Bitcoin Price Drops to $76,000 Following Iran's Reversal on Hormuz Strait

A major short squeeze took place in 2026, with bitcoin reaching $78,000 on Friday, triggering $762 million in liquidations across 168,336 traders, $593 million of which were short positions, according to CoinGlass. However, by Saturday evening, bitcoin had fallen back to $76,091, representing a daily increase of only 0.8%, as Iran announced the reclosure of the Strait of Hormuz to maritime traffic, less than 24 hours after it was declared fully open. This move was reportedly in response to a US blockade of Iranian shipping, with state news agency Nour stating that the strait was under 'strict management and control by the armed forces'. The news led to a reversal of the previous day's breakout rally, which had resulted in a $590 million shorts rout, with bitcoin accounting for $381 million in liquidations, and ether shorts at $167 million. The setup for this had been building for weeks, with funding rates on bitcoin perpetuals pinned negative, indicating that shorts were paying longs a premium to hold their positions. The initial reopening of the Hormuz Strait had been the catalyst for the rally, with crude oil dropping nearly 10% to $85.90 per barrel, and bitcoin breaking above the $76,000-$78,000 zone. However, the rally was short-lived, as the news of the strait's reclosure led to a market reversal, with ether holding up better than bitcoin, down only 0.2% over 24 hours, while solana and dogecoin fell 1.3% and 2.1%, respectively. The question now is whether the $76,000 zone will hold into Monday's open, with a clean weekly close above $76,000 needed to preserve the structural break, despite the ongoing whipsawing of the peace trade.