienced one of their sharpest sell-offs of the year. Bitcoin plunged to $115,000, sparking a wave of liquidations unseen since the spring rally. According to market data, over $126 million in leveraged positions evaporated within just a few hours, with long traders bearing the brunt of cascading stop-outs and margin calls (source 1).
Heightened Leverage Exposes Trader Vulnerabilities
The catalyst for this correction was a combination of profit-taking at multi-month highs and mounting macroeconomic pressure. Analysts observed record inflows into leveraged long positions last week as traders chased the breakout above $120,000. But once BTC lost support near $118,000, forced liquidations accelerated, quickly erasing recent gains as confidence crumbled (source 2). In total, the market lost more than $100 billion in value within a 24-hour window as Ethereum and major altcoins echoed Bitcoin's slide.
Broader Market Weakness and Momentum Shift
The sell-off was further aggravated by a stronger US dollar and renewed uncertainty over Federal Reserve policy. Bitcoin ETF outflows underscored institutional caution, contributing to the rapid collapse of support levels. Technical analysts noted the breakdown of a rising wedge pattern on the BTC daily chart, a classic harbinger of intensified bearish moves (source 3). Some experts, like Jacob King of WhaleWire, warned that the market remains dangerously overleveraged, leaving traders exposed to even deeper liquidations if sentiment fails to recover (source 4).
Key Support Levels and the Path Ahead for Bitcoin
With Bitcoin currently holding near $115,000, all eyes are on the $112,000 support zone. A decisive break below could trigger a further liquidation cascade, testing deeper support levels around $105,000. However, seasoned market participants note that this pullback—while painful for over-leveraged traders—may provide the healthy consolidation required for a sustained uptrend heading into the year’s end. For advanced investors, these conditions call for careful risk management as volatility remains high and liquidity pockets grow thin (source 5).
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