Bitcoin Futures Oscillator Indicator Shows Accelerating Long Position Liquidation Pressure

rekt_but_resilient · 2026-02-12T14:07:58+00:00

The Bitcoin futures market's oscillator indicator reveals significant warning signals for participants, indicating extreme pressure on long-position holders with recent liquidations reaching 97%. The clearing dominance oscillator shows systemic pressure on buyers, highlighting a shift in market structure favoring shorts. Despite high liquidation rates, positive funding rates suggest lingering demand for long positions, indicating potential deleveraging risks. The market has yet to complete its clearing process, necessitating close monitoring of the balance between clearing pressure and funding rates.

rekt_but_resilient

2026-02-12 14:07:58

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Oscillator indicators in the Bitcoin futures market are sending important warning signals to market participants. According to the latest data from the liquidation dominance oscillator, long position liquidations reached 97% yesterday, indicating that holders of buy positions are under extremely high pressure.

Market Structure Changes Indicated by the Liquidation Dominance Oscillator

According to Odaily, the 30-day moving average of this oscillator has risen to 31.4%, revealing that nearly all forced liquidations in the market are originating from long positions. Over the past month, buyers have continued to face systemic pressure.

The liquidation dominance oscillator is a key indicator that visualizes these market dynamics. The figure suggests that the market structure is shifting unfavorably toward long positions, not just a temporary price decline. Price movements and chain reactions of liquidations are interacting to create further selling pressure.

Continued Positive Funding Rates Indicate Deleveraging Risks

An interesting point is that, despite large-scale liquidations, the funding rate for Bitcoin perpetual contracts remains positive. Yesterday’s data shows an annualized rate of 43.2%, indicating strong demand for long positions still exists in the market.

While this figure has decreased from peaks exceeding 100% seen between October and November, it remains at a very high level. Maintaining a positive funding rate amid significant liquidations suggests increasing deleveraging risk. This implies that long positions are either rapidly recovering or have not been fully liquidated.

Path Toward Complete Liquidation in the Derivatives Market

Currently, the funding rate has not shifted into a neutral or negative zone. Both the oscillator indicator and funding rate data suggest that the derivatives market has not yet completed a thorough liquidation process.

Market participants need to monitor how long this unstable balance of liquidation pressure and positive funding rates persists, and how much additional liquidation minor volatility might trigger. The trend of the oscillator strongly indicates that the market is still in the middle of a liquidation cycle.

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