BTC Liquidity Zones at $70K and $47K Are Crucial for Price Action
Following the significant liquidity dump on August 5, Bitcoin currently lacks substantial clusters in proximity. The critical liquidity zones are noted at the lower high of $70,000 and the lower low of $47,000.
A breakout above the $72,000 level could propel Bitcoin toward a new all-time high, with traders keenly monitoring these liquidity zones, especially at the lower extremes. Data from Coinglass indicates diminished large liquidity concentrations after key liquidity points were breached on August 5 and September 16.
According to crypto trader Daan Crypto Trades, the Binance BTC/USDT pair has recently eliminated a major liquidity cluster below $50,000 during the August 5 drop. The trader emphasizes that significant liquidity clusters now reside at $70,000 for lower highs and $47,000 for lower lows.
The yearly BTC/USDT Liquidation Heatmap reveals large liquidation clusters at $70,000 and $72,000, with liquidation leverages of $41.51 billion and $39.86 billion, respectively. If Bitcoin reaches these levels, traders with leveraged positions could be liquidated, increasing liquidity and potentially driving prices higher.
Currently, traders hold $1.81 billion in short positions at $65,000 and $993.4 million in long positions at $52,000. If Bitcoin fails to break the key resistance at $65,000, a significant drop could follow, with a critical support level at $57,000.
Should Bitcoin overcome this resistance, it will likely absorb the short liquidations, resulting in a short-term bullish trend. Moreover, successfully breaking the $70,000 and $72,000 thresholds could see prices surge toward a new all-time high around $80,000.
As of now, Bitcoin is trading at $58,634, with a one-day Relative Strength Index (RSI) of 49.80, above the RSI-MA, and a Chaikin Money Flow of 0.05. Additionally, the MACD is above the signal line, collectively indicating a potential bullish trend ahead.
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