Bitcoin plummeted on Sunday, failing to break above a key ceiling near $91,000, dropping almost 6% in a few hours to $85,800 on Coingecko. The selloff came after the market posted a positive weekly close (the first after four consecutive weeks of declines), but briefly appeared to be a turning point before a sharp decline.
Liquidation and trader losses
According to CoinGlass data, more than 180,000 traders were wiped out in the past 24 hours, with total liquidations totaling nearly $540 million. Almost 90% of its value comes from long bets, concentrated in Bitcoin and Ether.
The report said the sudden spike in selling volume triggered a chain reaction, doubling the price decline due to liquidations as margin positions were closed.
Some market commentators also pointed out technical quirks. The CME gap that traders have been eyeing has closed, with analysts saying about $400 million in long positions have already been taken, adding that downside liquidity has been cleared for the first time. He described this as a beneficial clean-up for the market.
Cryptocurrency liquidity issues:
As we have seen many times this year, large crypto movements often occur on Friday and Sunday nights.
We just witnessed Bitcoin drop by -$4,000 in minutes without any news.
why? Liquidity is thin.
Then add this to the facts… https://t.co/BTRNPV8Y5a
— Kobeissi Letter (@KobeissiLetter) December 1, 2025
The Kobeisi letter noted that the slide arrived without any obvious news trigger, and said the pattern has been repeated multiple times this year, especially around the late Friday and Sunday trading hours.
Macro signals and volatility
The broader context also weighed on sentiment. Investors are focused on possible changes in Federal Reserve policy, and the prospect of higher interest rates tends to weigh on risk assets such as Bitcoin.
The token’s intraday range ranged from a low of $85,400 to a high of $90,600, highlighting how quickly the price can fluctuate. The Average True Range (ATR) is at 4,423, a sign of rising daily volatility, while the Relative Strength Index (RSI) is just above 38, trending towards oversold.
Conditions were difficult in November. According to reports, Bitcoin ended the month down 18%, marking its worst November since 2018, when its price fell 35% in the same month.
Still, the asset is up 10% since the beginning of the year, and some traders believe the recent weakness is more mechanical than fundamental.
Image: ICO Bench
Market voice and its content
According to analysts quoted in Coinglass and online, most of the recent liquidations were long positions, which contributed to the decline.
Kovesi asserted that the episode was structural and related to the unwinding of crowded positions, and clarified that he did not see it as a fundamental decline. Some analysts remain optimistic, calling the move a positive reset for the month. There is a lively debate on social platforms about whether this cull will pave the way for new accumulations.
Binance CEO Richard Teng has encouraged diversification amid turbulent markets, and his sentiments echoed across the trading desk. Policy makers remain the key macro variable, and a hawkish tone from the Fed could increase selling pressure, while a more dovish stance could stabilize prices.
Traders will be keeping an eye on liquidity levels, open interest, and whether the massive long squeeze subsides. This is because these factors are likely to influence the short-term direction.
Featured images from Pexels, charts from TradingView
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