Analysis: Bitcoin Holds Above $80K, Short Squeeze Drives Rebound, Bullish Sentiment Heats Up

Odaily reports: Bitcoin remained above $80,000 after Wednesday's rally, rising about 2.5% over the past 24 hours, with a slight pullback of 0.2% since midnight UTC to trade around $80,250. Ethereum fell 0.4% over the same period, while the CoinDesk 80 Index rose 0.9%.

Wednesday's market rebound was mainly boosted by falling oil prices and gains in U.S. stocks following the midterm elections. U.S. spot Bitcoin ETFs recorded net inflows of $74.6 million on Wednesday, ending three consecutive days of net outflows.

In derivatives markets, cryptocurrency futures liquidations rose 53% to $715 million over the past 24 hours, with about 65% coming from short liquidations. Bitcoin liquidations reached $267 million, of which approximately 93% were reverse short liquidations against long positions. Meanwhile, Bitcoin open interest grew only 0.3% while prices rose 2.6%, indicating that this rebound was primarily driven by forced unwinding of short positions rather than significant new long capital entering the market. Additionally, Bitcoin's one-week options skew dropped from about 11% the previous day to around 2%, signaling a notable decline in hedging demand against downside risk. (CoinDesk)