Bitcoin rises to $77,000 as traders eye $80K short squeeze

Bitcoin rebounded to roughly $77,000 on Friday, erasing a dip below $75,000 that marked its lowest level since mid‑April and reviving expectations of a short squeeze near $80,000 [1].

Market sentiment and the peace‑deal narrative

The price lift coincided with growing optimism that a US‑Iran peace agreement could lift risk assets. Stock futures were already climbing toward record highs, and analysts noted that such a deal would act as a “tailwind” for Bitcoin [1]. Traders like Michaël van de Poppe suggested that a confirmed deal could push BTC above $80,000 [1]. At the same time, the broader macro backdrop remains mixed: the Federal Reserve’s inflation fight continues, with April PCE data due and rate‑cut expectations still low [1].

On‑chain flows and short‑position pressure

CryptoQuant flagged a three‑fold surge in Bitcoin inflows to Binance over ten days, from an average of 378 BTC to 1,190 BTC, with a single‑day peak of over 3,600 BTC on May 18 [1]. Binance’s reserves grew by 16,000 BTC in the month, a pattern traditionally read as a sell signal because holders often move coins to an exchange before exiting positions [1]. Concurrently, the Coinbase Premium Index turned sharply negative, indicating weaker US institutional demand for spot Bitcoin ETFs, which have seen $1.74 billion of outflows [1]. These dynamics suggest that while retail inflows to Binance are strong, short‑position pressure remains high, especially as price approaches the $80,500 zone where many leveraged shorts sit [1].

Technical context

The rebound to $77,000 sits just below the $80,000‑$80.5 k “short‑squeeze” band identified by traders monitoring order‑book liquidity [1]. Earlier in the week, Bitcoin briefly fell below the high‑timeframe support range that aligns with an April 2025 bottoming formation, a move some analysts labeled a “fakeout” [1]. The daily chart still shows resistance around $70,000‑$72,000, a level that has capped recent rallies [2]. If Bitcoin can hold above $77,000, the next hurdle is breaking that resistance and testing the $80,000 zone, where a liquidation cascade could accelerate the move upward.

What to watch

• $80,000‑$80.5 k zone – watch for a sharp rise in liquidation volume that could trigger a short squeeze.
• April PCE data – the Fed’s preferred inflation gauge may influence monetary policy expectations and risk‑asset sentiment.
• Binance BTC inflow trends – a continued rise could signal further sell pressure, while a slowdown may hint at reduced short‑covering demand.

The price bounce shows that short‑squeeze expectations and geopolitical optimism can quickly revive Bitcoin’s momentum, but the confluence of heavy exchange inflows and muted institutional demand leaves the next move uncertain. Whether the $80,000 barrier holds or breaks will likely decide if the rally is a fleeting bounce or the start of a broader recovery.