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

One of the most substantial short squeezes of 2026 took place within a single session, as Bitcoin surged to $78,000 on Friday, triggering $762 million in liquidations across 168,336 traders, with $593 million of that amount being attributed to short positions, according to CoinGlass. However, by Saturday evening, Bitcoin had retreated to $76,091, marking a mere 0.8% increase for the day, as Iran declared the Strait of Hormuz closed to maritime traffic once again, less than 24 hours after its foreign minister announced the waterway's reopening. This development led to a $590 million rout of short positions, with Bitcoin accounting for $381 million in liquidations, followed by Ether at $167 million. The short-heavy breakdown in this liquidation event was the most pronounced since February, with shorts outweighing longs by nearly four to one. The setup for this event had been building for weeks, with funding rates on Bitcoin perpetuals remaining negative, indicating that shorts were paying longs a premium to hold their positions. The initial reopening of the Hormuz Strait on Friday served as the catalyst for the short squeeze, as crude oil prices plummeted nearly 10% to $85.90 per barrel, and Bitcoin broke above the $76,000-$78,000 zone that had capped every rally attempt since the February 5 crash. Nevertheless, this momentum was short-lived, as the market pattern of a ceasefire-driven rally followed by a reversal headline has become all too familiar. The forced unwind of positions has created another setup for the market to work against, with the question now being whether the $76,000 zone can hold into Monday's open. A clean weekly close above $76,000 would preserve the structural break, even if the peace trade continues to whipsaw the market. Conversely, a loss of this level would send Bitcoin back into the same range it has been trapped in since March, albeit with the short base that just got wiped out looking to rebuild.