Bitcoin pushed down one of the largest daily candles ever on Thursday, falling more than 15%, around $10,800, in a move that rippled through derivatives, spot venues and the U.S. Bitcoin ETF complex.
It’s the size of the drop that caught his eye. Not just the percentage decline, but the mix of stress signals hitting all at once: implied volatility increases, volumes explode, and momentum gauges fall back to levels typically associated with forced selling rather than discretionary risk reduction.
Bitcoin Crash Leads to Capitulation Signals
Jamie Coutts of Real Vision framed the session as a ‘capitulation watch’, pointing to a cluster of statistics rarely seen together. He highlighted Bitcoin’s implied volatility via BVIV at 88.55, “closer to the FTX collapse peak of 105,” and noted that Coinbase recorded its eighth-largest trading day ever in USD value, with $3.34 billion changing hands – about 54,000 BTC at ~$62,000.
Coutts also underlined how extreme the momentum reset looked on the daily charts, citing a daily RSI of 15.64, “at or below the lows of the March 2020 COVID crash.” He added: “Margin calls are sounding. Forced liquidations are likely still working their way through the system. This has the signature of a capitulation event, but capitulation could be a process, not a single candle (unless we get a huge fuse!). These conditions could last for weeks or even months before a sustainable low forms.”
Macro trader Alex Krüger fell short of a price target for the lows, but argued that the market was registering the kind of positioning and price distortions that typically gather around turning points in time.
“Friends, I really don’t know where Bitcoin’s bottom is, but I can recognize extreme conditions that you only see close to the bottom over time, such as extremely negative financing, lopsided options at levels seen only once before since 2022 (FTX day), and volumes and liquidations at extraordinary levels,” he wrote. “You also have some monster shorts opened between 64k and 60k, material for a short squeeze that sends the price to 68k, and when we see that everyone starts talking about the bottom.”
Krüger’s caveat was just as direct: “In the meantime, stocks obviously have to hold up. And just because a bottom has been reached doesn’t mean you’ll see a big trend from here on out.”
Galaxy’s Alex Thorn described the tape as historically stretched in terms of RSI readings, saying that Bitcoin was “the most oversold today than at any time since 3AC exploded in June 2022 (30d RSI)”, calling it “in fact in the top 3 oversold events ever”, alongside November 2018 and June 2022.
The US spot Bitcoin ETF market failed to absorb the move, but strengthened the day’s activity. Bloomberg Intelligence’s Eric Balchunas said BlackRock’s iShares Bitcoin Trust (IBIT) “just shattered its daily volume record with $10 billion worth of shares traded,” as the fund’s price fell 13%, its second-worst daily decline since launch.
Head of research for Anchorage Digital David Lawant added that IBIT alone trading above $10 billion was the highest since launch, beating previous records by 69% in equities and 27% in USD volume.
Positioning data indicated a complex, two-sided ETF ecosystem. Head of research at K33 Research Vetle Lunde noted that the net equivalent short position in short BTC ETFs was approaching the November 2022 peak of 7,745 BTC, while 2x long BTC ETFs – products that did not exist at the time – currently hold 39,590 BTC, “at levels not seen since March 24.”
Volatility remained the common thread. ProCap CIO Jeff Park said: “Bitcoin’s implied volume is now at 75%. This is the highest level since the ETF launched in 2024. It’s also finally higher than gold’s volatility. Know that it hurts a lot right now, but this is all part of the process needed for Bitcoin to reach new highs. The meltdown will happen soon.”
At the time of writing, BTC recovered from $60,000 to around $64,900, a gain of around 9% from the session low.
Credit : www.newsbtc.com
