Key Points
- Bitcoin [BTC] shows resilience after a sharp decline, indicating a possible short-term price increase.
- Liquidations, growing ETF demand, and strong whale activity suggest further gains for Bitcoin.
Bitcoin [BTC] has demonstrated firmness following a significant drop caused by geopolitical tensions between Israel and Iran. Currently trading around $62K, BTC shows potential signs of regaining the $63K mark.
The recent liquidation of long positions could have formed a local bottom, suggesting that BTC might be ready for an additional upward move, using this bottom as the month’s low.
Liquidity Levels and Price Action
During substantial declines, long contracts usually fall drastically due to liquidations, thus reducing the selling pressure. Key liquidity levels remained stable between $68,900 and $69,300 above the current price, and $56,800 to $57,400 below.
A new liquidity cluster is also emerging in the $66,500 to $66,800 zone, indicating that the price may target this area shortly. Despite BTC’s price action fluctuating between $55K and $75K for over 200 days, Bitcoin remains in a strong position.
BTC is trading above the 100-week moving average (100MA) on the weekly chart, maintaining strength on the macro level. It’s noteworthy that BTC is now 170 days past the latest Bitcoin halving, and historical patterns suggest that new all-time highs (ATHs) tend to form approximately 1,080 days after the previous cycle’s peak.
Indicators and Demand
The Coinbase Premium tool on CryptoQuant adds to this bullish outlook, highlighting a potential short-term BTC increase. When a golden cross is formed, as shown in previous price movements, Bitcoin often experiences a short-term boost.
Demand for Bitcoin from U.S. spot ETFs has also been rising. In early September, spot ETFs were net sellers, but by the end of the month, they had purchased 7K BTC, the highest level since July 2021.
In the first quarter of 2024, spot ETFs bought nearly 9K BTC daily, pushing prices to new highs. If this buying trend continues, Bitcoin’s price could rise even further in the final quarter of 2024.
Moreover, large Bitcoin holders, or “whales,” have shown historically low levels of profit-taking, indicating confidence in future price growth. Whales have been distributing their BTC across different addresses, with only 1,975 addresses now holding between 1,000 and 10,000 BTC.
Despite some recent selling, whales have taken minimal profits compared to previous cycles, further supporting the notion that BTC’s price will rise from here as they seek to maximize their gains.
A combination of liquidations, increasing demand from ETFs, and strong whale activity suggests that Bitcoin is poised for further gains from its current local bottom. All these factors point towards a likely upward trend for BTC in the near term.
