Market Review: "Plunge and Pullback," Tug-of-War Near $76,000
On Wednesday (February 4th), Bitcoin experienced significant volatility during the Asian session: the price rapidly fell, dipping more than 7%, briefly breaking below the April 2025 previous low, but then quickly rebounded to around $76,000, repeatedly contending around this key round number.
Leverage Liquidation: Deleveraging Amplifies Volatility, Short-term More Fragile
Behind this round of fluctuations, deleveraging in derivatives acted as an amplifier. According to data compiled by Coinglass, over 160,000 traders were liquidated in the past 24 hours, with liquidation amounts totaling approximately $735 million. When prices swiftly break through support levels, chain liquidations often further increase volatility.
Moreover, in a broader timeframe, Reuters previously noted that recent pullbacks in risk assets have triggered large-scale liquidation of both long and short Bitcoin positions, increasing the market's sensitivity to a "decline in risk appetite."
Opinion Impact: Self-reinforcing Downtrend Under "The Big Short" Concerns
On the sentiment front, Michael Burry, the hedge fund manager made famous by "The Big Short," recently issued strong warnings about Bitcoin: if the downtrend continues, a "self-reinforcing" descending chain may form (such as pressure on institutional and corporate positions, tightening financing channels, and passive liquidation spreading to broader risk assets).
Business Insider also reported that he broke down the scenario into different price ranges (e.g., breaking below $70,000, $60,000, $50,000), and discussed the potential impact on holding companies and mining companies.
Next Focus: Two Price Levels, Three Types of Indicators
In terms of short-term trading, the market usually watches the following signals to determine whether a "rebound is a correction or a reversal":
- Price level: Whether $76,000 can hold, and the absorption strength near previous low regions (if it tests again, will it trigger a new round of liquidations).
- Liquidation Intensity: Whether the liquidation amount and number of people continue to rise (the denser the liquidations, the more likely "waterfall" volatility occurs).
- Macro Risk Appetite: If US stocks and precious metals weaken together and risk aversion rises, Bitcoin often finds it harder to strengthen independently.
