Bitcoin broke above $81,000 after Fed Governor Christopher Waller said he may back rate cuts. This reduced the chances of a September rate hike. As a result, more than $415 million in short positions were closed in crypto derivatives in a single day.Waller’s remark in an interview sparked the momentum. He stated that he would be inclined to support keeping the rate steady if the data on the current level of inflation continued to improve. In less than one hour, rate traders revalued odds of a hike at the September 15-16 meeting of the Fed from 63.2% to 50.4% in the CME FedWatch tool, which evaluates the possibility of central bank actions based on futures prices.The cost of borrowing fell dramatically. The yield on the 10-year Treasury, which had been rising to its highest levels since November 2023, the day before, dropped to 4.73%. It was an impressive turnaround after the previous week when Fed Chair Kevin Warsh had delivered a hawkish keynote at Jackson Hole that had dragged Bitcoin down to $76,877 and lifted hike odds toward 56%.Bitcoin short sellers lose $415MIt’s the short positions traders took for further decline that have been hurt the most. CoinGlass data shows that liquidations exceeded $500 million within a day, with nearly $327 million in short positions liquidated in one hour amid price spikes. More than $164 million in other short liquidations occurred over four hours compared to only $7.3 million in long positions. This together resulted in $510 million in market-wide liquidations. Around $415 million worth of Short bets got liquidated.Not only did Bitcoin benefit from the rally, but Ether neared $2,500, rising by about 2.2% during the day. XRP saw its price rise by around 6% over 24 hours. US stock markets rallied accordingly, with the Dow Jones Industrial Average gaining several hundred points.$83,000 is the line analysts are monitoringNot everybody interprets the bounce in a bullish manner. Some analysts view the current move as a “bull trap” and refer to the rejection at $83,000, a resistive area linked to the supply of long-term holders. Due to the absence of institutional interest in buying spots, analysts believe that the relief rally can turn into a distribution process where momentum traders will provide the liquidity for large players. The level that needs to be taken out is $83,000. Bitcoin has been trying to break that area on multiple occasions throughout 2026, but has not been successful.Bitcoin price is up by almost 6% in the last 24 hours. BTC is trading at an average price of $81,608 at the press time.If you're reading this, you’re already ahead. Stay there with our newsletter.