Analysts: This morning's decline is a typical "plunge to clear leverage" market condition. If the volume of forced liquidations continues to decrease, it indicates that the deleveraging process is nearing completion.

On January 19th, CryptoQuant analyst Axel posted on social media that between January 13th and 15th, the "Bitcoin: Advanced Sentiment Index" rose to approximately 80%, an extremely bullish level, coinciding with the price approaching a local high of $97,000. Today, the index has plummeted to 44.9%, breaking below the 50% neutral threshold. Axel explained that the "Bitcoin: Advanced Sentiment Index" is a composite index that integrates volume-weighted average price, net active volume, open interest, and the difference between long and short volume. Breaking below the neutral line signifies a shift in market structure and a deterioration in risk quality. A return above 50% and sustained stabilization would be the first sign of market stabilization; a further decline towards the 20% bearish level could trigger a deeper correction. During the early hours of today's decline, liquidations exceeded $205 million in a single hour. The spot oscillator surged to +97.96%, indicating that forced liquidations were almost entirely driven by long positions. The scale of these liquidations suggests that they were forced rather than proactive selling, a typical "leverage-clearing" pattern in an overheated market. If the volume of forced liquidations continues to decline in the coming hours, it will indicate that the deleveraging process is nearing completion.