[DigitalToday reporter Yoonseo Lee] After sliding below $75,000, bitcoin is trying to regain the $77,000 level, and the market is again discussing the possibility of short liquidations up to $80,000.

On May 25 (local time), Cointelegraph reported that some traders viewed the weekend drop as a temporary liquidity sweep. It also said warnings are growing that further liquidations could occur as overall spot demand remains weak and leverage expands again.

Expectations of a peace deal between the United States and Iran are cited as a key variable for markets this week. Bitcoin fell below $75,000 over the weekend, sliding to its lowest level since mid-April, before rebounding to regain $77,000. Market participants are watching whether easing geopolitical risk can revive risk appetite across broader risk assets.

Cryptic Trades, an analysis account on X, formerly Twitter, defined the decline as a "fakeout." The account said bitcoin briefly slipped below a higher-timeframe support zone that coincided with the formation of a low in April 2025, and it judged that short-term momentum could tilt bullish again only if bitcoin regains the daily bull market support band. Trader Daan Crypto Trades also said buyers need to defend that zone to maintain short- and medium-term momentum.

In terms of the near-term price path, the possibility of short-position liquidations was raised. Trader Lennart Snyder described the move below $75,000 as a "positive move." Another trader, CW, said bitcoin has risen to just ahead of an area where high-leverage short positions are concentrated, and predicted the next upswing could be a process of liquidating short positions.

Still, the macro backdrop did not immediately translate into a bitcoin rally. U.S. stock futures jumped at the start of the week, and the S&P 500 and Nasdaq 100 set new record highs. Japan's stock market also rose 3.5 percent. Bitcoin, by contrast, continued to show a relatively muted reaction compared with the stock market rally, following the previous week. Analyst Michaël van de Poppe said, "Bitcoin is ready to go to a higher price range," and predicted it could rise above $80,000 if an agreement materialises.

The April personal consumption expenditures (PCE) price index, due later this week, is also a burden factor. With higher oil prices adding to inflation pressure, the Federal Reserve and markets will check the first PCE reading under new chair Kevin Warsh. Mosaic Asset Company pointed to remarks last week by Fed Governor Christopher Waller that inflation is not moving in the right direction and the possibility of further rate increases cannot be ruled out. CME Group's FedWatch measure also showed limited expectations for rate cuts before 2027.

Supply and demand indicators sent a more cautious signal. CryptoQuant contributor Darkfost said bitcoin inflows into Binance continued for about 10 days, and the weekly average inflow rose to 1,190 BTC from 378 BTC. Binance's bitcoin holdings also increased by 16,000 BTC in a month. Rising inflows into major exchanges are traditionally interpreted as a potential sell signal.

Weak U.S. demand is also a drag. The Coinbase Premium Index recorded its biggest negative reading in recent months. U.S. spot bitcoin exchange-traded funds (ETFs) saw cumulative outflows of more than $1.74 billion. CryptoQuant contributor XWIN Japan noted that, as the indicator is considered a proxy for U.S. institutional spot demand, it suggests buying activity by large investors has weakened.

At the same time, a drop in stablecoin trading volume was presented as a signal of weakening market liquidity and risk appetite. Traders still in the market are aggressively building long positions, and funding rates remain positive. Open interest, however, is still below the peak seen in the second half of 2025. XWIN Japan analysed that the recent rebound suggests greater reliance on leveraged futures trading than on strong spot demand.

Ultimately, the bitcoin market this week is increasingly likely to unfold as a standoff between the potential for a rebound on peace-deal expectations and liquidation risks driven by ETF outflows, weak U.S. demand and crowded long positioning. The market is focusing less on attempts to regain $80,000 than on whether the process is supported by actual spot buying.