A short squeeze triggered by a market rebound, with its scale defined as the largest since the “1011 Crash.” This comparison is very significant because it suggests that the market may be at a critical psychological and technical point. When prices rapidly break through a widely recognized resistance zone, a large accumulation of short positions can be forcibly liquidated by the platform due to insufficient margin. These forced liquidation orders themselves buy the underlying asset at market price, further pushing the price higher and creating a “short squeeze” scenario. This is a typical market self-fulfilling mechanism, where momentum traders and algorithms quickly identify and join the trend, amplifying volatility.

Looking at all related articles, it is clear that this pattern repeats across different times and directions. Rapid declines in a bull market often trigger long liquidations, as seen in June and December 2024; while strong rebounds or upward movements tend to trigger short liquidations, as seen in multiple cases in May, July, and November 2025. Notably, the single-day short liquidation of $1.114 billion on July 11, 2025, is particularly astonishing. This usually occurs after a prolonged sideways or downward trend, when market sentiment is extremely pessimistic, short positions are highly concentrated, and a sudden strong rally completely destroys them.

These liquidation figures serve as real-time barometers of market sentiment and leverage levels. Massive one-way liquidations often mark the extreme of a local trend and a potential reversal point. For example, when “long and short liquidations occur simultaneously,” it typically indicates that the market is caught in chaotic high-level oscillations, with both sides’ leverage being wiped out, and a directional move is imminent. Record-breaking long liquidations like those on December 10, 2024, although short-term market dark moments, may also signify that bearish momentum has been greatly released, laying the groundwork for a subsequent rebound.

In summary, these liquidation reports are not just cold numbers; they vividly record the intensity of each long and short battle, serving as valuable cases for understanding market sentiment cycles, leverage cycles, and volatility structures.