Bitcoin profit taking lingers, but rally to $115K will liquidate $7B shorts

2 weeks ago

Key takeaways:

Bitcoin could crook parabolic if prices determination supra $115,000 to liquidate much than $7 cardinal successful abbreviated positions.
Onchain indicators participate overheated territory, suggesting prolonged profit-taking from BTC investors.

Bitcoin (BTC) showed spot connected May 27, concisely tagging $110,700 aft a beardown US equities marketplace unfastened and the Trump Media and Technology Group’s announcement that it would rise $2.5 cardinal for a Bitcoin treasury.

Bitcoin’s bullish momentum aligns with the favorable US fiscal conditions, arsenic noted by Ecoinometrics. The macroeconomic-focused Bitcoin newsletter highlighted that the National Financial Conditions Index (NFCI) shows a accelerated displacement to ultra-loose territory aft a tightening signifier successful February 2025.

The NFCI, published by the Federal Reserve Bank of Chicago, tracks accent successful the fiscal strategy by aggregating measures similar recognition spreads, leverage, and backing conditions. When the scale moves into looser territory, it reflects easier entree to superior and reduced marketplace stress—conditions that typically promote risk-taking behaviour among investors.

For high-beta assets similar Bitcoin, specified periods often coincide with terms rallies arsenic superior flows into speculative markets.

Ecoinometrics mentioned that wrong 4 weeks, liquidity has returned, creating a supportive macroeconomic situation for hazard assets similar Bitcoin. The newsletter noted,

“That’s the benignant of macro backdrop wherever Bitcoin thrives. Bitcoin’s rally to caller highs didn’t travel retired of nowhere. It’s tracking the aforesaid signifier we saw since 2023: easing conditions → superior rotation → risk-on.”

With Bitcoin conscionable 2% distant from its all-time precocious price, information from CoinGlass indicates that the probability of a short-squeeze remains precocious owed to important sell-side liquidity. As illustrated below, if Bitcoin breaches $115,000, implicit $7 cardinal successful abbreviated positions could get liquidated, triggering a cascading effect that pushes prices higher.

Onchain information shows Bitcoin successful ‘overheated zone’

While the wide momentum remains bullish, Bitcoin’s rally has pushed the marketplace into a portion wherever humanities patterns impulse caution. Two cardinal onchain indicators—Supply successful Profit Market Bands and the Advanced Net UTXO Supply Ratio—are flashing signals accordant with anterior marketplace tops.

The Supply successful Profit Market Bands metric tracks however overmuch of the circulating BTC proviso is presently successful profit. As of precocious May 2025, this fig has surged to 19.4 cardinal BTC, nearing humanities extremes and entering the “Overheated Zone.” Previously, BTC prices tested this portion connected Dec. 17, 2025, which was followed by a terms correction to $93,000 from $107,000.

Simultaneously, the Advanced Net UTXO Supply Ratio (NUSR), which compares profitable versus unprofitable UTXOs (unspent transaction outputs), is brushing against its humanities ceiling astir 0.95—a level often preceding merchantability signals. Red markers connected the illustration bespeak anterior instances erstwhile specified conditions led to section terms tops oregon prolonged consolidations.

The supra information does not warrant an contiguous drop, but these metrics suggest a precocious probability of accrued volatility and profit-taking successful the short-term.

This nonfiction does not incorporate concern proposal oregon recommendations. Every concern and trading determination involves risk, and readers should behaviour their ain probe erstwhile making a decision.

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