$BTC $ETH Bull markets tend to liquidate longs, while bear markets tend to liquidate shorts. Sounds counterintuitive, right? But it’s true. Yesterday, short liquidations hit an all-time record, reaching an astonishing $3 billion. The short-term trend in the crypto space has already reversed, but I don’t agree that the bull market is back just yet. The real reason behind this surge is the recent stagnation in U.S. stocks after hitting new highs, which led to a capital flow back into crypto as investors look for new speculative opportunities. Here’s the breakdown: Over the past while, U.S. stocks have been rebounding strongly, with the S&P 500 even hitting new highs. Meanwhile, the crypto market has been sluggish, with trading volumes and volatility dropping to absurdly low levels. If you’ve been trading, you’ve probably noticed how unusual the trading volume and volatility have been over the past two weeks. Over the last week, as U.S. stocks started to plateau at high levels and lost upward momentum, capital within the market urgently needed a new speculative avenue. Since crypto hadn’t followed the stock market’s rally, it became the perfect destination for this wave of funds. Final thoughts: Expect $BTC to consolidate around the 73-75 range. If it can’t break out with higher volume, it will confirm that this is just a violent bear market rally driven by capital rotation and aimed at liquidating shorts.