Bitcoin sweeps $60K as $1.2B options risk fuels squeeze bets

Bitcoin fell 3.2% to $59,357 as of 05:00 UTC on June 6, breaching the $60,000 psychological level and sweeping the February lows near $59,930, according to CoinGecko data. The move extended a week-long decline that has erased more than 12% from the largest cryptocurrency by market capitalization.

"The $60,000 level carries more than $1.2 billion in notional open interest tied to put options on Deribit," Jean-David Péquignot, chief commercial officer at Deribit, told CoinDesk. "A break below could force market makers to adjust hedges through short gamma exposure, potentially amplifying selling pressure."

The breakdown follows the loss of the $61,900 point of control on CME Bitcoin futures, a level that had served as the session's key volume reference. Below that threshold, the auction has accepted progressively lower prices, with the next structural support sitting at $61,255 to $61,150, followed by the $60,270 to $60,000 reaction zone, according to market structure analysis. Open interest across aggregated derivatives venues has trended lower during the decline, while perpetual futures cumulative volume delta continued to deteriorate, showing aggressive selling in the derivatives market.

The $60,000 area now represents a critical juncture. The level is both a psychological magnet and a large options concentration point — a combination that historically produces sharp reversals. On the weekly CME chart, Bitcoin is testing its 200-week simple moving average, a level that acted as major support during the 2015 and 2018 bear markets and marked the final capitulation zone before long-term recoveries began. The Relative Strength Index on the weekly timeframe is showing a developing bullish divergence, with price making lower lows while momentum forms higher lows.

Short Squeeze Setup Gains Traction

The combination of extreme bearish positioning and deeply negative spot flows has drawn comparisons to conditions that preceded sharp relief rallies in prior cycles. Spot cumulative volume delta reached extreme negative readings before the selling began to flatten, according to exchange data. Liquidation data shows another significant flush of long positions, removing traders who had remained positioned for a rebound after earlier declines.

Analyst Kaz noted that a successful reclaim of the $62,000 area could trap newly opened short positions and trigger a move toward the next major resistance zone around $68,200. The setup mirrors patterns seen in late 2022, when Bitcoin swept below the 200-week moving average before staging a multi-month recovery.

What Happens Next

For the bearish case to remain intact, Bitcoin must stay below $61,900, the lost POC on CME futures. A sustained break below $60,000 with acceptance would open the path toward $59,500 to $59,170, with deeper washout risk extending to $59,000 and below. However, the concentration of short positions near the round number creates the risk of a sharp squeeze if buyers reclaim $60,000 and hold it through the Asian session close.

The next catalyst comes with the weekly ETF flow prints, which will show whether institutional products absorbed the dip or accelerated the selloff. BlackRock's IBIT and Fidelity's FBTC posted mixed flows through early June after a nine-week inflow streak ended with two sessions of net redemptions above $300 million each.

This article is for informational purposes only and does not constitute investment advice.