Bitcoin must overcome a resistance zone between $83,000 and $86,000 to maintain its upward trend, facing liquidity challenges and selling pressure.
Bitcoin must navigate a resistance zone between $83,000 and $86,000 to sustain its upward momentum, according to analysts at Glassnode. This area is significant as long-term holders have accumulated approximately 1.07 million BTC around $85,000, which could lead to selling pressure if prices return to this range.
The breakeven point for American exchange-traded funds (ETFs) is also near this resistance, at about $86,000. Although recent price movements have reduced unrealized losses for these ETFs from $18 billion in February to $3.9 billion, they have not fully recovered.
"Bitcoin is still stuck beneath the edge of a thick resistance band," Glassnode stated, emphasizing that a breakthrough could signal a change in market dynamics.
Despite the potential for selling if prices rise, long-term investors have been less active in realizing profits, with their share of total realized gains declining significantly from 88% in August to 47% now.
Should buyers push Bitcoin's price above $82,000, the market could see short liquidations that would further support price increases. Since August 19, the volume of short positions has risen by 21%, indicating potential for forced buying back of positions as prices rise.
Market Liquidity Concerns Persist
Analyst Darkfost from CryptoQuant highlights that the spot market lacks strong buying momentum, contrasting with the futures market where buyers are more active. The 90-day average Cumulative Volume Delta (CVD) remains neutral, indicating weak spot demand.
"Despite a roughly 45% rebound from recent lows, Bitcoin's market is still feeling the effects of low liquidity," Darkfost noted.
While stablecoin reserves on Binance peaked at over $50 billion, they have since dropped by nearly $7 billion. Although there has been a slight recovery of $1.6 billion in the last month, it has not compensated for previous outflows, leaving a negative change of -1.6% over 90 days.
Furthermore, American spot Bitcoin ETFs have seen outflows of $166.8 million over just two days, suggesting limited buying support from these funds.
Outlook: Growth Opportunities and Risks
Despite liquidity challenges, there are signs of improvement in Bitcoin's technical indicators. The daily Relative Strength Index (RSI) is at 67, and moving averages have crossed positively, which some analysts interpret as a bullish signal. Darkfost asserts that a decisive move above $80,000 could restore liquidity in the market.
Currently, Bitcoin trades around $77,700, down 1.4% in the last 24 hours. However, contributor GugaOnChain warns of potential downward pressure if large holders decide to sell during this recovery phase, particularly as the negative premium on Coinbase suggests weak demand in the U.S.
Analysts caution that if the price reverses, it could lead to further liquidation of leveraged long positions, exacerbating the decline.
