Bitcoin (BTC) just achieved a new weekly closing record as the BTC price dipped slightly before being quickly bought back.
A drop to 95.8K USD for BTC/USD triggered a wave of large liquidations as traders took risks in a weekend environment lacking liquidity.
The 100,000 USD level still seems out of reach, but some question whether this level is truly significant.
Thanksgiving week may be short, but it is not lacking in volatility from US macroeconomic data.
Bitcoin profits are soaring, and long-term holders are exhibiting characteristic behavior of a bull market.
Could Bitcoin ETFs continue to balance selling pressure after a record week of inflows?
Bitcoin market suffers when BTC price is below 96K USD
After a last-minute drop in the weekly closing session, the BTC price ended strong and is now back above 98,000 USD, as confirmed by TinTucBitcoin and TradingView.
BTC/USD 1-hour chart. Source: TradingView
Traders are focused on the battle to surpass the 100,000 USD level for the first time as selling liquidity continues to be replenished.
The risks are very high — investors are increasingly taking risks with trades, evidenced by cross liquidations on crypto reaching 500 million USD in the drop, bringing BTC/USD down to 95,800 USD.
“Passive buyers may have created the low on that Sunday,” popular trader Skew concluded in part of his latest market analysis on X.
“98.5K USD will be an important price level to recover.”
BTC/USDT 15-minute chart with liquidity data. Source: Skew/X
Fellow trader Daan Crypto Trades noted that a “gap” in the CME Group's Bitcoin futures market is currently near the top of its historical range, which could set the stage for the next recovery.
“The gap lies right at the all-time high and price above 99K USD. Seeing that the price has traded close to that level, I assume we will try to completely close it in the near future,” he predicted.
CME Bitcoin futures 15-minute chart. Source: Daan Crypto Trades/X
Zooming out, liquidity, according to data from Hyblock Capital uploaded to X by popular trader CrypNuevo, may still support a trip below 90,000 USD.
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“If we look at the 7-day liquidation heatmap… we can see two regions on the chart: 100.6K USD and 88.5K USD,” he commented.
“It might suggest that the 88.5K USD level is showing more liquidity than the upper level. Therefore, in principle, it should be given a higher opportunity/prioritization for this area.”
BTC liquidation heatmap on Binance. Source: CrypNuevo/X
Previously, TinTucBitcoin reported that markets are predicting an average BTC price at year-end of 127,000 USD.
However, the first hurdle for the bulls is the upcoming end of November.
The importance of the BTC price at 100,000 USD?
With 98,000 USD, Bitcoin easily reached the highest weekly closing level in history on November 24.
November's performance is shaping up to be the best in five years for BTC/USD, while the current Q4 gain stands at 54.5%, according to data from tracking source CoinGlass.
Cryptocurrency liquidation (screenshot). Source: CoinGlass
Nevertheless, the bulls have yet to overcome the key threshold of 100,000 USD, which has led some to prepare for a price adjustment target for BTC.
“Bitcoin with another massive weekly candle. The 100K USD level is a psychological level for many institutions/traders,” popular trader Crypto Fella told followers on X.
“Don't be surprised if we see a correction in the near future. In fact, it will benefit the overall market sentiment.”
However, some others argue that the 100,000 USD level does not hold much significance, a level never reached in Bitcoin's history and thus nothing more than a set of numbers on the screen.
“100,000 is not a technical level. It is also not a psychological level,” fellow trader Aksel Kibar argued over the weekend.
“But for some, it could be a good level to post memes and celebrate.”
BTC/USD 1-month chart. Source: Aksel Kibar/X
Kibar uploaded a chart showing key BTC price peaks, with the next important level near 140,000 USD.
Another article questioned the “obsession” of Bitcoin players with the six-figure price of BTC, which Kibar then contrasted with when gold first broke 1,000 USD.
CoinGlass, meanwhile, indicates that liquidity levels are integrating just below 100,000 USD, with prices digging into the key liquidation level of 98,750 USD.
See also: Texas moves towards Bitcoin reserve fund: Satoshi Action Fund
BTC liquidation heatmap (screenshot). Source: CoinGlass
PCE data headlines the macroeconomic Thanksgiving week
It may be Thanksgiving week, but the US macroeconomic data still holds a lot of volatility for cryptocurrencies and risk assets.
Events begin on November 26 with the minutes from the Federal Reserve's November meeting, where they decided to cut rates by another 0.25%.
