Bitcoin Bounces Back Above $78,000 After $80M Shorts Liquidated

Bitcoin staged a significant recovery on September 17 and 18, surging over $2,000 in eight hours to reclaim the $78,000 mark. The cryptocurrency had dipped below $76,300 due to forced liquidations of leveraged bearish positions.

A total of $247 million in short positions were liquidated across crypto markets during this period, with Bitcoin-specific short liquidations accounting for around $66 million. Meanwhile, long liquidations came in at roughly $32 million.

The Federal Reserve's 25-basis-point interest rate hike on September 16 and 17 had initially pushed Bitcoin below $76,000 as risk assets sold off across the board. The $78,000 level had attracted attention due to its psychological and technical significance, particularly given the dense cluster of short interest sitting just above it.

While the recovery is primarily driven by short liquidations rather than organic buying interest, a sustained hold above $78,000 could lift sentiment across altcoins. Conversely, a reversal back toward the lower end of the recent range would likely drag the wider market with it.