$117 Million Futures Liquidated in One Hour as Bitcoin Tests $93k Support

VADODARA, January 5, 2026 — Major cryptocurrency exchanges recorded $117 million in futures liquidations over the past hour, with $257 million liquidated in the last 24 hours, according to aggregated exchange data. This daily crypto analysis examines the underlying market mechanics, connecting the liquidation spike to Bitcoin's price action near $93,087 and a broader fear-driven sentiment shift. Market structure suggests this event represents a liquidity grab targeting overleveraged positions, with on-chain data indicating increased selling pressure from short-term holders.

Market Context & Background

This liquidation event mirrors patterns observed during the 2021 bull market correction, where rapid price declines triggered cascading liquidations exceeding $2 billion in a single day. Historically, such spikes correlate with high leverage ratios and crowded trades, often preceding volatility compression or trend reversals. Underlying this trend is the maturation of derivatives markets, where perpetual futures now dominate trading volume, amplifying price movements through funding rate mechanisms. The current environment is further contextualized by recent developments, including the supply shock from token unlocks and shifts in the Crypto Fear & Greed Index.

What Happened?

On January 5, 2026, real-time data from exchanges including Binance, Bybit, and OKX showed $117 million in futures contracts liquidated within a 60-minute window. Of this, approximately 65% were long positions, indicating a bearish price move triggered the event. The 24-hour total reached $257 million, with long liquidations accounting for 58%. According to CoinGlass metrics, the liquidation concentration occurred as Bitcoin tested the $93,000 level, a psychological support zone that has acted as an order block in recent weeks. This activity aligns with increased open interest and funding rate fluctuations, suggesting speculative excess was being purged from the system.

Technical Analysis & Price Action

Bitcoin's price at $93,087 represents a 2.26% decline over 24 hours, testing key support at the Fibonacci 0.618 retracement level of $92,500 from the recent swing high. The Relative Strength Index (RSI) on the 4-hour chart sits at 42, indicating neutral momentum but leaning bearish. A 50-day exponential moving average at $91,200 provides secondary support, while resistance is established at $95,000, a prior fair value gap (FVG). Volume profile analysis shows increased selling volume near $93,500, confirming this as a liquidity grab zone. The bullish invalidation level is $92,500; a break below this suggests a deeper correction toward $90,000. The bearish invalidation level is $95,000; a reclaim above this negates the short-term downtrend and targets $97,000.

By The Numbers

Why It Matters

For institutional traders, this liquidation event highlights the risks of high leverage in a volatile market, potentially prompting deleveraging and reduced position sizes. It may also signal a gamma squeeze scenario where market makers adjust hedges, exacerbating price moves. For retail investors, the spike the importance of risk management, as liquidations can lead to rapid capital erosion. The broader impact relates to market stability; according to the Federal Reserve, excessive leverage in financial markets can amplify systemic risks, though crypto derivatives remain a nascent segment. Consequently, this event may pressure exchanges to adjust margin requirements or enhance risk controls.

Community Sentiment

Market analysts on X/Twitter note the liquidation spike coincides with fear sentiment, with one trader stating, "This is classic leverage washout—healthy for long-term structure." Bulls argue the purge removes weak hands, setting the stage for a rally if support holds. Bears point to the high long liquidation ratio as evidence of overoptimism cracking. Overall, sentiment is cautious, with many awaiting a clear break of the $92,500 support or $95,000 resistance for directional conviction.

Price Prediction / Future Outlook

Bullish Case: If Bitcoin holds above $92,500, the liquidation event could represent a bear trap, with short covering fueling a rebound toward $97,000. Reduced leverage may stabilize the market, aligning with historical patterns where liquidation spikes precede rallies. The EIP-4844 upgrade on Ethereum, reducing layer-2 costs, could boost overall crypto sentiment, supporting Bitcoin's price.Bearish Case: A break below $92,500 invalidates the bullish structure, targeting $90,000 and potentially $88,000. Continued fear sentiment and further liquidations could trigger a cascading sell-off, especially if institutional flows turn negative. Market structure suggests this scenario would fill the FVG near $91,000, increasing downside momentum.