Bitcoin’s $84K-$85K wall: The largest distribution zone to watch
Short-term caution is still the play, but in the long term, the bull run has yet to get going properly.
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.
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.
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
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.
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.
