It spiked to $81,240 during trading, hitting a three-month high! But it quickly fell back below $79,000, triggering another round of long-and-short liquidation chaos. The Fear and Greed Index surged to 83, entering "Extreme Greed" for the first time in 616 days—history has repeatedly shown that when sentiment is at its most feverish, danger is often at its peak.

01 Spike and Retreat: The $81,240 "Drive-By"

Bitcoin staged a classic "spike-and-retreat" performance today.

On August 25, Bitcoin and the broader crypto market extended last week's gains, with intraday prices peaking at $81,270.5, breaking through the $81,000 mark for the first time since May this year. Some exchange data showed Bitcoin briefly hitting $81,240.68.

However, the price failed to hold above $80,000. As of the morning of August 26, Bitcoin had retreated to $79,024, a pullback of over $2,000 from its peak. Midday data showed Bitcoin briefly dipping below $78,000 USDT before engaging in high-level, active consolidation between $78,500 and $79,100.

Bitcoin has risen about 24% over the past week, marking its best performance since 2023. Ethereum gained roughly 30% over the same period, climbing above $2,500. Bitcoin's market dominance rose to 59.68%, with capital increasingly concentrating in the leading asset.

Up to $80,000, then back down to $79,000—bulls and bears are locked in a fierce tug-of-war at this critical level.

02 90,000 Liquidated for $600M: Another Round of Long-Short Carnage

Over the past 24 hours, 91,255 traders globally were liquidated, with total liquidations reaching $621 million—$321 million in long positions and $300 million in short positions. The largest single liquidation order occurred on Bitget, valued at $103 million.

For Bitcoin, long liquidations totaled $119 million, while short liquidations hit $193 million—shorts suffered heavier losses. Ethereum saw $65.09 million in long liquidations and $67.32 million in short liquidations.

One notable detail: Bitcoin's open interest plummeted by 12%, suggesting the short-squeeze rally may be nearing its end.

Meanwhile, a whale address "0x6046," which was just 2% away from liquidation on its short position, closed out 559 BTC shorts at a loss of approximately $810,000, then flipped to a long position worth $34.59 million within just ten minutes, with an average entry price of $80,761.

From short to long, the whale executed a "reverse harvest"—but that $34 million long position now faces its own liquidation risk.

03 Extreme Greed: First Time in 616 Days!

The most alarming signal comes from market sentiment.

The Crypto Fear and Greed Index has surged to 83, entering the "Extreme Greed" zone. This is the first time since late 2024, and the first time in 616 days the index has touched extreme greed levels.

Just a month ago, the index stood at 36 (Fear), and a week ago it was 41 (Neutral). In just 30 days, it has climbed 45 points, nearly erasing all the caution accumulated in the first half of 2026. This is also the only recorded instance of the index jumping directly from "Extreme Fear" to "Extreme Greed."

From extreme fear to extreme greed, the market took only six months—and historically, when sentiment is at its most feverish, risk is often at its highest.

04 Analysts Are Split: Early Bull Market vs. Short-Term Overheating

Bull Camp: Early Bull Market Confirmed

· CryptoQuant: Key on-chain and demand indicators have turned bullish. The Bull Score index jumped from 30 to 80 over the past week, its highest level since October 2025, with 8 of 10 indicators flashing bullish signals. Analysts believe Bitcoin has exited the bear market and entered the early stages of a bull run.

· On-chain analyst Julio Moreno: Bitcoin has officially entered the early phase of a new bull market, with most market indicators pointing to a restart of the upward cycle.

· Joel Kruger, Market Strategist at LMAX Group: The next key level is the May 2026 high of $82,820. A breakout above this would strengthen the case that a cycle bottom has formed, pushing prices toward $100,000 and beyond to the 2025 all-time high.

· Katie Stockton, Managing Partner at Fairlead Strategies: Bitcoin is no longer oversold but has not yet entered overbought territory, leaving room for further upside.

· Fundstrat: Buying following last week's short squeeze suggests Bitcoin's rally may be "more durable than a tactical bounce."

Cautious/Pullback Camp: Short-Term Rally May Be Overheated

· CryptoQuant (also warning): Despite bullish signals, the short-term rally may be overheating. Traders' unrealized profit margin stands at 20.5%, the highest since June 2025; short-term holder whales realized approximately $1.2 billion in profits between August 20-22; Bitcoin exchange inflows have risen to around 53,000 BTC, the highest since June.

· Binance Research: "It would be unwise to simply define this rally as a 'bull market restart' or a 'brief short squeeze.'"

· Ding Yuan, Director of XINHUO Research Institute: Short covering is the direct catalyst, but the magnitude and speed of the rise may not fully represent a comprehensive return of long-term spot buying.

· Analyst Theophiluspep: While Bitcoin has entered a bull market, elevated profit-taking, exchange inflows, and overbought conditions suggest a possible short-term cooldown.

05 Four "Red Lights" Are Flashing

Red Light One: $83,000—The "Life-or-Death Line"

CryptoQuant notes that a weekly close above the 365-day moving average (currently around $83,000) is needed to confirm a true shift into a new bull market. CryptoQuant's Head of Research has characterized the $83,000 level as the "ultimate resistance." $83K is not just technical resistance; it also concentrates a large volume of call options and the need for historical trapped positions to break even.

Red Light Two: Extreme Greed, a Historical Warning

The Fear and Greed Index at 83—"Extreme Greed." Historically, periods when retail FOMO sentiment erupts are often windows of heightened short-term volatility. Just a month ago it was fear; now it's extreme greed—the speed of this sentiment shift is itself a cause for concern.

Red Light Three: Can Spot Demand Take Over?

XINHUO Research Institute points out that the momentum driven purely by forced liquidations has clearly weakened. Whether the rally continues depends on whether spot buying can step in. While ETFs continue to see inflows, "ETFs can sustain upward momentum, but they cannot single-handedly restart a bull market." Derivatives trading volume fell 13.11% from the previous day, indicating that short-term traders are rapidly adjusting.

Red Light Four: Whales Are Cashing Out at Highs

Short-term holder whales realized approximately $1.2 billion in profits over three days, with a record $614 million on August 20 alone. Bitcoin exchange inflows have risen to around 53,000 BTC, the highest since June. Institutions are buying, whales are selling—who is holding the bag for whom?

06 Two Key Dates to Watch

Tonight (August 26): US July PCE inflation data release—could trigger significant market volatility.

August 27-29: Jackson Hole Central Bank Symposium—new Fed Chair Warsh will deliver his first keynote address since taking office.

07 Final Thoughts

Bitcoin surged to $81,240, then fell back below $79,000—at the $80,000 level, neither bulls nor bears are willing to yield.

90,000 liquidated for $600M, the Fear and Greed Index at 83 in extreme greed, and the $83,000 "life-or-death line" looming—every signal tells us: the direction is about to be revealed.

CryptoQuant says "the early bull market is confirmed," but also warns that "the short-term rally may be overheated." The greater the disagreement, the greater the volatility.

$83,000 is the watershed—above it, targets of $100K and $126K; below it, $75K and $65K.

But one thing is certain—the lesson from 90,000 liquidations in the past 24 hours is right before us: in this market with abnormally high leverage, getting the direction right doesn't guarantee profits, but getting it wrong while using leverage guarantees losses.

This article is for market information compilation and analysis only and does not constitute any investment advice. The cryptocurrency market carries extreme risk; invest with caution.