Bitcoin price briefly moved towards $80,000 for the first time since May as short liquidations surpass $220 million. Analysts are now watching whether BTC can sustain the breakout.
BTC$78,680.00+1.91%Bitcoin price briefly moved towards $80,000 on Monday, marking its first move above the psychological level since May as bullish momentum continued to strengthen across the crypto market.
The move extended Bitcoin's powerful August recovery, with BTC now up roughly 25% for the month. However, analysts warn that Bitcoin needs to sustain higher levels before the latest breakout can definitively challenge the broader bearish market structure.
The move towards $80,000 also triggered another wave of short liquidations, with more than $220 million in crypto short positions wiped out over 24 hours, according to CoinGlass data.
Bitcoin climbed to $80,000 after the U.S. stock market opened on Monday, briefly reaching the milestone for the first time since May 15.
BTC subsequently pulled back from the level, but the move nevertheless represents another important step in Bitcoin's ongoing recovery.
Bitcoin has now gained approximately 25% in August, putting the cryptocurrency on track for its strongest August performance since 2017.
The latest rally follows the sharp move that began last week when Bitcoin climbed from around $64,000 to nearly $80,000. The rally was supported by improving liquidity expectations, strong ETF demand and a massive short squeeze across the crypto market.
As Bitcoin moved higher, traders betting on further downside were forced to close their positions, adding additional buying pressure.
The move above $80,000 triggered another wave of liquidations across the derivatives market.
More than $220 million in crypto short positions were liquidated over the previous 24 hours, according to CoinGlass data.
Short liquidations can accelerate an existing rally because traders are forced to buy the underlying asset to close losing positions. When multiple short positions are liquidated at similar price levels, the resulting forced buying can push prices even higher.
However, the market is beginning to watch whether spot demand can replace this forced buying.
Bitcoin has already experienced one of the largest short squeezes of the year. More than $3 billion in short positions were wiped out during the initial August rally, meaning another sustained advance may require stronger organic demand from spot buyers.
Despite Bitcoin's breakout, analyst Rekt Capital believes the market still needs to prove that the move can hold.
The analyst has been closely watching Bitcoin's 50-week exponential moving average (EMA), which is currently around $77,251.
Bitcoin's latest weekly close above this indicator is significant because it is the first such close since November 2025. A sustained move above the 50-week EMA could strengthen the bullish case and suggest that the long-term trend is beginning to change.
However, historical precedent provides a warning.
During Bitcoin's 2022 bear market, BTC managed to close above the 50-week EMA twice before eventually falling toward cycle lows. This means that simply reclaiming the indicator does not guarantee that the broader bearish structure has ended.
The next few trading sessions could therefore be crucial for Bitcoin.
A sustained move above $80,000 would strengthen the bullish breakout and could encourage traders to target higher levels. Conversely, a failure to hold the breakout could result in profit-taking and another test of lower support.
A significant support area is developing around $76,700, where bid liquidity could provide a cushion if Bitcoin experiences a short-term correction.
The recent rally has already pushed Bitcoin significantly higher from its August lows, so a period of consolidation would not necessarily invalidate the broader recovery.
The key question is whether Bitcoin can maintain prices above the major technical levels it has recently reclaimed.
Institutional demand could help determine whether the latest Bitcoin rally has staying power.
U.S. spot Bitcoin ETFs attracted approximately $1.92 billion in net inflows during the week ended August 21, their strongest weekly performance since October 2025. BlackRock's IBIT accounted for a significant portion of that demand.
This provides an important contrast with the liquidation-driven buying seen during the initial rally.
Related: Altcoin Buzz previously reported on the historic August 20 short squeeze, when Bitcoin broke above its 200-day EMA as more than $3 billion in short positions were liquidated.
Bitcoin's move towards $80,000 represents another major milestone in the ongoing recovery, but the breakout still needs confirmation.
Holding above the $77,251 50-week EMA and defending the $76,700 liquidity zone would strengthen the bullish structure. A sustained move above $80,000, meanwhile, could encourage further upside.
However, another rejection could expose BTC to profit-taking, particularly after such a rapid rally.
For now, Bitcoin's combination of strong ETF inflows, improving market sentiment and continued short liquidations has created a powerful bullish setup. The next challenge is proving that the rally can continue even after the forced buying from short sellers begins to fade.
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