Bitcoin Nears $64K After $450M Crypto Short Squeeze
Bitcoin climbed to $63,900 early on Monday, July 6, reaching its highest level in two weeks. The rally followed weaker-than-expected U.S. jobs data, which triggered the liquidation of nearly $450 million in short positions across crypto derivatives markets.
The move began after the June employment report showed the U.S. economy added only 57,000 nonfarm jobs. That figure fell well below the forecast of 113,000 and slowed significantly from May’s revised total of 129,000. In addition, revisions to the previous two months removed another 74,000 jobs from earlier estimates.
Weak Jobs Data Fuels Bitcoin Rally
Investors viewed the softer labor market data as a sign that the Federal Reserve could lower interest rates sooner than expected. Consequently, U.S. Treasury yields declined while the U.S. dollar weakened. Those conditions reduced Bitcoin’s carrying cost and encouraged leveraged traders to close their short positions.
As Bitcoin crossed the $62,000 level, forced liquidations accelerated buying pressure. Therefore, the cryptocurrency surged toward $64,000 during the short squeeze. Data from Coinglass showed that roughly $450 million in short positions were liquidated within 24 hours. However, Bitcoin later eased to around $62,600.
ETF Inflows Return but Market Remains Cautious
The rally also coincided with renewed institutional interest in spot Bitcoin exchange-traded funds. On July 3, U.S.-listed spot Bitcoin ETFs recorded $221.7 million in net inflows, marking their strongest daily performance in two months. Moreover, the inflows ended a 10-day streak that saw $2.73 billion leave the funds. Fidelity’s FBTC attracted $165.96 million, while ARK’s ARKB added $91.84 million.
Despite the positive inflows, the broader trend remains cautious. The previous week recorded $526 million in ETF outflows, extending the market’s losing streak to eight consecutive weeks. As a result, cumulative withdrawals have now exceeded $8 billion.
Meanwhile, analysts believe the latest rally was driven mainly by forced short covering rather than new spot demand. Furthermore, the Crypto Fear and Greed Index remained at 24, indicating extreme fear among investors. The $62,600 level now serves as an important support zone, while $65,000 stands as the next key resistance level.