A day later, the Fed's “preferred” inflation measure in the form of the Personal Consumption Expenditures (PCE) index will be released, along with unemployment data.
Third-quarter GDP figures were adjusted ahead of two important days for risk asset traders before the Thanksgiving holiday.
As TinTucBitcoin continues to report, all eyes are on the Fed for clues about future policy moves amidst the emerging “inflation stagnation” environment as inflation returns along with rising unemployment rates.
Therefore, markets are uncertain about what the next meeting on December 18 will bring.
“PCE inflation data will have a significant impact as the chances of a rate cut in December have diminished,” trading source Kobeissi summarized on X.
The latest data from CME Group's FedWatch Tool currently puts the chance of an additional 0.25% cut at 56%, down from nearly 75% a month ago.
Probability of the Fed's target interest rate. Source: CME Group
“Most recently, Fed Chairman Powell stated they are not ‘in a hurry’ to cut rates just 2 months after starting reductions with the first 50 basis points cut since 2008. Core CPI inflation is now back on the rise and has been above 3% for 43 consecutive months,” Kobeissi continued in another post on X.
“The Fed is coming back.”
Earnings season lands on Bitcoin
Long-term Bitcoin holders (LTH) are increasingly tempted to take profits at much higher levels than breakeven.
The latest data from on-chain analytics platform CryptoQuant shows that these “diamond hands” are realizing significant profits daily.
On November 22, as reported by TinTucBitcoin, total realized profit reached a new record of 443 million USD.
“The unrealized profit is at a high level, currently at 57%,” contributing analyst Maartunn added, uploading data to X.
See also: The Cardano-Bitcoin Bridge: A Step Towards Bitcoin DeFi?
Daily realized profit ratio of Bitcoin. Source: Maartunn/X
Natural selling is not just related to investors who are used to sitting still. Short-term holders (STHs) — those holding for 155 days or less — are also active.
Analyzing the spend output profit ratio (SOPR) for the STH group, contributing CryptoQuant colleague Avocado_onchain warned that this trend could affect BTC's price momentum.
“Historically, when applying the 30-day moving average to Short-Term SOPR, it has been observed that in uptrends, Short-Term SOPR tends to reach around 1.02 before profit-taking occurs. Each time this level is reached, the price of Bitcoin has experienced a drop or correction,” they noted in a Quicktake blog post.
“Currently, the 30-day moving average of Short-Term SOPR has reached 1.02, indicating that Bitcoin prices, although near 100,000 USD, may face a short-term correction.”
Bitcoin STH-SOPR. Source: CryptoQuant
ETFs face high expectations after a record week
Meanwhile, CryptoQuant along with other parties suggests that large capital inflows could offset any significant selling pressure.
This primarily comes from institutions over the past two months as Bitcoin exchange-traded funds (ETFs) in the United States broke records.
“However, if the capital inflow to the market continues and investors remain eager to buy Bitcoin, this historical pattern may be dismissed, leading to a strong breakout above 100,000 USD,” Avocado_onchain continued.
Source: Ki Young Ju
The latest data from sources, including UK-based investment firm Farside Investors, shows the level of interest in ETFs in the United States. Five trading days through November 22 saw a total net inflow of 3.35 billion USD — more than any other week.
Net inflow of US Bitcoin spot ETFs (screenshot). Source: Farside Investors
“November is shaping up to be a record month for Bitcoin ETFs, with nearly 7 billion USD in net inflows so far and just one week left — likely surpassing the 6 billion USD from February,” noted Rafael Schultze-Kraft, co-founder of on-chain analytics firm Glassnode, over the weekend.
“Notably, we have only seen one negative month since the beginning (April, -1 billion USD).”
Glassnode previously considered that ETFs could continue to outpace selling from LTH as BTC prices continue to rise.
“When Bitcoin surpassed 75.6K USD, 100% of the 14 million BTC held by long-term holders moved into profit territory, driving an increase in spending. This led to a noticeable drop in balances of over 200 thousand BTC since breaking the all-time high,” it revealed in the latest edition of the weekly newsletter “The Week Onchain,” released on November 20.
“This is a classic and repetitive pattern, where long-term holders begin to take profits whenever strong price action occurs and demand is sufficient to absorb it. With a significant amount of Bitcoin still held by LTH, it is likely that many LTH are waiting for higher prices before releasing more coins back into liquidity circulation.”
The LTH supply of Bitcoin is in profit (screenshot). Source: Glassnode
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