Bitcoin Rebounds 26% After Record-Breaking Short Liquidation, Tests $81,000, $86,000 Supply Cluster
A record-breaking short liquidation in August sparked a roughly 26% rally for Bitcoin, propelling its price above $81,000. Unlike previous short-term squeezes driven solely by leverage, this rebound has been supported by genuine buying pressure from U.S. spot ETFs and on-chain wallet size groups.
According to data from Glassnode, the largest single-day short liquidations occurred on August 19, with 85% of total liquidations taking place during this period. The price path triggered simulated liquidation clusters one by one, with approximately 86% of liquidations absorbed along the way.
The rebound has also been driven by a concentrated release of stop-loss orders triggering passive liquidations, rather than new longs chasing prices. Open interest in futures contracts contracted by 11% during the window period, indicating that leveraged positions were unwound.
U.S. spot Bitcoin ETFs achieved net inflows of $2.23 billion during the short squeeze window, with no daily outflows throughout the period. This marks the strongest weekly capital inflow of the year, with the single-day subscription volume reaching its highest level since January 14, 2026.
The Composite Cycle Indicator has rebounded to the neutral threshold of 40, positioning the current market in the early stage of the cycle. The rebound structure exhibits a 'heavy head, light tail' characteristic, with large-cap assets dominating the rally.