Bitcoin Surges Past $91K, Liquidating $300M in Short Positions

The cryptocurrency market’s notorious volatility returned with a vengeance at the start of December, but this time propelling prices sharply higher. After plunging to under $84,000, Bitcoin embarked on a rapid ascent, breaching the $91,000 mark and putting it on track for its most significant single-day percentage increase in over six months. According to analysts at The Kobeissi Letter, this price action is emblematic of mechanical market forces. They emphasized that the swings have “nothing to do with the industry’s fundamentals, which remain solid,” suggesting the moves are primarily a function of leveraged trading and positioning rather than a reflection of changing crypto asset valuations.

The scale of the reversal is starkly visible on 24-hour charts. Bitcoin’s 7% surge was actually outpaced by several major altcoins, highlighting a broad-based recovery. Ethereum posted a 9% gain to reclaim the psychologically significant $3,000 level. Solana skyrocketed by 12%, while XRP added over 7%. The standout performer among larger-cap alternative cryptocurrencies was Cardano (ADA), which surged by an impressive 15% to trade at $0.43. This coordinated rally indicates a resurgence of risk appetite across the digital asset spectrum following the previous day’s sell-off.

This violent upward move proved catastrophic for over-leveraged traders, particularly those betting on further price declines. Data from CoinGlass reveals that the total value of liquidated positions soared to nearly $380 million during the rally. In a clear departure from the previous day’s dynamics, short sellers were overwhelmingly responsible for the carnage, accounting for more than $300 million of the total wrecked capital.

The liquidation data paints a vivid picture of the squeeze. In just one 60-minute window during the surge, approximately $140 million worth of short positions were liquidated, compared to a mere $3 million in long positions. Bitcoin shorts alone constituted over half of the entire liquidation amount, followed by Ethereum shorts at $91 million. The single largest liquidated position, valued at $13 million, occurred on the Bybit exchange. This data underscores how rapid, unexpected price movements can trigger a domino effect of forced selling, amplifying the initial move as automated systems close out leveraged bets.

Despite the chaotic price action, analyst sentiment, as reflected in the source commentary, remains conditionally bullish. The critical support level of $83,000, which was tested during yesterday’s crash, is now viewed as a key line in the sand. Maintaining a price above this zone is considered essential for sustaining the positive momentum.

Looking ahead, the immediate resistance point for Bitcoin is identified at $91,800—a level just inches above the current price at the time of reporting. A decisive break above this resistance is seen as the potential catalyst for the rally to resume in earnest. The analysis suggests that the market’s near-term trajectory hinges on these technical thresholds, with the mechanical forces of liquidations likely to continue playing a dominant role in driving volatility. The events of the past 24 hours serve as a potent reminder of the risks inherent in leveraged crypto trading, even during powerful bullish reversals.