Bitcoin's long-term liquidity leads to the formation of a local bottom.
A short-term price increase for Bitcoin seems inevitable.
Bitcoin [BTC] has shown resilience following a sharp drop related to geopolitical tensions between Israel and Iran. Trading around $62,000 at press time, Bitcoin is showing signs of recovery towards $63,000.
The recent liquidation of long positions may have established a local bottom, suggesting that BTC could be poised for a further upward move with this bottom being the monthly low.
During sharp declines, long-term contracts often fall sharply due to liquidity, reducing selling pressure.
Key liquidity levels remain firm between $68,900 and $69,300 above the price at press time, and between $56,800 and $57,400 below.
A new liquidity cluster is also forming in the $66,500 to $66,800 area, suggesting that the price could target this area soon.
Source: CryptoQuant
Even though BTC price has fluctuated between $55,000 and $75,000 for more than 200 days, Bitcoin has maintained a strong position.
BTC is trading above the 100-week moving average (100MA) on the weekly chart, maintaining strength at the macro level.
Notably, BTC has passed 170 days since the last Bitcoin halving, and historical patterns show that new highs typically form around 1,080 days after the previous cycle peak.
This suggests that, if history repeats itself, Bitcoin is likely to trend higher from current levels.
Source: Sanki/X
Coinbase Premium Indicator
Contributing to this bullish outlook is Coinbase’s Premium tool on CryptoQuant, which highlights BTC’s short-term rise.
When a golden cross pattern forms, as seen in previous price movements, Bitcoin typically experiences a short-term surge. This indicator adds further evidence that BTC could rise from its current local bottom.
Source: CryptoQuant
Demand for Bitcoin ETFs in the US
Demand for Bitcoin from spot ETFs in the US is also increasing. Spot ETFs were net sellers at the beginning of September, but by the end of the month they had bought 7,000 BTC, the highest level since July 2021.
In the first quarter of 2024, spot ETFs bought nearly 9,000 BTC per day, pushing the price to new highs. If this buying trend continues, Bitcoin prices could rise further in the last quarter of 2024.
Source: CryptoQuant
Whales hold steady
Additionally, large Bitcoin Holders, also known as “Whales”, have shown the lowest level of profit-taking in history, showing confidence in the possibility of future price increases.
Whales have been distributing their BTC across different addresses, with only 1,975 addresses now holding between 1,000 and 10,000 BTC.
Despite some recent selling, whales have taken minimal profits compared to previous cycles, further cementing the notion that BTC prices will rise from here as they look to maximize profits.
Source: CryptoQuant
The combination of liquidity, increased demand from ETFs, and strong whale activity suggests Bitcoin is poised for further gains from the current local bottom.
All these factors indicate that the possibility of BTC trending up in the short term is quite high.
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