Last night, the market was in complete chaos; just after Children's Day for the big friends, a wave of extremely sour "de-leveraging" hit the market.
BTC fell below $66,000, dropping nearly 9% directly from about $71,500 just a few days ago!
ETH (the second coin) was even worse, acting as a "amplifier" as a high Beta asset, causing ERC-20 and L2 brothers to crash in sync, with declines generally exceeding 15% to 20%.
To be honest, this wave wasn't some sudden "black swan"; it was purely a result of multiple negative factors leading to aleveraged chain reaction.
1. Who is crashing the market? Three reasons for the significant losses
This sudden decline is simply a classic combination of "failed expectations + institutional blood loss + leveraged liquidations":
MicroStrategy (a staunch BTC supporter) sold coins for the first time since 2022:
The big brother sold 32 BTC (approximately $2.5 million) to pay preferred stock dividends. Although this is a tiny amount (only 0.0038% of their holdings), it shattered the narrative belief of "never selling," causing immediate panic in the market.
ETF continues to see significant outflows, institutions are mechanically de-risking:
In May, the largest monthly outflow since 2026 was recorded, and on June 1, BlackRock and Grayscale led the withdrawal of nearly $484 million. When institutions redeem, ETFs can only sell on the spot market, pushing prices down.
$1.3 billion leveraged long liquidations:
Over the past 24 hours, more than $1.3 billion was liquidated across the network (with BTC accounting for over $700 million). Long positions being liquidated turned into market selling orders at lower prices, triggering further liquidations. During the morning's low liquidity period, a domino effect quickly unfolded.
2. The overall market has collapsed, yet HYPE was performing a "myth of immortality" at $70?
The awkward part is that countless brothers were watching the market last night, waiting for the major index to crash and impact the most volatile $HYPE so they could jump back in. But what happened? The market didn't give them time!
$HYPE did briefly drop below $70, but the buying pressure below was exceedingly strong, and by morning, it surprisingly stabilized back above $70!
Many people are puzzled: How can it recover so lightly when the overall market is bleeding? On-chain data reveals the actions of veteran traders.
1. Longs have been washed out, leaving behind a pile of "short fuel" above
Last night's plunge did indeed take out the longs. On-chain data from AiCoin shows that $HYPE saw $108 million in liquidations last night, of which $95.6 million were long positions! This means that the long leverage below $70 has been completely washed out.
But the current situation is subtle: the longs have been cleared below, while a backlog of shorts remains above.
Currently, in the $80-$115 range, there’s still approximately $489 million in short liquidation pressure!
2. The prominent short Loracle "screamed pig" and flipped to long aggressively
The most exciting game is here: Previously, the whole market was watching to see if the big short Loracle would be broken by $HYPE. Yesterday, it closed its last 171,200 short positions (suffering a tearful loss of $4.91 million) around $74.
Even more astonishing is that early this morning, it opened approximately 80,200 long positions around $70.2! Even the early employee address that "sold at $26" has now closed their shorts and shifted to a long position.
A short that has stubbornly held for so long while being watched by the entire network chose to take a loss around $70 and flip to long—this is definitely not a simple short-term play. It clearly indicates to the market: at least in the eyes of these whales, around $70 is not a position to continue selling, but a solid bottom!
The foreign media WSJ even described Hyperliquid as Wall Street's "convenience store." The influx of $15 million in buying activity amid a weak market indicates that the main narrative has not ended.
⭐ Tool portal:
https://www.aicoin.com/zh-Hans/hyper-detail/0x8def9f50456c6c4e37fa5d3d57f108ed23992dae
3. Strategy: $70 as the line of life and death, how to defend longs and shorts?
Now, simply watching the K-line is meaningless; $70 is the current watershed:
If HYPE loses $70: it indicates that the actions of major short Loracle closing its position and reversing to go long, as well as early employees buying at $70, were unable to sustain the market. The swift rebound last night was merely a temporary pullback after long liquidations. Next, HYPE will need to revisit lower price support (such as $60 or lower).
If HYPE holds above $70: it indicates that despite the overall market collapse, it remains unscathed, and the resolve of market makers and whales at this level is very strong. The accumulation of that $489 million short liquidation pressure in the $80 - $115 range will turn into the most vigorous short-squeeze fuel, launching directly towards $80, $90, or even above $100.
In such extreme market conditions characterized by fierce volatility and high stakes, holding spot assets risks missing out or being eroded, while trading with high liquidity and swift execution on Bybit contracts to capture turning points or ride breakouts is the most appropriate strategy.
The lifeline for $BTC is at: $66,000, and for long-term support, it looks at $62,000 (near the 200-week moving average).
The lifeline for $HYPE is at: $70; if it holds, it will go for the $80 - $115 short squeeze.
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Those who were waiting for a deep drop last night were not wrong in their direction; the market just didn’t provide the depth they wanted. Don't let this wave of extreme volatility after leveraged liquidation slip away; first, grab some experience funds, stay focused on $70, and if you win, it's yours; if you lose, there's a buffer!
Join our community to discuss and grow stronger together!
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🚨 Disclaimer: The above content is for reference only and does not constitute any investment advice. Trading in digital assets and derivative contracts involves high risk, with significant market volatility. Please participate rationally based on your own situation and strictly manage risks.
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