Bitcoin Jumps Back Above $81,000 as a Short Squeeze Follows the Democratic Sweep, With $560 Million in Shorts Liquidated
A fall to $75,618 shortly before midnight turned into a 7 percent rebound once Congress was called, but ETF money is still leaving and Bitfinex says the floor under $77,000 is built on leverage.
Wednesday, November 4, 2026/3 min read
Bitcoin spent the count going down and the morning after going up. It slid from near $78,000 to an intraday low of $75,618 shortly before midnight Eastern on election night, by Bitstamp's data, then took almost eight hours to recover $3,000 and under an hour to add the next $3,000. By 12:35 p.m. Eastern on Wednesday it traded around $80,335, up nearly 4 percent on the day, after touching $81,105, its first print above $81,000 since 29 October, Bitcoin.com News reported.
The mechanics were a squeeze. Coinglass counted more than $974 million of crypto liquidations in the 24 hours to 1:21 p.m. Eastern, over $563 million of it short positions; for bitcoin alone roughly $307 million of shorts and $96 million of longs were wiped out. Yesterday we had bitcoin at a two-month low of about $76,500 with Binance's emergency fund shown half spent; the election removed one uncertainty and traders who had sold the event paid for it.
Fortune's 7 a.m. Eastern snapshot, before the bulk of the move, had bitcoin at $78,520, up about 2 percent on the day but still 7.3 percent below a month earlier and 22.6 percent below a year ago, with ether at $2,330 and XRP at $1.28, per Fortune.
Why did bitcoin rise after Democrats took Congress?
Relief, mostly. Crypto.news noted overnight that NBC News had projected Democratic control of both chambers while some races were still open, and that the market had already been pricing a correction: Santiment's bull-to-bear comment ratio had dropped to about 0.51 from 1.8 on 20 October, which the firm read as a set-up for a buy-the-news reaction once results were clearer, the site reported. The Binance perpetual funding rate had reached 0.01, its highest in more than two months, a sign of crowded longs before the drop and crowded shorts after it.
Policy is the longer thread. The CLARITY Act, the market-structure bill that stalled in September when a Senate procedural vote fell short of 60, now goes into a Congress run by the party whose members blocked it; crypto.news counted seven Democratic senators who had said they wanted talks restarted, with their objections centred on officials' crypto holdings and the split of regulatory responsibility. Strategy's Michael Saylor urged traders not to read the result along party lines, pointing to the winners in Florida's governor race and the Texas Senate race.
Is the rally built on spot buying or leverage?
Bitfinex's analysts say leverage. Futures open interest stood at 701,548 BTC on 3 November, the highest since late September, with annualised perpetual funding near 11 percent, and the firm wrote that the market's underlying support under $77,000 appears heavily leverage-driven rather than backed by spot accumulation. About 353,000 BTC changed hands between $75,000 and $77,000, and a daily settlement below $75,839 would expose a thinner pocket down to $70,000. Options positioning ahead of the CPI inflation report had more than twice as many puts as calls.
The ETF tape agrees. SoSoValue data had spot bitcoin ETFs losing $115.6 million on 3 November after $398.6 million on 2 November, when BlackRock's IBIT alone shed $405.3 million, and $643.3 million on 30 October, so three sessions of withdrawals above $1.15 billion. Aggregate 2026 flows are now marginally negative.
What does the market watch next?
Two things: whether the Thursday session holds $80,000 without a fresh wave of shorts to burn, and the US consumer price report, which the options market has already hedged. The post-hack Binance story has not gone away either; the exchange's proof-of-reserves and fund-replenishment updates remain the other variable under every bitcoin bid this month.
Published in The Outspoken Digest
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