Bitcoin Reclaims $80,000 as Stablecoin Demand Signal Starts Cooling
Bitcoin's liquidity backdrop strengthened sharply before the latest rally, but the strongest impulse may already be fading.
Summary:
- Stablecoin demand surged, but the 90-day oscillator is now cooling.
- Bitcoin jumped above $80,800, clearing key short-term resistance.
- Short liquidations reached $333.7 million, accelerating the rally.
- The 4-hour RSI hit 73.3, signaling strong but stretched momentum.
CryptoQuant’s 90-day Stablecoin Supply Ratio Oscillator peaked at 3.74 on August 21, close to the November 2024 spike near 4.00. A higher reading signals stronger stablecoin purchasing power relative to Bitcoin, meaning more crypto-native liquidity is potentially available to buy BTC. The indicator has since started cooling, just as Bitcoin surged above $80,000.
Stablecoin buying power surged before Bitcoin’s breakout
CryptoQuant’s 90-day Stablecoin Supply Ratio Oscillator climbed to 3.74 on August 21, entering the Strong stablecoin purchasing-demand zone.
The signal strengthened while Bitcoin was still struggling to establish a sustained recovery, showing that available stablecoin buying power was improving before price finally broke higher.
The latest development is the retreat from that peak.
The oscillator remains elevated compared with the negative readings seen earlier in 2026, but the direction has changed. Stablecoin purchasing power is no longer accelerating at the pace seen in August.
That gives traders a useful confirmation signal for the next phase.
If the oscillator stabilizes inside the elevated demand region, Bitcoin would retain a supportive liquidity backdrop even without another extreme reading. A continued decline below the High stablecoin purchasing-demand zone would suggest the August spike was closer to a temporary liquidity impulse than the start of a durable demand regime.
Bitcoin finally responds with a break above $80,000
Price has now caught up with the earlier liquidity signal.
That is a gain of roughly 3.7% within the current candle.
More importantly, BTC has cleared several levels that repeatedly limited rebounds over the previous week. The move broke through $78,000, the local resistance around $78,800-$79,000 and then $80,000 in quick succession.
The broader crypto market is participating as well. Total market capitalization reached roughly $2.71 trillion, up 4.38% over 24 hours in the latest market snapshot. Ethereum gained 4.35%, BNB 5.19%, Solana 5.81% and XRP 9.07%.
The breadth supports the recovery, but the speed of Bitcoin’s move leaves little established support between the upper-$77,000s and current prices.
Short squeeze adds fuel to the rally
Derivatives positioning helps explain why BTC moved through resistance so quickly.
According to Coinglass, roughly $416.4 million in crypto positions were liquidated, including $333.71 million in shorts and $82.69 million in longs.
Short positions therefore represented around 80% of total liquidations.
At the same time, aggregate open interest fell 8.3%.
Rising prices alongside falling open interest are consistent with leveraged positions being flushed rather than traders immediately rebuilding aggressive long exposure. Once Bitcoin began clearing resistance, forced short covering likely amplified the move.
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That can strengthen an initial breakout, but it cannot sustain one indefinitely.
With a large portion of vulnerable shorts already removed, the next leg increasingly depends on spot demand and fresh capital entering at higher prices.
RSI at 73 shows momentum is already stretched
Bitcoin’s 4-hour Relative Strength Index has jumped to 73.3, moving above the conventional 70 overbought threshold.
The RSI moving average remains much lower at approximately 45.4, highlighting how abruptly momentum changed during the latest candle.
An RSI above 70 does not automatically signal a reversal. Strong breakouts can remain overbought for extended periods.
It does make chasing a vertical move less attractive.
BTC has climbed almost $3,000 from the current 4-hour candle’s opening level without a meaningful retest. A period of consolidation above former resistance would provide stronger technical confirmation than another immediate spike.
$80,000 becomes the first test
Bitcoin is already approaching its next resistance around $81,000.
A sustained break above that level would expose approximately $81,500-$82,000. Beyond $82,000, attention would shift toward the heavier $83,000-$86,000 supply region.
The more useful test may come on the downside.
$80,000 is now the first level buyers need to defend. A controlled pullback that holds around this area would begin turning former resistance into support.
If $80,000 fails, the $78,800-$79,000 region becomes the next important retest zone.
A deeper move below roughly $77,500-$78,000 would weaken the breakout considerably, particularly if it coincides with further deterioration in the stablecoin oscillator.
The larger $76,200-$76,400 region remains the structural support that protected BTC during the latest correction.
What would confirm another leg higher?
Bitcoin now has price momentum, broad market participation and a large reduction in bearish leverage. The missing piece is evidence that demand can persist after the initial surge.
Three signals stand out:
- Price: BTC holds $80,000 or successfully retests $78,800-$79,000.
- Stablecoin liquidity: The 90-day oscillator stabilizes while remaining in an elevated demand zone.
- Leverage: Open interest rebuilds gradually rather than immediately returning through aggressive leveraged longs.
The current setup does not require another explosive candle to remain bullish. Consolidation above newly reclaimed resistance could provide healthier confirmation.
Bitcoin has already responded to the strong stablecoin liquidity impulse that developed in August. With the oscillator now cooling and RSI above 70, the market is entering a different phase.
The next signal will come from what happens after the breakout. Holding $80,000 while stablecoin purchasing power remains elevated would support a move toward $82,000 and potentially the $83,000-$86,000 supply zone. Losing the breakout as the oscillator continues to weaken would instead suggest that liquidity and short covering drove more of the rally than durable new demand.
The information presented in this article is intended for informational purposes only and should not be interpreted as financial, investment, or trading advice. Coinspress.com does not promote or advocate for any particular investment strategy, asset, or cryptocurrency project. Cryptocurrency markets are highly volatile and unpredictable – always perform your own research and seek guidance from a qualified financial professional before making any investment decisions.
Alexander Zdravkov
Reporter at CoinsPress
Alexander Zdravkov is a market analyst and crypto journalist with interests in economics, broader financial markets and digital assets. His journey into crypto began more than four years ago, driven by a fascination with the rapid evolution of blockchain technology and the transformative potential of decentralized finance. He began analyzing market cycles and identifying emerging trends before they reach the mainstream. He holds a degree in International Relations - a background that helped shape his broader perspective on global economics, geopolitics, and the interconnected nature of modern financial markets. Whether covering the latest developments in the crypto sector or exploring broader macroeconomic themes, Alexander focuses on giving readers context rather than simply repeating headlines. During his career, he has authored more than 10,000 articles covering cryptocurrencies, traditional finance, and global market developments. His work spans everything from Bitcoin and altcoins to macroeconomic trends influencing risk assets worldwide.
