Bitcoin “Sharks” Signal Bullish Trend Despite $5.39 Billion Liquidation Event
A staggering $5.39 billion in leveraged positions evaporated on Friday, marking the largest daily drop in Bitcoin’s history. Yet, beneath the surface of this dramatic correction, a compelling narrative is unfolding: seasoned investors, often referred to as “sharks,” are actively buying the dip, suggesting this isn’t the start of a bear market, but a potential buying opportunity. This resilience, coupled with key technical indicators, points to a possible rally in the coming weeks.
The Anatomy of the Dip and the Resilience of Bitcoin
The recent sell-off triggered widespread panic, particularly among highly leveraged traders. Data from DefiLlama revealed liquidations more than doubled those seen during the 2020 COVID-19 crash. However, Bitcoin has already rebounded 8.50% since hitting a low around $103,000, currently trading 11% below its all-time high of $126,300. This swift recovery isn’t simply a fluke; it’s underpinned by fundamental and technical factors.
Zooming Out: A Milder Correction in Perspective
While the immediate impact of the $5.39 billion liquidation was significant, a broader look at Bitcoin’s price history reveals this correction is relatively mild compared to previous declines. The weekly chart shows a less than 10% drop, significantly less than the 14-15% dips experienced in March 2025 and July 2024 – both of which were followed by substantial rallies. This historical context suggests the current downturn could be a temporary setback within a continuing bullish trend.
Bitcoin continues to trade within an ascending channel established since mid-2023, a bullish pattern indicating sustained upward momentum. Each test of the channel’s lower boundary has historically been met with renewed buying pressure. Analyst Michael van de Poppe highlights the crucial 20-week moving average (20-week MA) near $111,000 as a key support level. Holding above this level could signal a final capitulation phase, mirroring those seen during the COVID-19 crash and the FTX collapse, paving the way for a new uptrend.
“Shark” Accumulation: A Signal of Confidence
The most compelling signal of potential recovery comes from the behavior of Bitcoin “sharks” – wallets holding between 100 and 1,000 BTC. While smaller traders were forced to exit positions during Friday’s sell-off, these larger holders aggressively accumulated Bitcoin. Glassnode data shows the daily change in the net position of sharks surged to 190,296, the highest level since September 2012.
Key Takeaway: The aggressive buying by “sharks” suggests a strong belief in Bitcoin’s long-term potential and a willingness to capitalize on short-term price dips.
Furthermore, the total supply of Bitcoin held by these sharks has grown exponentially in 2025, reaching a new record despite the price decline. This indicates a lack of panic among experienced investors and suggests they view the correction as a buying opportunity. This accumulation could fuel the next significant rally if the trend continues.
Bollinger Bands: A Historical Indicator of Bull Market Strength
Technical analyst The Great Mattsby adds another layer of optimism, pointing to Bitcoin’s Bollinger Bands. These bands, which measure market volatility, are currently contracting. Historically, bull markets have ended only *after* Bollinger Bands have fully expanded, indicating excessive volatility.
“Using history as a guide, bear markets do not begin when the monthly Bollinger Bands are still contracting. They begin at the end of their expansion,” Mattsby stated. The current contraction suggests that the recent correction may be a mid-cycle cooldown rather than the beginning of a prolonged bear market.
Pro Tip:
Pay attention to the 20-week moving average. It’s a crucial support level that, if held, could confirm the bullish outlook. Consider setting price alerts to monitor Bitcoin’s movement around this level.
What Does This Mean for the Future of Bitcoin?
The confluence of these factors – the resilience of the price, the accumulation by “sharks,” and the contracting Bollinger Bands – paints a cautiously optimistic picture for Bitcoin’s future. While volatility is inherent in the cryptocurrency market, these indicators suggest the current correction may be a temporary pause within a larger, ongoing bull run. A potential target of $140,000 – $150,000 by the end of the year, as suggested by van de Poppe, remains within reach.
Frequently Asked Questions
Q: What are “sharks” in the Bitcoin context?
A: “Sharks” refer to Bitcoin holders with wallets containing between 100 and 1,000 BTC. They are considered experienced investors who often have a significant impact on market movements.
Q: What are Bollinger Bands and how do they help predict price movements?
A: Bollinger Bands are a technical analysis tool that measures market volatility. Contracting bands often precede price increases, while expanding bands can signal potential market tops or bottoms.
Q: Is Bitcoin still a risky investment?
A: Yes, Bitcoin remains a volatile asset. While the indicators discussed suggest a bullish outlook, investors should always conduct thorough research and understand the risks involved before investing.
Q: Where can I learn more about technical analysis?
A: See our guide on understanding technical indicators for a deeper dive into the tools used to analyze market trends.
What are your predictions for Bitcoin’s performance in the coming months? Share your thoughts in the comments below!
