Crypto traders were hit from both sides as Bitcoin surged past $106,000, only to drop sharply to $103,000, triggering over $600 million in liquidations across major altcoin futures like ETH, SOL, and DOGE.

⚙️ What Actually Happened?

• Around 21:00 UTC Sunday, Bitcoin rallied ~$2,500 in under an hour.
• The spike was likely driven by thin weekend liquidity and algorithmic buying near technical levels.
• The result? A classic short squeeze, followed by a wave of profit-taking and stop runs.

This volatile action wiped out:

• 🔻 $460M in long positions
• 🔻 $220M in shorts
  — impacting ETH, SOL, DOGE, and XRP.

📉 Macros Add Fuel to the Fire

The drama unfolded as broader markets were already nervous:

• Moody’s downgraded the U.S. credit rating, sparking uncertainty.
• Treasury yields spiked above 5% on long-term bonds.
• Inflation jitters resurfaced, creating caution in risk markets.

Even with ongoing institutional interest in Bitcoin and ETF inflows, traders are hesitating near key resistance levels — especially after BTC failed to hold above the psychological $106K mark.

📊 Market Sentiment

Bitcoin remains flat on the week, but many expect increased volatility ahead:

“Investors are rotating into Bitcoin amid fiscal concerns, but the market isn’t ready for leverage-heavy positions yet,” said HashKey co-CEO Haiyang Ru.

Some expect this chop to continue as the U.S. prepares to finalize spending policies that could affect liquidity and Treasury markets.

🧠 Trading insight: Sharp liquidation events like this often shake out weak hands — but they also set the stage for accumulation just below resistance. If BTC stabilizes near $103K, bulls may get a second wind.

This article is for educational purposes only and does not constitute investment advice.