The battle between long and short positions in Bitcoin is heating up! The hidden war behind the support level defense

Recently, Bitcoin's price movement has entered a critical sensitive period, continuously testing the lower support levels, with both long and short positions engaging in fierce competition around their positions. Bears are trying to expand their gains by suppressing the price, but unknowingly, they have accumulated an excessive amount of short positions, creating a risk pattern of 'tail too heavy to fall.'

Data shows that the current market's short position scale has reached a historical peak. If Bitcoin's price rebounds by 10%, it will trigger over $15 billion in forced liquidation of short positions, which is very likely to lead to a 'short squeeze' scenario — where shorts are forced to buy back their positions at high prices to stop losses, thus becoming fuel for driving the price up. Conversely, if the price continues to decline, nearly $10 billion in long positions will also face liquidation risks, and both sides are trapped in a psychological battle of 'who will hold out first.'

It is noteworthy that the current market features a significantly negative financing rate, with short funds exceeding long funds. This phenomenon has historically often signaled a reversal in market trends — when the market's consensus bearish sentiment reaches its peak, it often provides an excellent counterattack window for the bulls. This competition has evolved beyond simple technical analysis into a comprehensive battle of financial strength and market sentiment.

For long-term investors, the current period of volatility is precisely an important window to observe the market ecosystem. By tracking changes in position volume, fluctuations in financing rates, and the flow of funds on exchanges, one can more clearly grasp the cost structure of long and short positions as well as sentiment turning points. In this war of positions without gunpowder, the market fluctuations following directional choices may far exceed expectations, and investors need to closely monitor the volume coordination during key price level breakthroughs, cautiously seizing opportunities and risks brought by trend reversals.

Summary: The current spot market is somewhat unclear, and friends who only trade spot should be careful not to rush into action; they should learn to patiently wait for a breakthrough in the market (upward or downward).