On February 6, Bitcoin [BTC] fell to a low of $60,000. The rapid losses on February 5 had resulted in $1.84 billion in long-term liquidations. Market participants feared the bear market would only worsen.
A perfect bearish storm seemed to be brewing. In his State of the Union address on February 25, President Donald Trump claimed the US economy was “roaring” but also warned of possible military action against Iran.
On February 28, the US military began a joint military action with Israel against Iran, leading to the Strait of Hormuz crisis. Closing this artery, which carries about 25% of global seaborne oil traffic, has increased the risk of long-term inflation.
As the fog of war intensified over the past two months, it was, surprisingly, the Bitcoin bears who were disproportionately blinded by BTC’s price action.
Bitcoin has not responded as participants expected
These conditions made calls for new lows below $60,000 popular in early March. Instead of falling lower, the Bitcoin bulls slowly but surely created an uptrend.
AMBCrypto had emphasized intense profit-taking activity and heightened speculative interest during the rally. The disbelief in the rally led to several short squeeze days.
CoinGlas liquidation data showed that since the end of February, there have been six days in which short liquidations in the crypto market exceeded $400 million.
During the same period, crypto long liquidations reached the $390 million mark twice, but did not cross the $400 million threshold once.
Research into the highest short liquidation days
The crypto market has been heavily influenced over the past two months by headlines ranging from US-Iran tensions, Trump’s comments, oil prices and even quantum scares.
Strong Bitcoin price movements often see aggressive altco movements as well. In the bullish State of the Union address on the economy on February 25, Bitcoin rose from $64,000 to $70,000, liquidating $588.6 million worth of short positions on the day.
On March 4, there were $478.4 million in short liquidations as BTC decisively broke the psychological barrier of $70,000. Significant ETF flows worth $461 million pointed to demand for BTC, driving prices higher.
Meanwhile, President Trump had told Congress that it was too early to be sure of the “full extent and duration” of US attacks on Iran. BTC’s momentum changed, dropping 7.9% over the next four days.
Major short liquidations worth $416.62 million took place on March 16. Bitcoin was on the verge of challenging the $75,000 level, and institutions continued to buy into this fear as negative funding rates helped fuel another short squeeze.
On that day, Iran launched a major airstrike targeting Israel and several locations across the Gulf, threatening U.S. interests in the region. BTC responded again, falling from $76,000 to $69,000 in three days.
In April, tensions between Iran and the United States appeared to cool. President Trump claimed a “total and complete victory” on April 7 after Iran agreed to unblock the Strait for two weeks.
Bitcoin responded immediately, using the $69,000 level as a starting point to rise to $72,000 by the end of the day, resulting in short liquidations of $431 million.
A new round of short liquidations worth $426.84 million took place on April 13, as the market increasingly priced in the peace story.
April 17 was the last day of these eventful weeks in which large short liquidations took place. Iran announced the opening of the Strait of Hormuz as Israel agreed to a ceasefire in Lebanon. A total of $583.52 million in short liquidations resulted from the subsequent rally.
The April uptrend extended to $79.4k on April 22 and has fallen back to $75.6k at the time of writing.
Crypto traders are lost at sea
Quantum FUD and threats to Bitcoin’s network security contributed to the perceived pressure on cryptocurrencies.
A week ago A BBC report examined trading volume data across several markets and discovered a suspicious pattern of some large traders making excessive amounts of money just before President Trump’s headline news announcements.
Crypto traders have been dealing with market-shaking news and Trump’s Truth Social posts late Sunday or before Monday’s market opened.
In late March, Iranian parliamentary speaker Mohammad Bagher Ghalibaf tweeted that traders and investors can use US political headlines as a “reverse indicator.”
A foreign statesman who tweeted trade advice to handle Trump’s announcements amid a global energy crisis may not have been on American investors’ bingo cards for 2026.
All things considered, Bitcoin has responded remarkably positively since the outbreak of airstrikes and naval blockades.
The price structure has been bearish on the higher time frames, and the current move could still reach the golden pocket of $83,000-$89,000 before being reversed.
It remains to be seen whether the popular saying ‘Sell in May, walk away’ will become a reality this summer.
Final summary
- Bitcoin has seen six days of high short liquidations since President Trump’s State of the Union address.
- The headline-driven market was accompanied by a suspicious pattern of what appeared to be insider trading before news announcements.