Investors Bet Against Bitcoin While It Approaches New Price Records

Bitcoin Approaches All-Time Highs as Traders Load Up on Shorts, Raising the Odds of a Squeeze

As bitcoin (BTC) trades above $110,000 and moves closer to its record high near $112,000, traders have been increasingly positioning for a pullback.

According to data from Coinalyze, bitcoin’s advance from $106,000 to $110,000 this week coincided with a notable decline in the long/short ratio—from 1.223 (favoring longs) down to 0.858 (showing more short positions).

This ratio tracks how many accounts are holding long versus short positions, offering insight into overall market sentiment. Interestingly, during bitcoin’s latest rally past $100,000, the ratio has slipped into negative territory multiple times, a stark contrast to the persistently bullish readings during the 2021 bull run.

Open interest also climbed sharply, rising from $32 billion to $35 billion, signaling that traders have committed substantial funds to betting against further gains. Yet funding rates have remained positive, suggesting that some investors still expect the uptrend to continue.

Since early May, bitcoin has been locked in a tight trading range between $100,000 and $110,000. Both levels have been tested repeatedly as resistance and support.

Technical indicators paint a mixed picture. The relative strength index (RSI) continues to show bearish divergence, losing momentum each time bitcoin approaches $110,000.

The jump in short positions may simply reflect short-term traders capitalizing on predictable range-bound behavior—selling near resistance at $110,000 and buying if prices retreat to $100,000. This pattern was evident on June 22, when the long/short ratio spiked to 1.68 after bitcoin briefly fell below $100,000 before bouncing back.

Still, there is a chance for an explosive move higher. If bitcoin pushes decisively above the current resistance, the large volume of shorts could be forced to close, triggering stop-loss orders and liquidations that would fuel a rapid price rally.