Analyst: This morning's drop is a typical "Deleveraging Plunge" scenario. If the forced liquidation volume continues to decrease, it indicates that the deleveraging process is nearing completion.
BlockBeats News, January 19, CryptoQuant analyst Axel posted on social media that during January 13 to 15, the "Bitcoin: Fear & Greed Index" rose to around 80%, entering the extreme greed territory, coinciding with the price approaching a local high near $97,000. Today, the index has plummeted to 44.9%, breaking below the 50% neutral threshold.
Axel explained that the "Bitcoin: Fear & Greed Index" composite index combines volume-weighted average price, net active exchange deposits, open interest delta, and long/short volume difference. Breaking below the neutral line signifies a shift in market structure and deteriorating risk quality. Reclaiming the level above 50% and holding steady would be the first signal of market stabilization; further probing into the 20% extreme fear territory could trigger a deeper adjustment risk.
In this morning's drop, the hourly liquidation amount exceeded $205 million. The spot oscillator surged to +97.96%, indicating that the liquidations were almost entirely dominated by long positions. The scale of liquidations shows that this was forced liquidation rather than active selling, typical of the "deleveraging cascade" pattern in an overheated market. If the liquidation volume continues to decrease in the next few hours, it indicates that the deleveraging process is nearing completion.
You may also like
Dan Bin's latest speech: Don't miss out on a great era
Robinhood launches its own blockchain, no longer wanting to be a tenant on others' chains
Why Tokenized Stocks Are Booming in 2026 While Crypto Is Still Struggling
From Pump.fun to Collector Crypt: Has Solana's income throne changed hands?
Looking at Stripe's ambitions and the future of stablecoins from OUSD
Do you want to buy CRCL?
Wosh: Inflation has cooled in recent weeks, AI is reshaping the economy, and forward guidance has lost its necessity
The most secretive AI winner
Former ByteDance employee's account: How I started with two Pinduoduo hard drives and made six times the profit with Seagate to achieve financial freedom?
MiCA reshuffle begins, Binance temporarily bids farewell to the EU
How does Gate redo "buying and selling stocks" from the cryptocurrency world to the stock market?
Visa and Mastercard join 140 giants to launch a new stablecoin, but the impact on the market landscape may still be limited
Circle CEO responds to OUSD's challenge: Stablecoins are a winner-takes-all business, and we will not slow down
Argentina vs Cape Verde: When a Record-Breaking Legend Meets an Unbreakable Underdog
WEEX exclusive pre-match analysis of Argentina vs Cape Verde, exploring Messi-led Argentina’s dominance and Cape Verde’s historic defensive breakout, with a breakdown of volatility, structure, and match dynamics.
