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

A major short squeeze occurred in a single session, with Bitcoin reaching $78,000 on Friday and triggering $762 million in liquidations across 168,336 traders. However, by Saturday evening, Bitcoin had fallen back to $76,091, representing a daily increase of only 0.8%. This decline was prompted by Iran's decision to close the Strait of Hormuz to maritime traffic once again, less than 24 hours after its foreign minister declared it fully open. The closure was reportedly in response to a U.S. blockade of Iranian shipping, with state news agency Nour stating that Hormuz had returned to 'strict management and control by the armed forces'. The initial reopening of the strait had led to a $590 million shorts rout, with bets on Bitcoin accounting for $381 million in liquidations. The funding rates on Bitcoin perpetuals had been pinned negative for weeks, indicating that shorts were paying longs a premium to hold their positions. The setup had been building for weeks, and the Hormuz reopening served as the catalyst that triggered the short squeeze. However, the rally was short-lived, and the market pattern is now familiar, with ceasefire headlines driving a rally, only to be followed by a reversal headline that leads to a forced unwind. The question now is whether the $76,000 zone will hold into Monday's open, and whether a clean weekly close above $76,000 can preserve the structural break.