Source: Cointelegraph.com NewsKey takeaways:<\/p>\n
Bitcoin could turn parabolic if prices move above $115,000 to liquidate more than $7 billion in short positions.
\nOnchain indicators enter overheated territory, suggesting prolonged profit-taking from BTC investors.<\/p>\n
Bitcoin (BTC) showed strength on May 27, briefly tagging $110,700 after a strong US equities market open and the Trump Media and Technology Group\u2019s announcement that it would raise $2.5 billion for a Bitcoin treasury. Source: Cointelegraph.com NewsKey takeaways: Bitcoin could turn parabolic if prices move above $115,000 to liquidate more than $7 billion in short positions. Onchain indicators enter overheated territory, suggesting prolonged profit-taking… <\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[5],"tags":[],"_links":{"self":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts\/130112"}],"collection":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=130112"}],"version-history":[{"count":0,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts\/130112\/revisions"}],"wp:attachment":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=130112"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=130112"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=130112"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nBitcoin\u2019s bullish momentum aligns with the favorable US financial conditions, as noted by Ecoinometrics. The macroeconomic-focused Bitcoin newsletter highlighted that the National Financial Conditions Index (NFCI) shows a rapid shift to ultra-loose territory after a tightening phase in February 2025.
\nThe NFCI, published by the Federal Reserve Bank of Chicago, tracks stress in the financial system by aggregating measures like credit spreads, leverage, and funding conditions. When the index moves into looser territory, it reflects easier access to capital and reduced market stress\u2014conditions that typically encourage risk-taking behavior among investors.
\nFor high-beta assets like Bitcoin, such periods often coincide with price rallies as capital flows into speculative markets.
\nUS National Financial Conditions Index. Source: EcoinometricsEcoinometrics mentioned that within four weeks, liquidity has returned, creating a supportive macroeconomic environment for risk assets like Bitcoin. The newsletter noted,
\n\u201cThat\u2019s the kind of macro backdrop where Bitcoin thrives. Bitcoin\u2019s rally to new highs didn\u2019t come out of nowhere. It\u2019s tracking the same pattern we saw since 2023: easing conditions \u2192 capital rotation \u2192 risk-on.\u201d
\nWith Bitcoin just 2% away from its all-time high price, data from CoinGlass indicates that the probability of a short-squeeze remains high due to significant sell-side liquidity. As illustrated below, if Bitcoin breaches $115,000, over $7 billion in short positions could get liquidated, triggering a cascading effect that pushes prices higher.
\nBitcoin liquidation map. Source: CoinGlassRelated: Bitcoin shows signs of ‘easing momentum’ but traders still expect $150K
\nOnchain data shows Bitcoin in \u2018overheated zone\u2019
\nWhile the overall momentum remains bullish, Bitcoin\u2019s rally has pushed the market into a zone where historical patterns urge caution. Two key onchain indicators\u2014Supply in Profit Market Bands and the Advanced Net UTXO Supply Ratio\u2014are flashing signals consistent with prior market tops.
\nThe Supply in Profit Market Bands metric tracks how much of the circulating BTC supply is currently in profit. As of late May 2025, this figure has surged to 19.4 million BTC, nearing historical extremes and entering the \u201cOverheated Zone.\u201d Previously, BTC prices tested this zone on Dec. 17, 2025, which was followed by a price correction to $93,000 from $107,000.
\nBitcoin Supply in Profit Market Bands. Source: CryptoQuantSimultaneously, the Advanced Net UTXO Supply Ratio (NUSR), which compares profitable versus unprofitable UTXOs (unspent transaction outputs), is brushing against its historical ceiling around 0.95\u2014a level frequently preceding sell signals. Red markers on the chart indicate prior instances when such conditions led to local price tops or prolonged consolidations.
\nBitcoin Advanced Net UTXO Supply Ratio chart. Source: CryptoQuantThe above data does not guarantee an immediate drop, but these metrics suggest a high probability of increased volatility and profit-taking in the short-term.
\nRelated: Bitcoin 2024 conference sparked 30% price crash \u2014 Can bulls escape this year?
\nThis article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.Read More<\/a><\/p>","protected":false},"excerpt":{"rendered":"