Bitcoin plunged on Sunday after failing to clear a key upper limit near $91,000 on CoinGecko, falling nearly 6% in a matter of hours and reaching $85,800. The selling occurred after the market recorded a positive weekly close. This briefly looked like a turning point before turning into the first sharp decline after four straight weeks of declines.
Liquidation and trader losses
According to CoinGlass data, more than 180,000 traders were wiped out in the last 24 hours, with total liquidation amounting to $540 million. Nearly 90% of that value came from long-term bets focused on Bitcoin and Ethereum.
According to the report, a sudden surge in sales triggers a chain reaction, causing price declines to multiply due to forced liquidations as margin positions are closed.
Some market commentators also pointed out technical issues. The CME gap observed by traders has been filled, analysts said, with about $400 million of long positions already filled, adding that downside liquidity was liquidated first. This is a useful theorem for the market, he explained.
Cryptocurrency liquidity issues:
As we’ve seen countless times this year, Friday and Sunday nights often see large cryptocurrency movements.
We just saw Bitcoin fall -$4,000 in a matter of minutes without any news.
why? Liquidity is thin.
Then add this to the facts… https://t.co/BTRNPV8Y5a
— Kobeissi Letter (@KobeissiLetter) December 1, 2025
Kobeissi Letter noted that the slide arrived without a clear news trigger, and said the pattern has been repeated several times this year, particularly during the late Friday and Sunday trading windows.
Macro Signals and Volatility
The broader context also weighed on emotions. Investors are watching for possible changes in Federal Reserve policy, and the prospect of interest rates rising tends to put pressure on risky assets like Bitcoin.
The token’s intraday range saw a low of $85,400 and a high of $90,600, highlighting how quickly the price can fluctuate. The Average True Range (ATR) is at 4,423, a sign of heightened daily volatility, while the Relative Strength Index (RSI) is just above 38, moving towards oversold.
November was rough. According to the report, Bitcoin ended November down 18%, its worst since 2018, when its price fell 35% in the same month.
Still, the asset is up 10% year to date, leading some traders to believe the recent weakness is more mechanical than fundamental.
Image: ICO Bench
Market voices and what they say
According to CoinGlass and analysts quoted online, most of the recent liquidations have been long positions, which is what has widened the decline.
Kobeissi claimed the incident was structural and related to the unwinding of congested positions and explicitly stated that he did not see it as a fundamental decline. Some analysts remained optimistic, calling this month’s moves a positive reset. There is a lot of debate on social platforms about whether this major overhaul will open new avenues for accumulation.
Binance CEO Richard Teng called for diversification during the market turmoil, a call that resonated throughout the trading desk. Policymakers remain a key macro variable. A hawkish stance from the Fed could increase selling pressure, while a dovish stance could stabilize prices.
Traders will be watching liquidity levels, open interest, and whether the massive buying pressure subsides. Because these factors are likely to determine the short-term direction.
Featured image from Pexels, chart from TradingView
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