Bitcoin’s price has fallen 14.5% in 16 days, hitting the Crypto Fear & Greed Index at 16 (Extreme Fear), its lowest year-to-date rating. Analysts suggest current trader positioning could lead to a recovery, with a move toward $92,000 potentially putting over $6.5 billion in short positions at risk of liquidation.

BTC has cleared swing lows between $80,000 and $83,000, indicating a potential shift higher. A move to $92,000 may threaten $6.5 billion in short positions, while a drop to $72,600 would only risk about $1.2 billion. This market imbalance may drive short sellers to buy back positions, boosting price recovery.

Crypto commentator Marty Party frames the recent dip below $83,000 as part of a Wyckoff Accumulation “Spring,” suggesting larger players are buying discounted Bitcoin for a potential price expansion towards $100,000. Bitcoin futures positioning shows mixed signals, with open interest on Binance rising to 123,500 BTC, indicating traders are rebuilding exposure.

Broader derivatives activity has cooled, with monthly Bitcoin futures volume across all exchanges dropping to around $1.09 trillion in January, the lowest since 2024. Major venues like Binance, OKX, and Bybit saw the most trading activity. This article does not provide investment advice, and readers are encouraged to conduct their own research before making decisions.

Read more at Cointelegraph: $6 Billion Bitcoin Short Positions May Fuel Rally Back Above $90K