Liquidation Heatmap on May 19: Increase to liquidate and then drop sharply – a pullback or the beginning of distribution?
On the BTC/USDT liquidation heatmap chart for May 19, the market created a strong spike to the mark of 107,545 before turning around and dropping deeply to the region of 102,000. This occurred right after the area with the highest liquidity was 'swept clean' with liquidation amounting to 71.38 million USD – equivalent to a large-scale position squeeze, typically short being squeezed.
But what is even more noteworthy is the reaction immediately after: no new capital came in to support the price. After the sweep, the price was sold off again, and this time the market no longer had buying power to absorb it. This usually indicates two possibilities:
– One is that this is a technical pullback wave, returning to test a lower support area, possibly in the region of 101,000 – where many clusters of positions were liquidated previously but have not been tested again.
– Two is that the market has just completed a short-term distribution: pushing the price up to liquidate weak shorts, attracting more FOMO participants, and then reversing to 'take profits'.
This is not the first time such a pattern has appeared, but this time it is quite textbook: a sharp increase – sudden liquidity spike – then a steady decline.
Personal view: during this period, one should be extremely cautious with pumps. If not accompanied by strong volume increases and Long positions not dominating, it can easily just be a technical trap.
Not investment advice. I always wait for clear confirmation rather than jumping in amidst emotions.
