Originally published on: October 28, 2024
Bitcoin started the week strong, with a price of $72,412, making a move towards the elusive $70,000 mark. But can we expect it to break through to new all-time highs by the end of today’s trading session?
The resistance zone of $69,000-$70,000 has proven to be a tough nut to crack, as shown by the sell walls displayed on recent charts. Most of Bitcoin’s recent price surges have been fueled by futures market activity and liquidations, and it seems like this trend continues.
A close look at the charts reveals that as the price moved from $67,600 to the daily high range, there was a noticeable increase in funding rates and buy volume. However, sellers were quick to fill their asks as soon as the price hit the sell wall at $69,400.
Futures traders are opening long positions to drive prices higher, forcing short traders to cover their positions and boosting spot volumes and open interest. This tug-of-war between bulls and bears is what’s keeping Bitcoin from breaking out of the $69,000-$71,000 range.
Despite strong purchasing demand in the spot market during price drops, it seems to dry up when Bitcoin nears the range highs, leading to a reversal in price. This lack of spot volume could be the missing ingredient needed for a sustained breakout above $70,000.
According to HighStrike’s head of crypto options and derivatives, JJ, the current sell wall is preventing Bitcoin from making a significant move beyond $70,000. Without a substantial increase in spot purchasing demand, breaking through this barrier may prove challenging.
In conclusion, while Bitcoin shows signs of strength and potential for a breakout, it may need a surge in spot volumes to sustainably push past $70,000. Traders will need to keep a close eye on market dynamics to capitalize on potential opportunities and manage risks effectively.
