Bitcoin nears $79,000 as $120M in shorts are liquidated

Bitcoin tested the $79,000 resistance level on May 1 after an intraday rally of more than $2,000, reaching a peak of $78,924 around 9 a.m. EDT before trading near $78,300 by 12:30 p.m.

The token rose from just under $76,500 late Thursday to about $77,340 minutes before midnight, then oscillated between $77,000 and $77,500 into Friday morning. A second push produced the intraday high before prices trimmed some gains.

About $120 million in short positions were liquidated on Friday, representing more than half of the roughly $217 million in short liquidations recorded across the crypto market over a 24-hour period.

Bitcoin’s market capitalization increased from around $1.52 trillion on Wednesday to nearly $1.57 trillion on Friday.

Traders linked the price action to reports that Iran submitted a new proposal to Washington through Pakistani intermediaries. At the White House, President Donald Trump rejected the proposal, noting Tehran’s leaders had signaled a willingness to negotiate while internal infighting made a settlement unlikely. U.S. officials described hostilities as ended, and some regional actors warned the pause could be temporary.

The diplomatic reports briefly pushed Brent crude below $110 per barrel. Analysts cautioned oil prices could remain elevated while the Strait of Hormuz faces ongoing military pressure.

Market participants said higher gasoline prices could have political consequences ahead of the midterm elections and could influence sentiment in risk markets.

A Bitunix analyst cautioned that if markets rotate from a soft-landing outlook toward stagflation, or if the Federal Reserve appears to lose policy flexibility, volatility in high-valuation assets could increase and liquidity expectations could come under pressure.

Traders will watch whether bitcoin can sustain levels near $79,000 or if profit-taking and macroeconomic uncertainties push prices lower.