On January 14, the cryptocurrency market is experiencing a robust structural breakout, with Bitcoin successfully climbing above $96,240 on Tuesday, marking its highest level in nearly two months. The core driver of this surge lies in the concentrated covering of long-held short positions; once Bitcoin decisively broke through the critical resistance level of $94,500—a level it had failed to breach in three previous attempts—an intense "short squeeze" effect was ignited. OEXN indicated that the total liquidation of futures positions across the network has surpassed $500 million in the past four hours, a scale of liquidation that not only purges market leverage but also provides momentum for subsequent volatile upward movement.
In the interplay between the derivatives and spot markets, capital flows are exhibiting distinct characteristics. OEXN stated that Bitcoin's open interest in futures has declined from a high of $31.5 billion to $30.6 billion, a data shift revealing that derivative shorts are rapidly unwinding their positions, while the spot market is demonstrating strong buying interest. Concurrently, the collective surge in the altcoin market has become a standout feature of this rebound. OEXN believes that with DASH reaching its 2021 high as a signal, and tokens like OP and TIA posting double-digit gains, the market has formally moved beyond its previous deep correction phase, with traders' risk appetite showing a marked recovery.
Regarding the intrinsic drivers behind the market's rise, this is largely attributable to a valuation recovery following a period of extreme "oversold" conditions. After a stretch of capital flowing into precious metals and the AI sector, the crypto market's "Fear and Greed Index" repeatedly lingered in extreme fear territory; such sentiment lows often breed reversal opportunities. OEXN noted that Bitcoin's market dominance has decreased from 59.3% to 58.6%, indicating that capital is dispersing from a single asset towards a more diversified ecosystem, reflecting a healthy broadening of market breadth.
Looking at the short-term outlook, OEXN believes that the $94,500 level has now transformed from resistance into a new key support floor. Provided this level can be successfully retested and held, Bitcoin's next target for an upward push will be $99,000, a price point that also served as significant support on multiple occasions between June and November of last year. OEXN stated that although the macro narrative for 2026 is still evolving, the current technical setup and sentiment indicators have converged to form a bullish synergy. If the $94,500 level fails to hold subsequently, the market may undergo a deeper consolidation and rotation within a range of $85,000 to $94,500.
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