Bitcoin Enters Late Deleveraging Stage as OI Plunges to $29B: Will BTC Bottom Out Soon?

Bitcoin has entered one of the sharpest deleveraging phases of the year, with price, derivatives metrics, and liquidation data all pointing to a late-stage washout rather than a sustained wave of new bearish positioning. The key question now is whether this forced-seller environment is bringing BTC closer to a local bottom — or if deeper volatility is still ahead.

This piece is powered by Outset PR, a data-driven crypto PR agency using market intelligence to decode current trends. It analyzes on-chain and derivatives data daily to map market sentiment and guide timing and narrative strategy for its clients. Below is a breakdown of Bitcoin’s current state and price outlook, based on the market signals.

BTC Price Drops 31% Paired With a 37% Open Interest Collapse

Since early October, Bitcoin has fallen from around $123,000 to $85,839, breaking decisively below its medium-term trend structure. Over the same period, BTC futures open interest (OI) dropped from $46 billion to $29 billion — a steep 37% contraction as per the data from Cryptoquant.

When price declines while open interest rises, it often signals the buildup of aggressive short positions. But in this case, both price and OI fell sharply, indicating widespread position unwinding, not an influx of new bearish leverage.

In other words, traders didn’t “short the top” — they were forced out as volatility increased and risk appetite evaporated.

Long-Term Trend Structure Breaks Down

Bitcoin currently near $85,000 trades well below its major trend markers, as the 100-day SMA lies at 109,658, and the 100-day EMA is found at 105,980.

Trading 20–28% under these moving averages shows that BTC broke below the trend floor that held for months. Market momentum is firmly bearish until BTC reclaims at least the 100-day EMA.

A prolonged distance between price and these moving averages often reflects a market exiting a period of excessive risk-taking and recalibrating around lower volatility and reduced leverage.

A Spike in Liquidations Signals Forced Sellers in Control

The liquidation heatmap on Coinglass shows that over 110,000 traders were liquidated in the past 24 hours.

Total liquidations reached $219 million, and the largest single liquidation on BTCUSDT amounted to $1.75 million on Bybit.

These figures are sizable but still below the $500M–$1B liquidation spikes seen during true capitulation events. This suggests a controlled but persistent flush of overleveraged positions.

Instead of an aggressive wave of shorts, the market is experiencing deleveraging, where longs are liquidated and overall futures exposure declines. This aligns with the fall in open interest and the drop in price.

Momentum Indicators Point to Exhaustion, Not Renewal

While trend metrics remain bearish, momentum indicators suggest the downside might be entering its late phase.

Bitcoin’s RSI (14) sits at 28, marking oversold conditions. Historically, RSI below 30 appears near the end of a strong selling wave. The Momentum (10) indicator at −8,661 reinforces this: sellers remain in control, but the intensity of the move suggests the decline is maturing rather than accelerating.

The MACD (12/26) level at −5,942 shows a deeply negative trend, but MACD typically lags RSI. When RSI becomes oversold ahead of MACD flattening, markets often enter a stabilization zone before momentum eventually shifts.

What a Late-Stage Deleveraging Phase Means for Bitcoin

Taken together, the data describes a very specific market environment:

• Trend: firmly bearish

• Momentum: deeply oversold

• Open interest: wiped out

• Volume: spiking

• Liquidations: significant but not extreme

This is the textbook profile of a late-stage deleveraging phase — one where forced sellers, not fresh bears, drive the move.

Historically, these phases set the stage for stabilization and relief rallies, but rarely mark a final cyclical bottom. Instead, the market seeks equilibrium after leverage is flushed, then forms a base before attempting trend recovery.

Where a Potential Bottom Could Form

At the moment, Bitcoin has met the criteria for leverage exhaustion, but not yet for trend reversal.

Support levels to watch are:

• 82K–85K: short-term liquidity zone

• 78K–80K: next structural support

• Resistance: 92K–95K, then the 100-day EMA near 106K

Until BTC reclaims the EMA cluster around 105K, the broader trend remains under pressure.

About Outset PR

Outset PR is a rare agency in the crypto industry that combines on-chain intelligence, media analytics, and narrative engineering to craft high-impact PR campaigns. Founded by crypto PR strategist Mike Ermolaev, Outset PR operates like a hands-on workshop, building each campaign around market fit and verifiable outcomes.

Our approach is built on:

• daily market analytics

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The result: PR with market momentum baked in, where articles outperform their original placement and gain organic traction across aggregators, including platforms like CoinMarketCap and Binance Square.

This analytical perspective is at the core of how Outset PR interprets the market and how it helps clients align their narratives with the cycles that matter.

BTC Price Outlook: Stabilization Likely, Trend Recovery Less Certain

Bitcoin’s current condition suggests that:

• The fastest phase of the downtrend is likely behind 

• A relief bounce becomes increasingly probable as momentum resets

• The macro trend remains bearish unless BTC reclaims its long-term averages

• Volatility will remain elevated due to thin liquidity and ongoing repositioning

Markets driven by forced liquidations often overshoot on both sides — first down in deleveraging, then up in short-term retracements.

For now, Bitcoin is in late-stage deleveraging. The next few days will determine whether BTC stabilizes into a base or whether another wave of volatility emerges before a bottom is found.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.