Bitcoin (BTC) appears to have found a local bottom, signaling potential bullish momentum as Q4 unfolds. After a brief touch at $66K, BTC corrected, leading to growing speculation among traders that the broader cryptocurrency market may be primed for a rally before the end of the year.
A key factor supporting this optimism is the shift in borrowing behavior. Data from Hyblock Capital reveals that traders are now borrowing USDT during price dips rather than borrowing BTC during price pumps. This pattern suggests a growing confidence in buying the dip, increasing Bitcoin exposure—a potential precursor to a bullish run in the coming months.
Bitcoin Breaks Market Structure
Bitcoin’s price action aligns with this positive sentiment. After experiencing a significant sell-off and long liquidations, BTC’s market structure broke, pushing the price down to form a higher low. This correction has given Bitcoin a chance to stabilize and build momentum for a potential upward move.
To confirm a bullish trend, Bitcoin must break through key resistance levels. The next targets include the Daily 200 Moving Average (200MA) and surpassing last week’s highs. If BTC can achieve this, analysts suggest the $70K level will become the next critical milestone. A breakthrough here would solidify the bullish outlook for the remainder of Q4.
Metrics Support Positive Sentiment
Additional technical indicators are also flashing positive signals. Two critical metrics, the Bitcoin Short-Term Holder MVRV and SOPR, are currently retesting their neutral “1” line. If they bounce from this level, it will likely validate a more bullish trajectory for Bitcoin. Such a rebound would reward both short-term traders looking for immediate gains and long-term holders eyeing new highs.
These metrics suggest that the current price action is not just a fluke but part of a larger trend that could push Bitcoin into a more bullish phase as the year progresses.
Another key element driving Bitcoin’s price outlook is the liquidity heatmap, which shows where the highest levels of buy and sell orders are concentrated. According to Coinglass, a massive amount of liquidity is resting between $63K and $66K. Since price movements often gravitate toward areas of high liquidity, this suggests that Bitcoin could be on the verge of a short squeeze—a rapid upward movement as traders rush to cover their short positions.
While there is some liquidity below $60K, it is far less concentrated, indicating that the path of least resistance is upward. This could mean that Bitcoin is poised for a breakout, potentially pushing the price beyond $70K if the current momentum holds.
Is Bitcoin Gearing Up for a Strong Finish?
With several bullish indicators aligning, Bitcoin appears well-positioned for gains as Q4 progresses. Increased USDT borrowing, the establishment of a local bottom, and liquidity dynamics all suggest that the market is primed for a move upward.
If Bitcoin can overcome resistance and capitalize on the current momentum, the $70K level could be within reach before the end of the year. Traders who have positioned themselves for this next leg up may find themselves rewarded, while long-term holders could see Bitcoin approaching new all-time highs in 2024.
As always, investors should stay cautious, but the outlook for Bitcoin seems increasingly bullish as the final quarter of the year unfolds.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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