Futures Markets as the Main Driver of Short-Term Price Action

Who is selling their Bitcoin? Was anyone else asking that question when the price cratered down to 60,000? When this post went out, it had 148,000 views in just a few hours, because everyone is asking the same question when the price crashes like this. Who is selling the Bitcoin? Is it the ETFs? Is it something serious? Is it a whale? Is it some government wallet dumping coins all at the same time?

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Everybody wants to know, and this is why posts like this get so much engagement. But everyone is asking the wrong question. The question is not who is selling the Bitcoin. The question is why is the Bitcoin being sold? That is what we are going to explore in this presentation.

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First, we need to understand that this is an algorithmic market. Pretty much all markets are in 2025. Equities and stocks are now 70% to 80% algorithmic. Forex is nearly as high as 90%. Commodities are moving up slowly. U.S. Treasuries and bonds as well. But take a look at this: Bitcoin is 95% algorithmic.

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This algorithmic trading is happening in the futures and derivatives markets because this is where speculation exists. This is where leverage is used. It is my argument that these marketplaces, the algorithms in the futures and derivatives markets, are the main drivers of short-term price action. I am going to prove it to you.

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We are going to start by looking at October 2025. Have a look at this candle here. It is a gigantic move in one single candle. There is nothing organic about that kind of price movement. In order to see it better, we have to put on our X-ray vision.

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What I have done here is turned on the 25x leverage, and I have shown you what the open interest looked like at that given moment. What we are looking at here is a lot of leveraged traders with huge positions, hugely leveraged positions, and a cluster of stop losses that has built up over time.

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What you can see here is a move that wiped them out completely. Put another way, they were hunted. They were hunted by machines. They were hunted by algorithms. You can see that as soon as it got to the bottom of the pool, the price bounced up and consolidated.

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So what drove the short-term price action here? Leverage. People speculating on price using huge amounts of leverage. Then the market makers, the algorithms, and the institutions are designed to take them out.

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The thing about algorithms is they cannot be reasoned with. We cannot beat them. They do not sleep, they do not eat, and they are coming for you if you are in the futures market. If you are trading using any kind of leverage, you are a target.

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I will prove it to you two more times. November 2025. Here we had the all-time high at 124,000, and we had the market crash down all the way to 80,000. The 25x leverage had already been taken out. Let’s put on our glasses again and add the 5x and 10x leverage.

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These are more conservative leveraged traders. They are only using 5x or 10x. But the problem is there are a lot of them all around the world. What we have here is a huge pocket of liquidity that has built up over time. What we see here is that the short-term price action is designed to take out those stops. It is designed to sweep that liquidity.

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That is why the bottom of that wick ends at the bottom of the liquidity pool. That is where the selling stopped. Once the selling stopped, once the leverage was taken out, the market rebounded and started to consolidate again. So the derivatives, the speculation in the futures market, are what drove that sort of price action.

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It is where the open interest peaks and the liquidations start to cascade. When the liquidations start to cascade, price starts to collapse. It all happens very quickly. The spot selling can happen after the move has occurred because now the panic has set in. People start moving their money, and the topic changes. But what happened here was driven by leverage.

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We were down to 84,000. I showed you the tweet at the beginning. The price dropped to 60,000. So what happened there? Again, just to remind you, the algorithms do not feel sorry for anyone who lost money. They do not feel sorry if you get wiped out. They do not feel sorry if you get liquidated. They do not care if your stop loss is hit. These are machines that are designed incredibly well to do their job incredibly efficiently. This is what institutions are running.

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One final time, let’s look at the liquidity. We are going down to the last bottom that we had, close to 60,000. Look at the movement here. We had already taken out the 5x, 10x, and 25x. Surely the people using only 2x leverage are going to be safe, right? Well, no. That was actually the biggest liquidity pool that existed. You can see it right there.

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Where did the wick stop? Right at the bottom of the largest open interest peak. These candles are extremely aggressive. They are hunting and stopping everyone out. Then again, we move back into consolidated price action, a much more natural version of price movement.

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That is the 3x leverage. There is nothing lower than that. That is it. Everyone got wiped out: 25x, 10x, 5x, and now 3x.

