Key Points
- Bitcoin [BTC] struggles to break resistance after a September rally, with bearish pressure raising fears of a deeper pullback.
- Whale cohorts holding 1K to 10K BTC are showing confidence in Bitcoin’s future, purchasing over 50K BTC in the last 10 days.
Bitcoin [BTC] is currently facing a critical situation as bulls find it hard to overcome resistance following a rally in September that almost pushed prices to $65K. At present, Bitcoin is priced at $60,480, and the expected repetition of the late July cycle hasn’t come to pass. The bears are retreating while the bulls are setting their sights on the next resistance at $68K.
The bearish pressure still exists and there are concerns of a deeper pullback. If the bulls fail, BTC could possibly fall back to around $55K. However, a significant event has sparked optimism and led to speculation that an influx of demand could trigger a short-squeeze.
Bitcoin Whale Confidence on the Rise
Whale cohorts who hold between 1K and 10K BTC have shown confidence in Bitcoin’s future gains. They have bought over 50K BTC in the past 10 days, which is valued at around $3.14B. Interestingly, this surge in buying coincided with a period when Bitcoin was under pressure from short-sellers after it rose close to $63K. These purchases have helped prevent a significant pullback and have assisted Bitcoin’s ascent towards the $65K resistance.
During the mid-September rally, shorts regained control in the derivatives market and put pressure on BTC for a pullback. However, the accumulation by whales absorbed this pressure and created a situation that is ripe for a short-squeeze. If a similar trend continues, short liquidations could be triggered which could potentially become a catalyst for a significant rebound.
Potential Risk for Short Positions
Currently, a rebound to $61K presents a strong liquidity pocket that holds approximately $40M in leverage. A close near that range could put short sellers at risk, forcing their positions to close and pushing BTC upwards.
Typically, patterns of whale accumulation often coincide with Bitcoin testing a market bottom. According to a report, a retreat back to $60K was essential to shake off weak hands. These are individuals who bought BTC at an earlier support of $55K and are prompted to cash in on their gains and exit the cycle.
The key now is to flip the $60K resistance into support, encouraging new buyers to enter the market. This shift would enable whales to target the market bottom and push BTC closer to $66K. Although net outflows have regained control after three days of rising BTC supply, suggesting that $60K presents a strong buy-the-dip opportunity, a stronger push is needed to confirm a bull rally.
In summary, if bulls can capitalize on this price point with aggressive buying and flip $60K into support, a rebound could push BTC back to $66K. However, if bearish sentiment prevails without any party to absorb pressure, fear could trigger panic selling, allowing shorts to maintain control and potentially pushing BTC down to around $55K. This could set the stage for the next market bottom.