Bitcoin hits $78K on liquidation hunts amid Iran tensions
In brief
- Bitcoin reached $78,000, highest since Thursday, before declining on liquidation pressure
- US strikes on Iran rattled risk assets and questioned latest peace deal
- Funding rates turned decisively positive as long interest increased, reversing April's short bias
- Weekly spot volumes approach yearly lows amid muted crypto market activity
Liquidation spike and reversal
The pair liquidated both short and long positions with a 24-hour total of $66 million. Material Indicators told traders that BTC price action "remains driven by liquidation hunts." The trading resource flagged Bitcoin's 21-week simple moving average at $75,800, one of several nearby trend lines on the chart. Trader Daan Crypto Trades identified the biggest cluster of liquidity below price at $74,000.
Macro headwinds and funding shift
US strikes on Iran called the latest peace deal attempt into question, rattling risk assets on Tuesday's Wall Street open. WTI crude oil headed toward $95 per barrel. Yet US stock markets again shook off the concerns, hitting new all-time highs and continuing strength seen last week.
Funding rates on the day were decisively positive, reversing from negative levels as BTC long interest increased. Glassnode noted that the move marks a sharp reversal from April's heavily short-biased positioning.
Volume drought persists
"Bitcoin has spent the past week consolidating and trading broadly flat, while activity across crypto markets remains muted." — Vetle Lunde, head of research at K33 Research
Overall trading activity remained comparatively modest, per K33 Research. Weekly spot volumes are approaching yearly lows, with derivatives activity continuing to decline across both CME and offshore venues. The combination—thin liquidity, geopolitical shocks, and positioning swings—created the conditions for sharp price moves in both directions.
