Short Squeeze Explosion: Why Bitcoin Soared to $75,000 and What It Means for the Market
The current recovery of the first cryptocurrency to the $75,000 mark is not so much a manifestation of healthy bullish momentum as it is a classic market maneuver triggered by the forced closure of short positions. Based on data from the Binance futures market, we are witnessing the most powerful short squeeze in the past two years, which is mechanically pushing the price upward.
The Short Squeeze Value indicator on Binance reached 6.94 this week, a two-year high. For comparison: in November 2024, a similar figure was recorded at 5.38. This suggests that the current growth has little to do with organic demand—it is almost entirely owed to the liquidation of short positions by traders who were forced to buy back the asset to cover losses.
The mechanics of "frightened" growth
Such dynamics are characteristic of bearish phases, when the market shows sharp but short-term bursts of volatility. As soon as the "fuel" in the form of liquidation orders runs out, and spot demand fails to fill this gap, we risk seeing an equally sharp pullback. This is an extremely fragile structure that requires a cautious approach from investors not inclined to excessive risk.
A glimmer of hope: a bullish signal
However, not everything is so clear-cut. Another analyst, known under the pseudonym Darkfost, draws attention to the Bitcoin Bull Score metric, which for the first time since October 2025 has returned to the bullish zone, surpassing the 60 mark. Notably, even in May, when bitcoin was storming $82,000, this indicator did not show such strength. Now, six out of ten key metrics have turned "green," including demand growth, stablecoin liquidity, and investors' realized price.
If this indicator can hold at its current level and continue to rise, we may witness the formation of a new bullish cycle. However, I believe relying solely on this signal would be premature. The market is currently at a bifurcation point: either spot demand confirms the movement and we see a sustained uptrend, or we witness yet another bull trap. At such moments, it is critically important to monitor the volume of real purchases on the spot market, not just the movement of derivatives.