Bitcoin Blasts Past $80K and a Fresh Short Squeeze Is On

Bitcoin rallied sharply after the Federal Reserve raised interest rates by 25 basis points and published a dot-plot that implied a median policy rate of 4.1% through the end of 2027, a signal markets interpreted as more dovish than anticipated. The move helped Bitcoin recover from losses earlier in the week when the Clarity Act failed to clear a Senate procedural vote and pushed the token below $75,000. In the most recent session Bitcoin opened near $76,355, fell as low as $76,236, and then surged to an intraday high of $80,857 before settling around $80,846.

The price surge produced large forced buybacks in derivatives markets: more than $230 million of Bitcoin short positions were liquidated, contributing to a broader $445 million in liquidations across crypto. Short sellers, who profit when prices fall, face potentially unlimited losses and can be rapidly closed out if leveraged positions move against them, which can amplify price moves in a so-called short squeeze.

Technical indicators underpin the strength of the move while also flagging rapid momentum. The Average Directional Index sits at 40.6, above the 25 threshold traders use to confirm a trend, with the positive directional line leading the negative line. Bitcoin’s 50-day exponential moving average is trading above its 200-day EMA, forming a recent golden cross, and the Relative Strength Index reads 63.3 — bullish but approaching overbought territory. Meanwhile, the Squeeze Momentum Indicator has been "on" for 11 consecutive bars, indicating volatility compression that often precedes an explosive move.

Traders are watching specific levels for confirmation or risk. Immediate resistance is cited at $82,281, which bulls would need to close above to confirm a breakout; support sits at $75,569 (the 61.8% retracement) and more firmly at $68,858, the origin of the most recent leg. While trend metrics favor continuation in the near term, analysts note limited room for another large one-day advance without a cooling-off period given how quickly prices have moved.