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For these market makers, and if we wanted to name names, Wintermute, Jump Trading, and exchange market makers, this is what you see as a retail trader: you see a price chart. This is what they see: a treasure map. It is an absolute gold mine for algorithms.

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What they see is the liquidity and volume profiles you saw before, and they are designed to hunt the clustered stops like machines do. These clustered stops are targets. They are being hunted. The algorithms go to the greatest clusters, and they will find their way there. The algorithms always behave in the same way.

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The problem is we rarely see what they see, because the algorithms can read the order books all at once. They have all that data and all that information coming in, and they are working off it instantaneously. So retail is basically getting eaten alive.

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Again, if you have Bitcoin in cold storage, it is a different thing. That is long-term fundamentals. You are a hodler. But the majority of the trading happens in the speculative futures markets. That is just the reality of it. Bitcoin is one of the most highly traded assets as well, and this asset is being traded 24/7 all around the world in every single marketplace.

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Some of these exchanges allow people to use up to 500x leverage. 150x leverage is normal on some of these platforms. With this kind of leverage and this kind of speculation, how can we not expect this kind of violent behavior? We all know that in the last six months it has been incredibly violent if you have been watching Bitcoin.

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Who do you think is going to win in this game? Do you think it is going to be someone with an algorithm, or someone without an algorithm?

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When you have an algorithm, it is reading the order book in seconds. Next, it is executing without emotion or hesitation at all. It is also already positioned before the moves happen because it is engineered to behave in this way. It is not reacting in the moment. It is designed to absorb the whole universe of potentiality.

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When you are trading in these markets without an algorithm, you are essentially reacting to moves that have already happened. By definition, as a human being, you are emotional, slow, and predictable. This is true for every single market. It has always been true of markets. The point is that in Bitcoin, it is simply impossible to ignore the behavior of these algorithms in the markets. When you are watching, it is so obvious. You saw before, when we put on our liquidity glasses, how that happened.

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If you are not running an algorithm, you really are going to be a victim eventually of the ones that are.

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This is a visual of a year. The last time we were in price discovery, when we had the last breakout, was over here. You can see that two things happened once we started consolidating price. We built liquidity pools on the top side and the bottom side: longs and shorts. Everyone is using leverage. Everyone is using stop losses.

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This is the open interest. The algorithms are going to read the book, find the thin side, and take it out. Bang, bang, bang: 25x, 10x, 5x, 3x.

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Based on what you have seen so far, where does it look like price is going to go? Probably somewhere here. That is where the algorithms are going to profit from all the buying and selling they have just done. They have made everyone here sell. On the short side, when the market starts to move up, these will all be liquidated shorts.

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What is interesting is that you can see we already have 25x, 10x, 5x, and 3x built into the treasure map. I do not want to predict where price is going. Just take a look at that yourself. I find this very interesting.

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So, having understood all this, what would be the right question to ask? How do I get one? Because when you have an algorithm, you can play against the algorithms. You can trade with an algorithm. You can move like an algorithm. You can get your own machine to do the trading for you.

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The real question is, do you have an algorithm that is going to profit either way? Whether Bitcoin goes up or whether it goes down, you should be in a position to benefit. Just like the algorithms. The market makers do not care if Bitcoin goes up or Bitcoin goes down. They are going to make money either way because that is what they are designed to do.

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To be honest with you, the more volatility, the better for them. The deeper the crashes, the better. The bigger the boom-and-bust cycles, the more money they are going to make. Most people do not have the edge, and that is the edge: having an algorithm that can make a profit either way.

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To do this, you want something that has volatility capture. You do not want something that is guessing where the price is going. You want to engineer profit from swings on either side. You do not want to hide from them.

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You also want something that is fully automated, which means no manual intervention. You do not want to have to get up at 2:00 in the morning and make changes. You do not want to have to interrupt your holidays to trade. It needs to already be doing it. It cannot hesitate, ever. It cannot be afraid of a price crash. The algorithm is not.

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You also want precision. You want structured entries, defined exits, and clever positioning. When you have a tool like this, you can enter the futures battleground with something that is going to help you survive an environment that is designed to take you out.

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If you are interested in learning more about how to get an algorithm, walk straight down to the Minotaur Trading Systems booth, and we will give you a full demo of how our trading algorithms and automation work. Thank you.