In the short term, prices look calm. But derivatives data suggests this quiet feels a bit forced.

Max pain sits higher, sentiment still leans lower

At the time of writing, Bitcoin is trading around $66,372. Total open interest exceeds $2.53 billion, while the max-pain level stands near $74,000.

On the Ethereum side, the picture is similar. Price is hovering near $1,950, notional open interest is roughly $425 million, and max pain sits around $2,100.

In theory, this implies a meaningful portion of the market would benefit if prices drift higher toward those max-pain levels. In practice, things aren’t that simple. Options sentiment remains cautious.

The rebound following last week’s sharp sell-off hasn’t fully repaired trader psychology.

Put skew still dominates: downside protection hasn’t faded

Derivatives analytics firm Laevitas notes that Bitcoin risk reversals remain in negative territory despite some recovery. One-week and one-month 25-delta RR readings sit near −13 and −11 vols, respectively.

What does that mean? Simply put, traders are still willing to pay up for downside insurance. Put premiums remain elevated. That keeps the idea of “more downside is possible” very much alive.

Risk reversals are often used to cut through the noise. Right now, the signal is clear: fear hasn’t fully left the room.

Fragile equilibrium after the liquidation shock

Last week’s drop below $70,000 in Bitcoin triggered a cascade of liquidations and one of the sharpest shifts toward put demand seen in years. According to Deribit analysts, it marked one of the most extreme skew moves in recent memory.

Prices later bounced back toward the $67K zone. But events like this leave scars. Trader behavior changes. Risk appetite pulls back for a while. What we’re seeing now fits that pattern.

Yes, some players have started rotating back into call options as volatility cools from panic levels. Still, that shift remains fragile.

Deribit openly describes the market as sitting at a “critical inflection point.”

Institutions remain cautious on the medium term

Options flow tracked by Greeks.live shows put dominance persisting in Bitcoin derivatives.

More than $1 billion in BTC put options traded today, accounting for roughly 37% of total volume. Most of that activity is concentrated in out-of-the-money strikes between $60,000 and $65,000.

That detail matters. Positions like these are typically opened for medium-term protection rather than short-term trading. According to Greeks.live analysts, institutional players appear to be pricing in a weaker market structure over the next one to two months.

Surface calm, deeper defensiveness.

Will expiry ease pressure — or light the fuse?

Expiries of this size can sometimes create short-term “gravitational” effects on price, especially around strikes with heavy open interest.

After today’s settlement, two paths stand out.

First, the release of options pressure could allow markets to breathe a little and head into the weekend on steadier footing.
Second, unwinding hedges could just as easily spark a fresh volatility wave.

Which one plays out? Derivatives data doesn’t offer a clean answer yet. Short-dated call interest is improving, but medium-term put demand remains strong. That split usually defines uncertain markets.

Sometimes silence is just silence. Sometimes it’s the gap before the next move. This weekend may tell which one it is.

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Toward the U.S. market close, BTC first dropped 4.8% to around $60,033. The selling failed to deepen. Buyers stepped in. Price quickly climbed to $65,926.

The move came just one day after Thursday’s 13% plunge, Bitcoin’s steepest daily loss since November 2022.

$700 Million in Liquidations Rocked the Market

According to CoinGlass data, roughly $700 million in leveraged crypto positions were wiped out in just the last four hours.

Of that total:

• $530 million came from long positions

• $170 million from shorts

The mix shows traders were hit hard on the way down — then caught on the wrong side again during the rebound. In other words, market direction was driven less by conviction and more by aggressive leverage.

The $60,000 level acted as a psychological floor traders had been watching for weeks. Spot buyers stepped in around that zone, igniting the bounce.

Damien Loh, Chief Investment Officer at Ericsenz Capital, said the area signals strong technical support, but warned that overall market sentiment remains fragile.

Altcoins Followed — Solana Recovered Losses Within Hours

Bitcoin’s turbulence spread across the broader crypto market.

Solana, for example, fell as much as 14% intraday, only to erase those losses within hours. The rapid reversal highlighted how quickly risk appetite can shift when liquidity tightens.

Since October’s liquidation cascades, crypto markets have already been unstable. The latest drop intensified as global markets turned risk-off. Investors dumped speculative assets — and crypto was pulled into the same current.

Strategy Reports $12.4 Billion Quarterly Loss

Bitcoin’s pullback is now showing up on corporate balance sheets.

Michael Saylor–led Strategy said Thursday it posted a $12.4 billion net loss for Q4, driven by markdowns on its Bitcoin holdings.

Price volatility is no longer hitting just traders. It’s landing directly on institutions.

Fear Index Falls to 9: “Extreme Fear” Territory

Despite the rebound, psychology remains under pressure.

The Crypto Fear & Greed Index dropped to 9, flashing “extreme fear.” The index stood at 12 a day earlier, 16 last week, and 42 last month — a sharp slide that shows how quickly investors shifted from cautious to defensive.

The index blends volatility, volume, momentum, social media activity, Bitcoin dominance, and Google Trends data. It’s designed to measure sentiment, not predict price.

Right now, the signal is clear: the market is operating in “sell first, think later” mode.

Does Extreme Fear Signal a Bottom?

In past cycles, extreme fear often aligned with local bottoms, largely because panic flushes out leveraged traders and short-term speculators.

But it’s not a rule.

The index should be read as a snapshot of stress, not a timing tool.

While Bitcoin rebounded from near $60,000 to $65,000, current data suggests the market is still being driven by leverage rather than conviction — pointing to elevated volatility in the days ahead.

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The post $700M Liquidations Rock Bitcoin — BTC Back Above $65K appeared first on Coin Engineer.

Analyzing the liquidations reveals that $366 million of losses came from long positions. Meanwhile, $151.51 million worth of liquidations occurred in short positions. This distribution indicates that the overall market direction reversed unexpectedly. The largest single liquidation happened on the OKX exchange at the BTC/USDT swap pair. In this trade, a $17.35 million position was liquidated. At the time of writing, Bitcoin is trading around $114,760. 

Long Positions Took a Major Hit 

The data shows that investors holding long positions suffered significant losses. In just the last 12 hours, $287.43 million worth of long positions were liquidated. During the same period, the total loss on short positions was limited to around $32.85 million. This situation reveals that most traders took positions expecting a price increase, but prices moved in the opposite direction. 

Meanwhile, the total liquidation over the last 4 hours was recorded at $48.18 million. Of this amount, $29.05 million came from long positions and $19.13 million from short positions. Within the last 1 hour, $14.7 million worth of positions were liquidated. Long traders were again the most affected, with $9.9 million in long positions wiped out, while short traders lost $4.79 million. 

What Does This Liquidation Wave Mean? 

These liquidations impact not only individual investors but also professional traders. Positions using high leverage are quickly wiped out during sudden price moves. Bitcoin faced intense selling pressure during this period, and other major cryptocurrencies similarly declined. 

However, such large liquidations often lead to temporary price relief. Still, investors need to be cautious, manage their leverage levels carefully, and keep stop-loss strategies active. Volatile days like these demonstrate how quickly market sentiment can shift.

You can also freely share your thoughts and comments about the topic in the comment section. Additionally, don’t forget to follow us on our Telegram, YouTube, and Twitter channels for the latest news and updates. 

The post 143K Traders Liquidated in 24 Hours! $517 Million Liquidation appeared first on Coin Engineer.