Bitcoin News: Bitcoin Liquidations Hit $1.7B as BTC Price Falls to $112K — What’s Next?

Key Takeaways:Bitcoin dropped to $112,000, triggering $1.7B in liquidations, the largest long wipeout of 2025.Analysts are split: some expect a rebound above $116K–$118K, others warn of a slide toward $100K.The Fed’s PCE inflation report and Powell’s speech could spark fresh volatility this week.Rumors of a major U.S. political Bitcoin announcement are circulating online.On-chain metrics show a “pre-euphoria” phase, historically preceding bull market tops.Bitcoin (BTC) fell to $112,000 on Sept. 22, marking one of the sharpest drops in weeks and fueling the largest long liquidation event of 2025. Data from CoinGlass shows more than $1.7 billion in crypto positions were liquidated in 24 hours, with longs making up $1.62 billion.The sudden downturn erased nearly $2 billion in open interest, shaking confidence just as the market was gearing up for a new monthly close.Traders Split: Bounce or Breakdown?BTC is now trading near $112,400, stuck between support at $114K and resistance around $117.2K.Trader Jelle sees the dip as a clean retest, eyeing a bounce to $116K–$120K if buyers hold.Analyst Captain Faibik, however, warns that the breakdown of a rising wedge points to a deeper move toward $100K.Commentator WhalePanda noted Bitcoin’s weakness compared to gold and equities, despite ETF inflows and fresh MicroStrategy purchases.Record Liquidations Shock MarketThe scale of the wipeout caught many off-guard. Glassnode data shows that liquidation clusters were heaviest around $113K–$114K, leaving leveraged longs especially vulnerable.“Now we wait and look for strength within the chaos,” said trader Daan Crypto Trades, adding that the flush may reset conditions for the next major move.Still, some warn of another sweep lower. Investor Ted Pillows predicts BTC could test liquidity between $106K–$108K before resuming its uptrend.Macro Triggers: Powell and PCE DataAll eyes now turn to the U.S. Federal Reserve. Chair Jerome Powell is scheduled to speak Tuesday in Rhode Island, just days before the release of the Personal Consumption Expenditures (PCE) inflation index, the Fed’s preferred gauge.Markets currently price in a 92% chance of another 25 bps rate cut on Oct. 29, but internal Fed divisions — between sticky inflation and labor market weakness — leave policy uncertain.Political Rumors Stir SpeculationAdding to the mix are rumors of a “massive political announcement” on Bitcoin from U.S. policymakers this week. Some speculate it may relate to a Strategic Bitcoin Reserve (SBR), an idea repeatedly floated but never enacted by the Trump administration.Galaxy Digital’s Alex Thorn believes markets are still underpricing the probability of the U.S. formally adopting BTC as a strategic asset.On-Chain Signals Hint at “Pre-Euphoria”Despite the volatility, on-chain data paints a bullish long-term picture. CryptoQuant reports that long-term holder (LTH) profitability is diverging from short-term holders (STH), a dynamic historically seen in the “pre-euphoria” phase before parabolic cycle tops.“The market has not yet reached extreme levels, suggesting significant upside potential remains,” analysts wrote.