Bitcoin Drops but Hyperliquid Hits Long Records: Is Squeeze Coming?

Bitcoin continues to test investors’ nerves. While the price of the leading cryptocurrency slides toward local lows in the $62,400–$63,600 area, testing the important 200-week moving average, a powerful countertrend move is forming in the derivatives market.

According to a fresh report from Glassnode, large players on the decentralized exchange Hyperliquid have launched a large-scale campaign to buy the dip. While the $BTC price chart continues to revisit local lows, the net volume of long positions on Hyperliquid, on the contrary, is steadily growing and has reached yearly highs.

The main attraction of the week lies in the phenomenal stubbornness of Hyperliquid traders. Aggressive accumulation of long positions directly during the price decline is creating a spring that could snap at any moment.

“Positioning is becoming increasingly bullish throughout the entire downtrend,” Glassnode noted. Such a concentration of long positions, amid declining overall selling pressure, sharply increases the probability of a so-called short squeeze.

$16 billion buy wall to trigger short squeeze

Bitcoin’s current decline is largely synchronized with global stock markets: the crypto market has been hit by a correction wave caused by profit-taking in the U.S. technology sector and shares of AI giants. However, on-chain data shows that “smart money” is using this sell-off to accumulate assets.

In the narrow price corridor between $59,000 and $67,000, investors of all sizes have bought more than 259,000 $BTC from the spot market over the past 10 days. This has formed a reinforced $16 billion support block that is still holding back bearish pressure.

There is no panic on major centralized exchanges such as Binance and OKX, and aggregate futures open interest is frozen at $31.2 billion. This suggests that excessive and dangerous leverage has already been flushed out of the market, while current positions are backed by real capital.

If Bitcoin finds a bottom near the current moving average and shows even the slightest upward impulse, it could trigger an avalanche of short closures and instantly catapult the price back toward the upper boundary of the range.