- Bitcoin tumbled to $112,000, sparking panic selling and the largest liquidation event of 2025.
- Long traders suffered losses exceeding $1.6 billion as leveraged bets unraveled in hours.
- Analysts now focus on $114,000 resistance and $110,500 support as key short-term price levels.
Bitcoin recently went through one of its wildest price swings this year, dropping sharply below key price levels and shaking the entire crypto market. After failing to consolidate near last week’s $116,500 price mark, BTC slipped further down to $112,000 before stabilizing briefly within the $113,000 zone. The sudden retracement has caused a stir among top investors, followed by a massive $1.7 billion liquidation in a single day.
This event has greatly affected long-term traders who were confident in prices going higher. When Bitcoin broke below $114,000, automatic sell orders kicked in, forcing even more sales and speeding up the crash. By the end of the day, the global crypto market price has dipped to about $77 billion, showing just how quickly digital assets can react when prices shift suddenly.
Panic Selling Has Put Bitcoin’s Short-Term Technical Outlook Under Pressure and Traders Remain Cautious
From a technical standpoint, Bitcoin is caught in a tug of war between resistance and support, with the immediate ceiling sitting near $114,000 and the next key zone at $115,000. Analysts suggest that a close above these thresholds could reestablish momentum and pave the way for retests of $116,500 and eventually $117,250. However, failure to reclaim these levels quickly risks another downward leg, with support now eyed at $112,000, $111,250, and potentially as low as $110,500.
Indicators have painted a grim short-term picture. According to on-chain data, short-term holders have begun realizing losses, a sign of panic-driven exits. Technical charts also show resistance forming along a bearish trend line, making recovery harder without strong buyer interest. For many traders, this episode feels like a reset, flushing out excess leverage and potentially setting up cleaner conditions for future moves.
Wider Crypto Market Suffers as Bitcoin Liquidations Ripple Across Exchanges and Derivatives Positions
The crash did not remain confined to Bitcoin alone, as the broader digital asset sector endured heavy collateral damage. Altcoins slipped in lockstep, with only a handful of tokens among the top 100 managing to remain positive on the day. Derivatives markets were hit particularly hard, with open interest collapsing by around $2 billion, signaling that speculative bets had been wiped out across major platforms.
The sheer size of the liquidation event underlines how heavily leveraged optimism had become in recent weeks. Traders who expected Bitcoin to break past $117,000 found themselves caught off guard as sudden downward momentum erased gains and inflicted steep losses. While painful for many participants, some analysts view such episodes as healthy corrections that prevent speculative excess from building unchecked.
Interestingly, traditional markets are not reflecting the same degree of strain. The S&P 500 has held firm, rising slightly to hover above 6,690 points, suggesting that the current stress remains concentrated in crypto assets.
For Bitcoin, this decoupling may serve as both a risk and an opportunity, as it highlights the asset’s independence but also its vulnerability to speculative flows.
Bitcoin Remains in a Consolidation Phase With Traders Closely Watching the Federal Reserve
Despite market uncertainties, Bitcoin still managed to trade in a fairly steady range in contrast to its behavior last year. Just last week, BTC consolidated around $116,795, slightly below its record level, showing that the resilience is there despite short-term fluctuations.
Moreover, if Bitcoin manages to edge past the $117,000 and $118,000 resistance zone, a possible breakout will be on the horizon. But if it continues to struggle, the price might be stuck where it is. In addition to the uncertainty, the impending Federal Reserve decision on interest rates will significantly impact BTC’s price along with the global market, with traders closely monitoring the situation.
For now, people are watching closely to see if Bitcoin can stay above $113,000 or whether it might slip lower depending on investor mood and the Fed’s message.
