Bitcoin’s $84K-$85K wall: The largest distribution zone to watch
On Sunday, the 11th of October, Bitcoin [$BTC] bounced 1.68% to reach a local high of $84,199. The $84.5k local resistance was not tested.
Across the crypto market, the past 24 hours saw $208.64 million in liquidations, $148.79 million of them positioned short.
Short squeeze and opportunistic buy wall behind Sunday’s move
Bitcoin faced $50.86 million in liquidations, and $42.69 million (83.9%) worth of short positions taken out. The price pushed up toward the cluster of short liquidations around $84k before receding.
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Source: Maartunn on X
Crypto analyst Maartunn observed in a post on X that the bid/ask ratio briefly jumped to 0.3 to show strong buying pressure during the price move into the short liquidations overhead.
Source: Darkfost on X
At $83k, 53% of the wealth invested in Bitcoin was above the market price. Hence, buying $BTC at this level would leave one better off than just over half the $BTC investors, wrote crypto analyst Darkfost.
There were two key clusters to watch out for. The $84k-$85k zone is the largest distribution zone, and investors are expected to react to this zone. A break of this level could be a sign that the trend favored the buyers once again.
Meanwhile, the $77k-$79k and also the $64k-$65k areas to the south were key support zones to watch.
The Bitcoin bull run is only getting started
Source: Axel Adler Jr.
The Bitcoin Young Supply Index has risen from 1.4 to 13.2 since June, as prices rose from $59k to $84k. Higher readings on the metric point to a stronger shift toward younger supply, a sign of new money entering the ecosystem.
The index’s reading was still relatively low, but comparable to the 2015 and 2019 early-stage market recoveries.
Source: Joao Wedson on X
Analyst Joao Wedson used the Realized Cap Impulse scores to highlight that the market was still in an accumulation-to-neutral zone, rather than a bull run underway. There was space for a more sustainable bullish trend to emerge.
Investors need not worry about being late to the bull run – it appears the run is yet to start.
Final Summary
- The Bitcoin price surge above $84k on Sunday was driven by a sudden uptick in buying pressure targeted at taking out a cluster of overhead short liquidations.
- Short-term caution is still the play, but in the long term, the bull run has yet to get going properly.
