Bitcoin rebounds above $60,000 after $1.6 billion liquidation-driven selloff By Investing.com

Bitcoin briefly fell below $60,000 to as low as $59,100 before rebounding, as stronger-than-expected U.S. jobs data pushed investors to price out Fed rate cuts and drove a broad risk-off selloff. The Nasdaq 100 fell about 5%, semiconductors posted double-digit losses, and roughly $1.6 billion in crypto positions were liquidated over 24 hours, including more than $500 million in Bitcoin. Ether dropped 3.04% to $1,561.25 and is down about 22.8% for the week, while traders are now focused on whether $60,000 holds as support.

Analysis

This is less a crypto-specific drawdown than a cross-asset deleveraging event caused by a regime shift in rates. When front-end yield expectations reprice higher, the first casualties are assets whose valuation depends on abundant liquidity and persistent ETF/retail marginal demand; that makes high-beta crypto, semis, and crypto-linked equities vulnerable in the same tape. The liquidation cascade matters because it creates path dependence: once levered longs are flushed, spot can overshoot fair value for 1-2 sessions even if the macro shock is temporary.

The key second-order effect is that spot ETF outflows remove the natural buyer that had been dampening volatility this year. That means dips are no longer being absorbed by passive demand, so any further downside is more likely to be mechanical rather than fundamental — especially if funding remains elevated and options dealers are still short gamma below round numbers. In that setup, the market can stay fragile for days, but the longer-term damage depends on whether BTC holds the mid-50s support zone; a decisive break would likely force systematic de-risking across the whole digital-asset complex.

Contrarianly, the selloff may be overextended if the jobs data only delays cuts rather than eliminates them. A higher-yield, stronger-dollar regime is bearish for speculative assets, but it also improves the odds that any further weakness in crypto is bought by longer-horizon allocators hunting convexity after leverage is cleared. The most asymmetric setup is not chasing the dip immediately; it is waiting for either stabilization in yields or a failed breakdown below support, because the first rebound after forced liquidation is typically fast but tradable only if downside pressure has already exhausted itself.

Key Decisions for Investors

• Avoid catching the knife in spot crypto for 24-72 hours; wait for either BTC to reclaim the $60k area on improving breadth or for a flush into the next support pocket before adding risk.
• If already long crypto beta, reduce gross and hedge with short IBIT or long put spreads on BTC-related vehicles for 1-2 weeks; the near-term risk is another liquidation wave rather than a slow grind lower.
• Trade the liquidity shock via a short HODL basket against long quality cash-rich mega-cap tech only if yields keep rising; semis and crypto tend to co-move in this regime, but quality tech should outperform on balance-sheet resilience.
• For tactical upside, consider a defined-risk BTC call spread 4-8 weeks out only after a successful hold of support and a reversal in Treasury yields; the reward/risk improves materially once forced sellers are spent.
• If spot ETF outflows persist for another week, cut any thesis that depends on passive crypto inflows and shift to relative-value shorts in the highest-beta altcoins versus BTC, which are likely to underperform in a continued de-risking cycle.