Bitcoin is showing signs of a developing rally toward $80,000, driven by a liquidity imbalance that has more than $4 billion in short positions vulnerable to liquidation above that level.
BTC defended support near $76,100 for two consecutive days, forming bullish divergence on the one-hour chart with improving momentum and higher lows. The price also retested $78,000 this week, and the price action is shaping an inverse head-and-shoulders pattern beneath a descending trendline.
A breakout above $78,000 could expose the fair-value gap between $79,500 and $80,300, a low-liquidity zone from a prior selloff. CoinGlass data shows the largest concentration of leveraged risk is above current levels, with short sellers facing greater pressure than bullish positions.
Liquidation activity accelerated over the past 24 hours, with 103,963 traders liquidated totaling $286.08 million. Short positions accounted for nearly $175 million. Meanwhile, CryptoQuant data shows Bitcoin-denominated open interest near 116,800 BTC, down from 120,000 BTC, indicating controlled derivatives activity.
Spot market participation remained weak during BTC’s recovery. The aggregated spot cumulative volume delta stood at -$483 million, while futures CVD turned slightly positive. Funding rates remain elevated, suggesting a bullish skew in the short term.
The split between weak spot demand and strong futures activity indicates leveraged traders are driving the upside, with the liquidity concentration above $80,000 serving as the clearest near-term retest level.