Bitcoin kicked off the week on a solid note, with supply tightening across exchanges. But liquidation data suggests a possible drop to $60,000, and a key downside risk still hangs over the market.
Supply tightens
On-chain data shows BTC balances on exchanges have been declining steadily this month. That's usually a bullish signal — fewer coins available to sell means less immediate selling pressure. The move started last week and carried into Monday, pushing prices higher.
Liquidation data warns of $60K
Despite the positive start, derivatives markets tell a different story. Liquidation levels on major exchanges show a cluster of long positions stacked around $60,000. If Bitcoin drops to that level, a cascade of forced selling could follow. Traders are watching that zone closely — a break below would likely accelerate the move.
The lingering downside risk
The bigger concern isn't just a short-term flush. A broader macro risk remains in play. Whether it's regulatory uncertainty, a shift in Fed policy, or something else, the market hasn't shaken the fear that a sudden catalyst could reverse the recent gains. Until that risk clears, any rally will carry a question mark.
For now, Bitcoin is holding above $65,000. The next few days will show whether the supply squeeze can outweigh the liquidation threat.
