Bitcoin Maintains Strong Weekly Uptrend with Potential Short Squeeze Above $116,000

Bitcoin (BTC) continues its weekly uptrend, presenting a technical rebound that has sparked discussions among analysts about the potential for a substantial short squeeze if the cryptocurrency surpasses the $116,000 threshold. This scenario could mark a pivotal moment for the market, sustaining Bitcoin’s upward momentum in the near term.

Weekly Uptrend Signals Resilience

Recent data from Brave New Coin reveals Bitcoin’s price movement over the past week. On October 12, BTC briefly dipped to $109,715 before rebounding and closing at $115,170—a level that reflects its ability to maintain strength within the upper boundary of its weekly ascending channel. This channel originates from the cryptocurrency’s 2023 low of $20,000, showcasing a consistent recovery throughout the year and solidifying its upward trajectory.

Short Positions in Focus: Key Levels Could Trigger Liquidation

The $110,000-$117,000 price range has become a focal point for traders, as it is home to a significant concentration of short positions. WhaleInsider, a widely followed analytics account, estimates that this range could prompt liquidations of up to $6 billion in short positions if Bitcoin edges past $116,000. However, other analysts are cautious, suggesting the actual exposure may be closer to $1 billion to $1.5 billion.

The interplay between maintaining Bitcoin’s uptrend and the potential for large-scale short liquidations has heightened market anticipation, contributing to bullish sentiment. As of the latest trading data, Bitcoin is priced at $114,722, reflecting a 24-hour gain of 3.01%. This rally exemplifies the cryptocurrency’s renewed strength amid widespread speculation about its future direction.

On-Chain Metrics Highlight Investor Confidence

On-chain metrics further bolster the argument for Bitcoin’s resilience and bullish outlook. Analysis from Glassnode indicates that long-term holders are reducing their sell-off rate, with a notable 12% decline in liquidation activity. This trend suggests that investors are demonstrating greater confidence in their positions, choosing to hold onto their assets despite ongoing market fluctuations.

Additionally, analysts are observing macroeconomic drivers that could sustain Bitcoin’s upward trajectory, particularly the correlation between global M2 money supply expansion and BTC’s price movement. Crypto analyst CryptoGems has projected that institutional demand, combined with new inflows from exchange-traded fund (ETF) offerings, could propel Bitcoin’s price to $180,000 by the end of the year.

Macro Risks and Geopolitical Uncertainty Persist

Despite a generally positive outlook, macroeconomic risks and geopolitical developments continue to cast uncertainty over Bitcoin’s longer-term performance. Investors should remain vigilant of key factors such as ongoing U.S.-China trade tensions, shifts in global monetary policies, and potential regulatory changes in the cryptocurrency industry. Such challenges could temporarily inhibit Bitcoin’s bullish momentum, creating friction in its climb.

Critical Price Levels to Watch

Market participants are closely watching the $110,000 uptrend line as a foundation of support and the $116,000 short liquidation zone as a critical resistance level. These benchmarks are expected to play a decisive role in determining Bitcoin’s near-term price action. Whether BTC sustains its upward trajectory or encounters resistance, these price levels will serve as essential indicators of the cryptocurrency’s next move.

Bitcoin’s continued recovery highlights its resilience in a volatile market. If the combination of technical strength, favorable on-chain data, and institutional interest persists, the cryptocurrency may unlock its next significant milestone, forging ahead in the face of macroeconomic and geopolitical challenges.